To hire in a new country is an exciting step for any growing company. But while global hiring opens the door to new talent and new markets, the process can quickly become overwhelming without the right preparation. Every country has its own employment laws, payroll requirements, taxes, and HR practices and missteps can lead to costly delays or compliance risks.
To help you navigate the process confidently, we have put together a practical guide on how to plan your first hire abroad.
Define the Hiring Strategy
Before initiating the formal hiring process, clarify why you are hiring in the new location and what setup fits your goals.
- Do we need a full-time employee or a contractor?
- Is this role temporary, long-term, or part of a future team expansion?
- Are we hiring in a country where we plan to establish a legal entity?
Your answers will guide the next step: choosing the right employment setup.
Choose the Right Employment Setup
When hiring abroad, businesses typically choose between:
A. Employing Through a Local Entity
If you already have (or plan to establish) a local legal entity, you can employ directly.
Pros: Full flexibility, long-term stability.
Cons: Higher cost, slow setup, ongoing compliance responsibility.
B. Using a Foreign Employer Registration (FER)
Ideal for companies without a local entity but wishing to employ directly.
The employer is registered with local authorities only for employment purposes.
Pros: Ownership of the employment relationship, cost-effective.
Cons: Obligations vary by country and you need local partners
C. Using an Employer of Record (EoR)
The EoR becomes the legal employer on your behalf.
Pros: Fast, easy, and full compliance support.
Cons: Ongoing service cost is generally higher, less flexibility.
Consider your long-term presence, budget, and urgency.
3. Understand Local Labor Laws
Every country has its own rules covering:
- Minimum wage
- Working hours and overtime
- Paid leave (vacation, sick leave, parental leave)
- Public holidays
- Notice periods
- Collective bargaining agreements
- Mandatory insurances and employer obligations
Before you hire, make sure you know the framework you must follow. This ensures that your employment offer is compliant and competitive.
4. Determine Total Employment Cost
Employee cost is more than the base salary. Depending on the country, employers may also owe:
- Social security contributions
- Pension plans
- Health insurance
- Holiday allowances
- 13th or 14th month salary
- Payroll taxes
- Benefits required by law or market practice
This step helps you calculate the true monthly cost of the hire and budget accurately.
5. Set Up Payroll & Mandatory Registrations
To pay an employee compliantly, employers may need to:
- Register with local tax authorities
- Register with social security institutions
- Select pension and insurance providers
- Enroll the employee in statutory schemes
- Implement monthly payroll administration
This is where many companies seek support from payroll experts like Internago to avoid errors and delays.
6. Prepare a Local Employment Agreement
A compliant contract must follow the country’s legal structure and include:
- Job title and description
- Working hours
- Salary and compensation
- Benefits
- Probation period
- Notice period
- Applicable law & collective agreements
- Work location & remote work rules
Using a template from another country can easily lead to non-compliance, always start with a local template.
7. Set Up Onboarding & HR Processes
Once all legal and payroll elements are ready, plan how you will support your new employee:
- Equipment and tools
- Introduction meetings
- First-week agenda
- Performance expectations
- Cultural onboarding
- Team integration
A strong onboarding experience increases retention, especially for remote international hires.
Final Thoughts
Expanding into a new country and hiring your first international employee is often the moment when your global strategy becomes real. With the right preparation, clear processes, and reliable local expertise, you can avoid costly mistakes and build a strong foundation for your global team from day one. By staying proactive about compliance, you will not only simplify your first hire, but you will set your company up for long-term success in your new market.
If you ever feel unsure along the way, partnering with experts who understand local requirements can make the journey smoother, faster, and far more secure.
Interested in simplifying your international expansion? Contact us at info@internago.com or explore our related article: “Smooth onboarding for remote teams”.