Should You Hire an
Employee or a Contractor?
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Building a global team and working with world-class talent is critical for the success of your company. However, correctly classifying employees and independent contractors can be especially tricky in a remote-first world.
If you want to stay on the right side of the law, avoid fines, and maintain compliance on an international scale, it is essential to make sure you are classifying your workers based on the labor laws of the country where they are located.
To start, use this quiz to help you decide whether hiring a contractor or an employee is the right decision for your company.
Is there a clear beginning and end to the work the candidate will complete?
Yes
No
Will you pay the candidate a salary?
Will the candidate be responsible for paying their own employment taxes?
Will the candidate take part in any benefits programs offered by your company?
Will the candidate supply their own resources to complete the assigned work?
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Yes
No
Yes
No
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No
Is the work done by the candidate integral for daily business operations?
Will the candidate be reimbursed for expenses related to their work?
Can they be terminated at any point?
Is the candidate free to work for other companies while they also provide services to yours?
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Will the candidate set their own daily working hours?
Yes
No
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No
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No
Yes
No
It seems like a contractor would be the best fit for your requirements. For your next hire, your company would likely benefit from prioritizing flexibility and the ability to quickly gain the expertise of a highly skilled professional. Maybe you want to hire without establishing your company as a legal employer in a new country — a contractor is the answer. Contractors also operate more independently and could save your company money long term.
Risk Level when hiring a contractor: Low
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It seems you may reduce the risk of compliance issues if you classify your next hire as an employee. We recommend reading our free eBook, "Employee vs. Contractor: The Complete Guide to International Worker Classification" to understand which hiring option is better for the specific role you want to fill.
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Risk Level when hiring a contractor: Medium High
It seems you need a professional who will fully commit to your business long term. Typically, full-time employees will be more invested in the company's success, and they can help build out operations in a new country, hire others, and grow high-performing teams.
A Global employment platform like Globalization Partners helps companies hire talent faster. Your company can bypass entity setup, registration, and payroll tax deductions, plus the time and costs required to execute all of the above – we take care of it all.
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Risk Level when hiring a contractor: Very High
With compliant international entities already in place, a Global employment platform takes care of payroll and meeting mandatory labor requirements. At the same time, your company manages and directs your workers on a day-to-day basis.
Employees receive local statutory benefits, are covered by all mandatory labor laws, and your company reduces its exposure to employment risk. Above all, a Global employment platform reduces the exposure to worker misclassification risk and allows you to make a legal hire quickly.
