U.S. companies are facing growing talent shortages, rising wages, and delays in visa processing. Many are turning to international hiring to fill roles in engineering, data, marketing, and digital specialties that are hard to source domestically. GlobeNewsWire reports that nearly half of companies expect international employees to make up a significant portion of their workforce by 2027.
Hiring internationally expands access to skills and markets, but also brings compliance, payroll, and operational challenges. With this, Nearshore LATAM talent has become a popular option, offering cost-effective, English-fluent professionals who fit well with U.S. workflows and culture.
Let’s explore the main legal pathways, compliance requirements, regional costs, and practical steps to onboard international staff effectively in 2026.
Why U.S. Companies Hire International Employees
To hire international employees means employing full-time professionals outside the U.S. through compliant models such as Employer of Record (EOR), local entities, or visa sponsorship.
In 2026, U.S. companies hire international creative and marketing talent to fill hard-to-find skills like performance marketing, AI talent, and localized campaigns. Nearshore LATAM hires reduce costs by 30%-70%, bring cultural insight for regional markets, and enable distributed teams to work across time zones.
Diversity also enhances creativity and problem-solving across the team.
Access to Global Talent and Hard-to-Fill Roles
Certain roles are simply hard to fill domestically. Senior React developers, experienced paid media managers, and bilingual customer support agents command premium salaries in the U.S. market. Competition for these professionals is intense, and many companies lose candidates to larger firms with deeper pockets.
International hiring expands your candidate pool dramatically. A role that attracts 50 qualified applicants in the U.S. might attract 500 when opened to global candidates. Countries like Mexico, Colombia, Argentina, Poland, and the Philippines produce skilled professionals trained in the same tools and methodologies used by American companies.
Diversity, Innovation and Faster Problem-Solving
Teams with diverse backgrounds handle complex problems more effectively. An NIH report shows that groups with varied perspectives process information more thoroughly, uncover blind spots, and generate more innovative solutions than homogeneous teams.
- Cultural differences reveal gaps in product design and marketing.
- Multilingual members improve global customer communication.
- Varied educational and professional experiences bring fresh technical and creative approaches.
Diversity strengthens problem-solving and drives innovation across international teams.
International Expansion and Market Localization
Hiring locally in target markets accelerates international expansion. A marketing manager based in São Paulo understands Brazilian consumers better than someone researching from New York. Local employees bring language fluency, cultural context, and established professional networks.
Cost Efficiencies Through Nearshore LATAM Talent and Offshore Teams
The cost difference between U.S. and international talent is significant. Depending on role and region, companies can save 40%-70% on labor costs while maintaining quality.
- A mid-level marketing or creative professional, such as a graphic designer, costs $70k-$120k annually in the U.S.
- The same role costs $20k-$55k in Latin America and parts of Asia.
These savings add up quickly across multiple hires, making nearshore and offshore teams a practical option for scaling creative and marketing operations.
What "Hiring International Employees" Really Means
Hiring international employees means employing talent outside the U.S., typically via independent contractors or EOR services. Platforms like Floowi or Deel handle payroll, taxes, and compliance, allowing employees to stay in their home country while joining the American team.
It shifts hiring from a “local-first” model to a borderless strategy focused on skills and cultural expertise.
Full-Time International Employees vs. Contractors
Employees work under your direction and are integrated into your company, while contractors operate independently. Misclassifying can create serious financial and legal risks.
Note: If a contractor works full-time, uses company tools, reports daily, and has no other clients, local law may treat them as an employee. Correct classification protects your company.
Remote Global Staff vs. Local In-Office Talent
Most international hires work remotely. This requires investment in communication tools, project management systems, and security infrastructure. Remote employees need reliable internet, appropriate hardware, and access to company systems.
Some companies hire international employees to work from local offices, either at a company-owned facility abroad or at a coworking space. This approach makes sense for roles requiring physical presence or for building a local team culture.
When Hiring International Employees Is the Right Choice
International hiring fits certain situations better than others.
- You need skills that are scarce or expensive domestically
- You want to reduce labor costs without sacrificing quality
- You're expanding into new geographic markets
- You need 24/7 coverage across time zones
- You require multilingual support for customers
- You want to scale quickly without domestic hiring constraints
Legal Ways for U.S. Companies to Hire International Employees
U.S. companies can hire international talent through three main paths. For remote hires, an EOR like Floowi or Deel handles employment, payroll, and local compliance. Independent contractors are another option, provided IRS Form W‑8BEN is collected. Roles requiring relocation need visas such as H‑1B, L‑1, or O‑1, often with Department of Labor certification.
For most U.S. companies hiring remotely, an EOR is the fastest and lowest-risk way to hire international employees.
1. Use an Employer of Record (EOR)
An Employer of Record becomes the legal employer of your international hire. The EOR handles payroll, taxes, benefits, and compliance with local employment law. You maintain day-to-day control over the work while the EOR manages the employment relationship on paper.
The workflow is simple and clear. You find a candidate, agree on compensation, and the EOR creates a compliant employment contract. The EOR pays the employee, withholds taxes, provides statutory benefits, and ensures compliance. You pay the EOR a monthly fee plus the employee's compensation.
Pros and Cons for Growing U.S. Teams
An EOR lets U.S. companies hire international employees quickly and compliantly without creating a foreign entity. It simplifies scaling but adds some cost and reduces direct control.
2. Hire International Independent Contractors
Using contractors internationally is common but risky if done incorrectly. Each country has its own tests for determining employment status. What qualifies as a legitimate contractor relationship in the U.S. might be considered disguised employment in Brazil or Germany.
Warning signs that trigger reclassification:
- Contractor works exclusively for one company
- Company controls work hours and location
- Company provides all tools and equipment
- Contractor has no opportunity for profit or loss
- Relationship continues indefinitely without project basis
Penalties vary by country but typically include back payment of taxes, social contributions, benefits, and fines. In some jurisdictions, the company may owe severance as if the contractor had been employed for years.
Best Practices for Vetting and Onboarding Contractors
If you legitimately need contractors rather than employees, structure the relationship carefully.
- Use clear contracts specifying deliverables, not hours
- Allow contractors to work for other clients
- Let contractors control how they complete work
- Pay per project or milestone, not monthly salary
- Avoid providing company email addresses or equipment
- Set term limits and renew based on specific projects
3. Sponsor Work Visas for Global Talent
Bringing international employees to the U.S. requires visa sponsorship. Common options include:
- H‑1B: For specialty occupations requiring at least a bachelor’s degree. Valid three years, extendable to six. Recent changes include a $100k fee for new petitions and a move toward wage‑based selection instead of a random lottery.
- L‑1: For intracompany transfers of managers or employees with specialized knowledge. Requires one year with a related foreign entity.
- O‑1: For individuals with extraordinary ability in business, arts, sciences, or athletics. No annual cap.
- TN: For Canadian and Mexican professionals under USMCA. No annual cap; faster processing than H‑1B.
- E‑3: For Australian citizens, similar to H‑1B. Annual cap of 10,500 visas.
Key Point: H‑1B costs and eligibility rules have changed, so employers should plan carefully, factoring in fees, wage-based selection, and processing timelines.
Compliance Requirements and Work Permit Regulations
Sponsoring a visa carries important employer responsibilities:
- File a Labor Condition Application (LCA) with the Department of Labor for H‑1B and similar visas.
- Pay the prevailing wage for the role and location.
- Maintain a public access file with visa-related documentation.
- Report material changes in employment to USCIS.
- Cover reasonable return transportation if employment ends early.
Processing times vary by visa: TN visas may take a few weeks, while H‑1B petitions can exceed a year. Premium processing is available for many visas at an extra cost. Recent H‑1B updates also require employers to account for the $100k fee and new wage‑based selection rules.
4. Set Up a Local Entity Abroad
Establishing a foreign subsidiary gives you direct employment capability in another country. This approach makes sense for companies building substantial teams in a single location.
Typical costs and timelines:
- Incorporation fees: $2,000 to $15,000 depending on country
- Legal and accounting setup: $5,000 to $25,000
- Registered agent and office: $1,000 to $5,000 annually
- Timeline: 2 to 6 months from start to operational
Ongoing requirements include local tax filings, statutory audits in some countries, corporate secretary services, and compliance with local corporate law.
When a Foreign Entity Is the Right Move
A local entity is the right move when:
- You plan to hire 10+ employees in one country.
- You need to sign local contracts or hold local licenses.
- You want full control over employment terms and benefits.
- Your long-term strategy includes physical presence in that market.
For smaller teams or initial testing, an EOR usually makes more sense.
5. Use a Global Payroll Provider
Global payroll providers consolidate payment processing across multiple countries. Instead of managing separate payroll systems in each location, you process everything through one platform.
Benefits include:
- Single dashboard for all international payments
- Consistent reporting across locations
- Automated tax calculations and withholdings
- Currency conversion handled automatically
- Simplified auditing and record-keeping
How to Choose a Payroll Partner
Evaluate global payroll providers on these criteria:
- Country coverage matching your hiring plans
- Integration with your HRIS and accounting systems
- Compliance expertise in your target regions
- Payment methods available to employees
- Currency options and exchange rate transparency
- Customer support quality and availability
Compliance and Risk Management Essentials
Hiring international employees involves legal, tax, and operational risks. Key areas include permanent establishment, employment law variations, and data privacy and IP compliance.
Permanent Establishment Risk for U.S. Companies
Hiring employees in another country can trigger permanent establishment (PE) status, making your company subject to corporate taxes in that country. PE rules vary but generally apply when you have a fixed place of business, employees with authority to conclude contracts, or dependent agents acting on your behalf.
Using an EOR typically avoids PE risk because the employee legally works for the EOR, not your company. Direct employment through a contractor arrangement may not provide the same protection.
Employment and Labor Law Variations by Country
Employment law varies widely across countries. What's standard practice in the U.S. may be illegal elsewhere.
- Termination: Many countries require cause for termination and mandate severance based on tenure. "At-will" employment doesn't exist in most of the world.
- Working hours: Maximum weekly hours, mandatory rest periods, and overtime rules vary widely. Some countries cap workweeks at 40 or 45 hours by law.
- Leave: Statutory vacation, sick leave, parental leave, and public holidays differ by country. Many countries mandate 20 to 30 days of paid vacation annually.
- Benefits: Health insurance, pension contributions, and other benefits may be mandatory depending on location.
Data Privacy, IP Ownership and Global Compliance Requirements
International employment creates data privacy obligations. If you hire in the EU, GDPR applies to employee data. Other regions have their own privacy frameworks with varying requirements.
Intellectual property ownership also requires attention. Employment contracts should include clear IP assignment clauses compliant with local law. Some countries have statutory provisions that override contract terms for employee inventions.
Standard agreements to include:
- Confidentiality and non-disclosure terms
- Invention assignment clauses
- Non-compete provisions (where enforceable)
- Data processing consent
Cost of Hiring International Employees
Hiring internationally involves more than base salary. Employers must account for visa and legal fees, payroll taxes, and mandatory benefits, which vary by country and role. Understanding these costs upfront helps plan budgets and avoid surprises when expanding global teams.
Visa, Legal and Immigration Fees
Hiring international employees under the H-1B program involves several employer-paid fees. Depending on company size and filing choices, government fees typically range from $6k to $10k+ per employee, with higher costs for large employers.
Common costs include registration, filing, training, fraud prevention, and asylum fees, plus optional premium processing (~$2.8k). Legal fees usually add $3k–$8k per petition.
Permanent residency sponsorship, if pursued later, carries separate costs. PERM labor certification alone often requires $10k–$20k in legal fees.
Payroll Taxes, Social Contributions and Benefits
Employer costs beyond salary vary significantly by country. In some regions, mandatory contributions add 20% to 40% to base compensation.
- Social security contributions: 10% to 25% of salary in most countries
- Health insurance: Often mandatory, costs vary
- Pension contributions: Required in many countries
- Unemployment insurance: Employer-funded in some regions
Compensation Differences Across Regions (U.S. vs. LATAM Cost Comparison)
Hiring costs, taxes, and complexity vary widely by region. Latin America provides the most efficient combination of affordability, time zone alignment, and ease for roles like marketing, design, and support. Other regions are generally costlier or more administratively complex.
You can also connect with us for a detailed breakdown of hiring costs in Latin America.
Remote Onboarding and Integration
Effective remote onboarding ensures international employees are productive from day one. It combines pre-hire compliance, proper equipment and access, and structured integration through checklists and clear first-month expectations.
Pre-Hire Compliance and Documentation
Before an international employee starts work, complete these steps:
- Verify right to work in the employee's country
- Execute compliant employment contract
- Collect tax documentation required by local law
- Register for any required social insurance programs
- Set up payroll processing
Providing Tools, Access and IT Infrastructure
Remote employees need proper equipment and system access from day one.
- Laptop or desktop meeting company specifications
- Software licenses for required tools
- VPN access and security credentials
- Communication tools (Slack, Teams, Zoom)
- Project management system access
- Company email and calendar
Decide whether to ship equipment internationally or provide a stipend for local purchase. Stipends are often faster and avoid customs complications.
Global Onboarding Checklists and Day-One Readiness
Before start date:
- Equipment shipped or stipend provided
- All accounts created and tested
- Manager briefed on start date and schedule
- First-week calendar prepared
- Onboarding documents shared
Day one:
- Welcome call with manager
- IT systems walkthrough
- Team introductions
- Company overview and culture
- Initial task assignment
First 30 days:
- Weekly check-ins with manager
- Gradual increase in responsibilities
- Introduction to cross-functional contacts
- Feedback on early work
- Adjustment of processes as needed
Tools and Services That Simplify International Hiring
EOR platforms, global HR software, and international payroll systems make it easier for U.S. companies to hire and manage employees across multiple countries while staying on top of compliance and payments.
Employer of Record Platforms
Major EOR providers include Deel, Remote, Oyster, Papaya Global, and Velocity Global. These platforms legally employ international staff in 100+ countries, managing payroll, taxes, and compliance.
For companies wanting a fully managed hiring experience, Floowi acts as a talent partner that leverages EOR infrastructure to handle payroll, compliance, and contracts for vetted Latin American employees.
When evaluating EORs or partners, consider country coverage, pricing transparency, customer support, and integration with your existing systems.
Compliance Automation and Global HR Software
Tools like Rippling, BambooHR, and Hibob help manage international teams with features for document storage, time tracking, performance management, and compliance monitoring.
You can skip managing compliance yourself - Floowi provides fully vetted LATAM employees ready to start, handling payroll, contracts, and local compliance through its EOR infrastructure.
International Payroll and Payment Systems
Beyond EOR platforms, standalone payroll providers like Papaya Global, CloudPay, and ADP Global serve companies with established entities abroad. Payment platforms like Wise and Payoneer facilitate contractor payments with competitive exchange rates.
Floowi: The Easiest Way for U.S. Companies to Hire International Employees
Floowi streamlines hiring by connecting U.S. companies with vetted Latin American talent, handling payroll, compliance, and contracts so teams can start working quickly without legal or administrative hurdles.
How Floowi Helps You Hire Full-Time Nearshore LATAM Talent Without Entities or Visa Sponsorship
Floowi connects U.S. companies with pre-vetted professionals across Latin America. The model eliminates the need to set up foreign entities, navigate complex employment law, or manage international payroll directly.
Candidates are screened for technical skills, English proficiency, and remote work readiness before being presented to clients.
Fully Managed Payroll, Compliance and Cultural Alignment
Floowi handles the operational complexity of international employment. Payroll processing, tax compliance, and benefits administration are managed so you can focus on the work rather than paperwork.
The emphasis on Latin American talent means time zone alignment with U.S. teams and cultural compatibility that reduces communication friction.
Ideal for U.S. Companies Scaling Marketing, Creative and Tech Teams
The service is particularly suited for roles in marketing, design, development, and customer support. These functions adapt well to remote work, benefit from LATAM cost structures, and require the kind of real-time collaboration that time zone alignment enables.
Your Next Step
If you’re scaling internationally, pick the approach that fits your needs: EORs for full-time hires without entities, contractors for project work, visas for onsite U.S. talent, and local entities only for long-term presence.
Nearshore LATAM talent offers time zone alignment, strong English, and cultural fit - making collaboration smoother and costs lower.
Get compliance right from day one to avoid legal and financial issues later.
Hire international employees with Floowi and build your nearshore team of vetted LATAM talent. Book your free consultation today.
Frequently Asked Questions
Can U.S. Companies Hire International Employees Without Opening a Foreign Entity?
Yes. An Employer of Record (EOR) lets you hire internationally without setting up your own entity abroad. The EOR is the legal employer, while you direct the work.
How Does an Employer of Record (EOR) Simplify Global Hiring and Compliance?
The EOR manages contracts, payroll, taxes, and benefits according to local law. You avoid learning the specifics of each country’s employment rules while still growing your international team.
What's the Difference Between Hiring Full-Time International Employees and Contractors?
Full-time employees work exclusively for you, with set hours and company tools. Contractors handle projects independently, set their own schedule, and usually serve multiple clients. Misclassifying employees as contractors can create serious legal and financial risks.
How Do Payroll, Taxes, and Benefits Work When Employing Nearshore LATAM Talent?
Most companies use an EOR or staffing partner to manage LATAM payroll. They calculate taxes, make required social contributions, and ensure compliance. You simply pay a single invoice covering salary plus fees.
How Much Does It Cost to Hire International Employees Compared to U.S.-Based Talent?
Hiring internationally can save 40% to 70% depending on role and region. For example, a position costing $120k in the U.S. might cost $40k–$60k in Latin America for comparable skills.
What Risks Should U.S. Companies Consider When Working with International Contractors?
The main risk is misclassification. If a contractor arrangement looks like employment under local law, you could owe back taxes, social contributions, benefits, and penalties. Clear project scopes and genuine independence are essential.
Do International Employees Follow U.S. Time Zones, Workflows, and Collaboration Styles?
LATAM employees usually work U.S. hours due to minimal time differences. Employees in Asia or Europe may need adjusted schedules or asynchronous workflows. Professionals experienced with U.S. clients adapt quickly to collaboration styles.
Why Are Companies Increasingly Choosing Nearshore LATAM Talent for Marketing, Creative, and Tech Roles?
LATAM combines cost savings, time zone alignment, English proficiency, and cultural fit. This makes it ideal for roles that require real-time collaboration, like marketing, design, development, and support.
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