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Contractor management software is a digital solution that helps businesses manage the entire lifecycle of hiring, managing, and paying contractors. Some typical features of contractor management systems include automated manual processes such as setting up contractor agreements, making payments and conducting compliance checks.
It’s tempting to manage contractors yourself to save costs as a business. However, going the manual route can quickly get time-consuming, and it’s especially risky if you’re hiring contractors in multiple countries. Contractor management software can offer the following benefits over managing everything yourself:
We admit our bias, but have a proven track record of success behind our name as a standout global employment solution to compliantly hire workers across the globe – which includes our all-in-one platform for contractor management.
With Playroll, we’re not just getting lower costs but a true service-oriented mindset. You don't know what you're missing until you meet Playroll.
Sherene Binni, Senior Office Manager & HR People Partner, Exalate
With Playroll’s contractor management system, you can hire and pay international contractors in 180+ countries. Managing and paying your team is made easy with automated contract creation, global payments in 50+ currencies, and an intuitive platform to manage work for all your contractors in one place.
When setting up your contractor agreements, Playroll does the heavy lifting to ensure compliance with local labor laws. Each client gets their own dedicated Customer Success Manager, at no extra cost, for ongoing support.
Playroll also offers Employer Of Record (EOR) services to hire full-time employees, making it easier to scale your workforce for any type of employment need.
Pricing: $35 p/contractor. Flat fee per month.
Fiverr offers a large marketplace that allows businesses to connect with freelancers worldwide. It’s easy to navigate with advanced filtering options, making it a popular choice for companies that want quick access to talent and browse freelancers by category.
However, managing larger teams of contractors through Fiverr may require additional tools for tracking and contractor management. They also do not offer comprehensive compliance support when hiring international contractors.
Pricing: Base service fees of 5.5% per purchase amount. For purchases under $100, an additional $3.00 is added per purchase.
Upwork provides project management tools and time tracking to help businesses manage contractors. With access to a large talent pool, it’s a great platform for finding specialized skills or purchasing ready-made projects.
On the downside, managing payments across international borders may require third-party tools. They don’t offer compliance support for hiring international contractors. Upwork also charges high fees for its premium features, including dedicated support and customized reporting.
Pricing: Between 5-10% service fees, some plans include contract initiation fees per contract. Custom fees for enterprise customers.
Deel is a well-known platform designed for managing international contractors and employees. It automates multi-currency payments, has comprehensive compliance support, and offers an intuitive dashboard for tracking contractor performance and agreements in one place.
On the downside, they charge high fees for contractor management, starting from $49 per contractor/month, as opposed to the flat fees other providers offer. They’ve also received reviews of high exchange fees and unexpected fees. This can make it hard to properly budget for their services.
Pricing: Starts from $49 per contractor/month.
Rippling is a workforce management system that also offers services to hire, pay and manage international contractors. It offers advanced capabilities to automate payment processing and compliance checks. They offer a wide range of products, including IT and finance management, that can make them a good fit for businesses looking for one platform to handle multiple aspects of their workforce.
On the other hand, Rippling has received public reviews on the steep learning curve of its products, with many products that are difficult to navigate. They do not publicly disclose their pricing, making it hard to make a straightforward assessment of whether their services fit into your budget.
Pricing: Not publicly disclosed.
While there are many strong contractor management solutions on the market, Playroll stands out for its competitive pricing, dedicated support to businesses of all sizes – and built-in compliance to hiring globally.
While hiring independent contractors comes with many perks, government authorities worldwide have started clamping down on the issue of misclassification of employees as contractors, which can open up businesses to hefty penalties.
Playroll does free misclassification assessments to protect clients from these risks, helps set up compliant contractor agreements, and ensures that your IP belongs to you when working with contractors. Dedicated support in these areas comes free of charge, unlike many competitors. When hiring globally, these are essential features to scale your workforce without risk.
In addition, Playroll offers businesses the ability to hire full-time employees compliantly in 180+ countries, and can help convert your independent contractors to employees if needed. This helps your business remain flexible to any future workforce needs, without bringing any additional third-party services on board.
Book a chat with our team to find out how we can help you scale your global team, without the red tape.
Our comprehensive guide to employee misclassification include a checklist to distinguish correctly between employers and contractors, and top tips to avoid misclassification risks.
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In our first year, Playroll hit the ground running, quickly becoming a trusted leader in global compliance. With the VAT IT Group's 25 years of experience backing us, we entered the market as seasoned experts who understood the challenges businesses face when hiring internationally.
We’re competitively priced and built on VAT IT’s two decades of global hiring expertise. We weren’t starting from scratch—we knew the issues and used our wealth of knowledge to address them head-on. The question was: If not now, when? With the infrastructure, expertise, and passion in place, it was time to power global compliance with Playroll."
Brendon Silver, Co-Founder, Playroll
By launching our Employer of Record (EOR) and Contractor Management services, we aimed to disrupt the market with a seamless blend of technology and service. Our user-friendly platform and customer-first approach positioned Playroll as a human-centered solution designed to enhance the global employment experience from day one.
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In our second year, Playroll truly hit its stride, deepening partnerships with businesses of all sizes worldwide. We became a trusted ally, helping companies manage international teams while navigating the complexities of ever-changing local regulations.
Reflecting on this milestone, Brendon Silver, Co-Founder of Playroll, shared, “One of our proudest moments was successfully migrating a client from a competitor and securing our first customer with over 50 employees. Today, we're thriving across multiple regions and doing it with excellence.”
Year two was marked by significant growth. We introduced integrations with top HRIS platforms like BambooHR and HiBob, launched our Open API, and expanded our reach to over 110 countries. With thousands of employees and contractors now relying on our platform, we enhanced our services by rolling out localized benefits tailored to meet the growing demand. This year was all about scaling our vision and increasing our impact on the global employment landscape.
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At three years strong, Playroll is redefining the global employment landscape with a perfect balance of product innovation and human-centered excellence. We've truly come into our own, supporting businesses in over 180 countries and seamlessly onboarding thousands of employees and contractors.
We're showing our customers that you can trust your external HR provider completely. We care deeply about their success, respond quickly, and stay dedicated to their needs. EOR was just the beginning—global payroll is next!
Erez Golan, Co-Founder, Playroll
As we continue to grow, we're pushing the limits of what’s possible, creating advanced solutions that streamline payroll, compliance, and payments across borders. Playroll isn’t just keeping up with the industry—we're leading it, driving the future of global employment through innovation, care, and unwavering commitment. The journey has just begun!
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As we celebrate three years of Playroll, we’re not just reflecting on our successes—we’re charging full speed ahead into the future. With the confidence gained from our past milestones and the lessons we’ve learned along the way, Playroll is poised to continue reshaping the global employment space, pushing boundaries, and innovating like never before.
Reflecting on the company’s growth, Erez shared: 'Our journey has been like building a championship team, with everyone playing their part and putting in the work. While it's rewarding to see how far we’ve come, what excites us most is the potential that lies ahead.'
Success in business comes down to one simple formula: find the best talent, share a clear and inspiring vision, and then empower them to achieve it in their own unique way. When you give great people the freedom to use their skills, the possibilities are endless.
Brendon Silver, Co-Founder, Playroll
Here’s to the next chapter of bold growth, innovation, and reimagining what’s possible. The future is brighter than ever, and at Playroll, we’re just getting started! 🌍🚀
Employee misclassification is the incorrect categorization of a worker as an independent contractor when they should be classified as an employee due to the true nature of the relationship, regardless of the type of contract they had entered into. This misclassification occurs when companies fail to meet legal criteria that distinguish employees from contractors.
Why is this problematic?
Employee misclassification is particularly challenging because the criteria for determining employment status vary between countries and states.
For example, a worker classified as a contractor in the US may be seen as an employee in the UK based on local labor standards. Because these rules can be complex, many businesses rely on expert assistance to ensure compliance across different jurisdictions.
To avoid misclassifying employees as independent contractors, you first need to know how to distinguish between them. Here are the key differences:
Employees have income tax automatically deducted from their wages, while contractors are responsible for their own tax filings.
Employees follow strict guidelines from their employer on how and when to perform their tasks, while contractors have more flexibility and autonomy.
IP created by employees typically belongs to the employer, while IP created by contractors remains their own unless specified in contracts.
Employees are entitled to mandatory benefits such as health insurance, unemployment insurance, and workers' compensation, while contractors usually do not receive these same benefits.
Employees are also generally entitled to protection from discrimination and harassment, whilst contractors may not be afforded the same level of protection.
Correctly distinguishing between employees and contractors can get surprisingly complex: several tests exist for this reason, for example the Economic Reality Test test in the U.S.
There are, however, some common hallmarks of misclassification. Here’s your checklist of the most common questions that government authorities use to determine misclassification. If you’ve hired a contractor and find your answers aligning with the characteristics of an employee, it’s a red flag that they may be misclassified:
There are several risks to employee misclassification, whether unintentional or not – though the repercussions tend to be most severe if government authorities find that a business has intentionally misclassified workers or committed fraud.
Some of the repercussions can include:
Whilst any industry is susceptible to employee misclassification, in our experience, some industries have longer standing practices of misclassification than others or it’s generally more common.
For example, businesses in sales, IT, high-tech, hospitality, entertainment, logistics and construction industries should be especially aware of misclassification risks.
Penalties for employee misclassification differ between countries but can include financial fines, tax penalties, and reputational damage. For example:
The IRS imposes heavy fines for unpaid payroll taxes, along with penalties for failure to provide benefits like health insurance or workers' compensation. The Wage and Hour Division of the U.S. The Department of Labor also actively pursues claims. For example, you can be subject to a $50 fine for each unfiled Form W-2, or charged a percentage of wages.
Companies may face penalties under the UK’s Employment Rights Act, including paying back-pay for lost wages, holiday pay, and missed pension contributions.
Penalties vary but may include large fines, repayment of lost unemployment insurance benefits, and damage to the company’s standing with labor unions.
Several notable legal cases highlight the consequences of misclassifying employees:
There are several measures you can take as a business to avoid the pitfalls of misclassification. These include:
Ensuring compliance and the correct classification starts at the recruitment and onboarding stages. When hiring contractors, make sure your contractor agreement is set up correctly in line with local labor laws. It should cover, amongst others (see checklist above):
In a worst-case scenario, a robust contractor agreement can be used in your defense in legal cases – assuming you truly haven’t misclassified the worker.
Whilst the content of the contractor agreement is important, employers should still be aware of the “substance over form” principle, discussed above, and determine if it is applicable in the countries in which they hire individuals.
Employment laws are constantly evolving, especially in the context of remote work.
Spend time researching local regulations for the regions you’re interested in, before taking the next step and hiring an independent contractor or employee.
Regularly review the status of all your workers to ensure they are correctly classified. Make sure this forms part of your standard policies or procedures, and assign ownership of the audit to a specific person or department so these checks don’t fall through the cracks of your business.
If a contractor's role has evolved to more closely resemble that of an employee, consider offering them a formal employment contract. This can also hold the following benefits:
It can take significant time and resources to stay compliant as a global business when hiring remote workers. That’s why many businesses choose to use global employment services like Playroll, that have experts on-hand to help you make sense of local labor laws and stay fully compliant when hiring across borders.
I always feel completely calm and safe with Playroll, which is very important to me and the people we employ. I have complete trust that everything is done by the law.
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Violeta Cirkovic, HR Generalist, Two Desperados
Employee misclassification can get complicated, but it doesn’t have to be a bottleneck to scale your global team.
Playroll can help businesses sidestep employee misclassification risk by ensuring compliance with employment laws in over 180 countries. No matter what type of worker you want to hire, Playroll’s team of experts will do the heavy-lifting to ensure your workforce is correctly classified and compliant – freeing you up to focus on your business growth.
Book a free chat with our team and get a compliance consultation, to ensure your business is not at risk of misclassification.
In Spain, employee benefits are divided into mandatory and supplemental categories. Mandatory benefits are stipulated by the Spanish Workers’ Statute (Estatuto de los Trabajadores). In contrast, supplemental benefits are often offered to enhance compensation packages and remain competitive in the job market.
Not all Spanish employees are entitled to the same benefits. For example, Spanish full-time employees work an average of 40 hours per week. These types of Spanish employees are entitled to all statutory benefits including maternity/paternity leave, annual leave, and paid sick leave under Spanish law.
On the other hand, part-time employees are defined as Spanish employees who work up to 20 hours per week. These employees receive proportional benefits, based on the hours worked, in line with Spanish law.
Contractors and freelancers (autónomo) in Spain work independently of any employing entity. In Spain, these workers can sign up to a special scheme for freelancers called RETA. This regime requires that freelancers contribute a specified amount to the social security system (Tesorería General de la Seguridad Social – TGSS). In exchange, they can enjoy benefits provided by the system such as medical treatment, sick pay, and retirement.
Mandatory employee benefits in Spain are statutory requirements outlined by labor laws, ensuring employees receive basic rights such as paid time off, leave for family-related events, and social security.
Spanish labor law ensures that new mothers receive 16 weeks of paid maternity leave after the birth or adoption of their child. There is an additional guarantee of two extra weeks of paid leave per child in cases where the mother gives birth to multiple babies or babies born with disabilities.
Paternity leave (or “partner leave” as it is officially called by the Spanish government) has recently also been extended to 16 weeks of paid leave, to accommodate fathers of newborn or adopted children. Both types of leave are funded by the country’s Social Security.
Employees in Spain are entitled to 30 calendar days or 22 working days of paid annual leave each year, as outlined in the Workers’ Statute (Estatuto de los Trabajadores). However, the Collective Bargaining Agreements (CBAs) may secure additional days for workers in certain industries.
Employees unable to work due to illness are eligible for paid sick leave. This is typically covered by the Social Security system, with up to 18 months of paid sick leave depending on the severity of the illness. The first three days of sick leave are unpaid. The employee can receive 60% of pay between the fourth and 20th day and is eligible to receive 75% of pay from the 20th day onward.
In addition to paid annual leave, Spanish employees are entitled to up to 14 paid days off in observance of national holidays (that are region-specific). All Spanish employees must be allowed to celebrate the nine nationwide holidays such as New Year’s Day (Año Nuevo), Good Friday (Viernes Santo), and Labor Day (Día del Trabajo). Other holidays granted to employees are dependent on provincial and regional customs.
In Spain, the social security fund is made up of several funds that address various aspects of employees’ lives such as illness, unemployment, disability, and retirement.
Employers contribute 30.48% and employees contribute 6.47% (a total of 36.95%) towards INSS contributions.
Workers’ compensation is also referred to as Collective Agreement Accident Insurance (Seguro de Accidentes de Convenios Colectivos) because the provisions are usually dependent on the outcome of CBA negotiations for specific industries.
This insurance provides healthcare and financial support to individuals who have suffered from job-related accidents and illnesses that prevent them from working.
While this pay is usually an additional perk in other countries, employers are required to provide their workers with two annual bonuses (13th and 14-month pay). Each bonus is equal to one month of an employee’s salary and is also subject to income tax.
While mandatory benefits ensure basic rights, supplemental employee benefits can significantly enhance a compensation package and help attract top talent. Common non-mandatory benefits in Spain include:
Employers often provide additional health benefits, such as private medical insurance, to cover employees and their families, complementing the public healthcare system. Health insurance can cost Spanish employees an additional 100 to 200 euros per month so offering private health insurance will be greatly valued by employees. Private healthcare gives employees access to better quality healthcare (when compared to Spain’s public healthcare system).
An additional benefit that addresses employees’ physical health can make your compensation package more competitive. This can involve offering your employees additional medical coverage that includes expenses such as dental, vision, and disability that are not covered by mandatory health insurance.
Spanish federal labor law ensures paid leave in certain circumstances such as maternity and paternity leave. However, additional paid time off is a powerful benefit to add to your benefits package as additional days off help employees manage unforeseen circumstances or celebrations in their personal lives. This is sure to boost company morale and improve employee work-life balance.
Many employers in Spain offer private pension plans to supplement the mandatory public pension system.
Certain employee benefits, such as pagas extraordinarias (extra pay), and meal vouchers, can have tax advantages for both employers and employees in Spain. Employers may receive tax deductions for offering specific benefits like private health insurance or childcare and meal vouchers, reducing the overall cost of providing supplemental benefits.
Compliance with Spanish labor laws is crucial when offering employee benefits. Employers must adhere to regulations outlined in the Estatuto de los Trabajadores (The Worker’s Statutes) and ensure they meet legal obligations. Spanish labor law requires that employers provide base-level benefits to their employees. If employers fail to do so, this can lead to penalties, including fines and legal disputes.
Mandatory benefits are merely the bare minimum as outlined by Spanish Federal law. Employers can and should consider offering additional perks to their employees.
Daunted by the complexity and red tape of complying with local labor laws? Playroll does the heavy lifting to ensure you always tick the box on compliance, so you can focus on building your business.
To remain competitive in the Spanish market, companies often provide additional perks, including:
Employee benefits significantly contribute to the total cost of hiring in Spain. On average, statutory and supplemental benefits can account for around 30-40% of an employee's total compensation.
For a detailed breakdown of how benefits affect your employer costs, use Playroll’s Free Global Employee Cost Calculator for country comparisons.
Get a detailed breakdown of what your new employee will cost and compare different markets with Playroll’s free employee cost calculator.
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Managing employee benefits can be overwhelming, but Playroll simplifies the process. With a presence in over 180 countries, our platform ensures seamless onboarding, payroll, and benefits administration. Playroll ensures compliance with local labor laws while providing a competitive edge through attractive, localized benefits.
Book a chat with our team to learn how we can scale your global team with ease.
An Employer Of Record (EOR) is a third-party service that assumes all employer responsibilities on behalf of another business, including payroll and benefits management for employees. EOR services are widely used by companies that are hiring employees internationally, without the hassle, time and cost of establishing a legal entity first.
The EOR acts as the legal employer paper, while you manage the employee's daily activities.
Yes, we admit our bias, but can point to a proven track record of success when it comes to compliantly employing, managing and paying remote teams for businesses of any shape and size.
Playroll simplified our expansion into new markets by providing a comprehensive understanding of local regulations. Through this partnership, we could immediately tick the box on compliance, at no risk to BET Software.
Gizelle Govender, Senior People Partner, BET Software
As a global Employer Of Record, Playroll stands out for its cost effective pricing, without compromising on the quality of its EOR services or support. It offers truly human customer support for both employers and employees to simplify international employment. This is in contrast to many competitors that rely on ticketing systems, do not offer dedicated support, or upcharge for support. We are uncommonly flexible when it comes to the needs of our customers, going the extra mile to customize contracts and facilitating transfers between EOR and client entities as needed.
Playroll’s user-friendly platform allows you to employ, pay and manage employees and contractors alike in 180+ countries, and provides a team of experts that ensures compliance with shifting employment regulations. Other services include comprehensive localized benefits packages, immigration support, and streamlining global payroll operations.
Pricing: From $399 per month, per employee. No annual commitment required for affordable prices.
Papaya Global is especially known for its comprehensive support in payroll processing, and is innovative when it comes to integrating AI within HR tech. They have a broad range of customization options available to customers.
On the downside, Papaya Global relies fully on third party partners to provide their services, instead of having its own infrastructure of owned entities. This can mean extra fees being passed on to customers, on top of already hefty monthly EOR fees. It also means the EOR provider always has to liaise with third-party partners when providing customer support, which can significantly delay their response times.
Pricing: From $599/month, per employee.
G-P is a popular EOR choice that offers a broad range of products. They split their EOR services between a core and premium offering. This can be useful for businesses that are looking for a broad range of options to pick and choose from. They also have many options to tweak and customize services, and advanced data analytics.
Globalization Partners does have its cons. Their pricing is complex and obscure, with reports of high monthly fees. Many of their EOR features are only available with their premium product, and they’ve received some negative feedback for slow customer service. Overall, this could make them a poor fit for smaller companies that have more limited resources and require more hands-on support to make their first international hires.
Pricing: Not publicly disclosed.
OysterHR is known for their fun branding and user-friendly platform, with quick onboarding times reported. They have a wide country coverage, and solid compliance credentials behind their name.
On the other hand, they are priced at the upper end of the market for their EOR services, which can quickly prove to be a financial bottleneck for companies hoping to hire more than just a handful of international employees. In addition, there have been some reports of payroll mistakes and delays on public review sites.
Pricing: From $599/month, per employee if paying annually. Monthly plans are priced from $699 p/month.
Remote is a well-known EOR provider, with a focus on providing services through their own network of owned entities, which can be useful for businesses that want to avoid dealing with any additional third parties in the equation.
On the downside, their EOR fees are very high compared to some other names in the business, and they have received some negative reviews on slow customer service and multiple points of contact. They also don’t offer a very wide network of country coverage for EOR services, with less than 100 countries covered, which can limit your ability to scale as a business.
Pricing: From $599/month, per employee.
Deel is another well-established player in the EOR space, offering options to manage full-time employees and contractors in 150+ regions. They can be a good fit for businesses looking for an EOR partner with many owned entities, and a comprehensive range of integrations.
That said, Deel’s fees are expensive and require annual commitments for cheaper pricing, and they’ve received many negative reviews of hidden fees and unexpected costs. This can make it hard to properly budget for their services, and can prove too expensive for smaller businesses looking to scale globally.
Pricing: From $499/month, per employee if paying annually. Monthly plans are pricier, at $599 p/month.
Rippling is a popular workforce management solution, and is especially known for their broad range of products that include payroll, finance and IT management. This can make them a good choice for companies looking for a single solution to workforce management.
If you’re looking for a specialist in global employment and EOR services though, there are some cons to consider. Their pricing is not publicly disclosed, though high fees are reported – and they’ve received negative reviews of a bloated product with a steep learning curve, as well as payroll errors.
Pricing: Not publicly disclosed.
Velocity Global stands out for its wide country coverage as an EOR provider, at 185+ regions, which can make them a good choice for employers interested in stable support for any future growth plans.
They are another example of an EOR provider that doesn’t disclose their pricing publicly, with reports of steep monthly fees. Another downside is the many negative reviews they’ve received for slow customer service and multiple points of contact, which can make them a frustrating provider to deal with if you value quick response times to enquiries.
Pricing: Not publicly disclosed.
Multiplier offers good pricing for the EOR services, and has a solid library of extra global hiring resources available for employers. They also have all compliance credentials needed to mitigate risk for employers looking to hire internationally.
On the other hand, they take a complex approach to invoicing, and have received some reviews of slow and faulty payroll services. They’ve also received negative feedback on slow customer service. Overall, this can mean risk to your business if you value simple, timely payroll for employees.
Pricing: From $400/month, per employee.
WorkMotion is an EOR service that specializes in supporting European companies, and can also assist with in-country registrations – which can make them a good choice for EU companies looking to expand their business.
As for its cons, WorkMotion charges very high EOR fees that only become more affordable when hiring many employees. They also don’t offer any support in hiring independent contractors, which can be detrimental to businesses that are looking for a single service to hire any type of worker across the globe. Lastly, they don’t have SOC2 certification, which many businesses require to safeguard their data when working with EOR providers.
Pricing: €649 p/month ($724) per employee for up to 4 employees. Price decreases if onboarding more people.
Playroll ticks the boxes on robust compliance, broad country coverage and many owned entities. This is similar to many of the competitors mentioned on this list, and are some of the standard offerings you should look out for when choosing an EOR provider that offers comprehensive services.
Overall, though there are many strong EOR contenders on the market, Playroll stands out for its competitive pricing, as well as its on-the-ground support for businesses of all sizes – with dedicated support and flexibility for both employers and employees.
We believe quality support is the single most important trait for an EOR provider, since EORs support businesses that are expanding into jurisdictions they’re often unfamiliar with. This means quick responses to tricky compliance questions, flexibility to customer needs and a truly human touch is invaluable.
Book a chat with our team to find out how we can help you scale your global team.
Compare the top EOR providers side-by-side, with a full breakdown on cost, support, coverage and more.
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Remote working is increasingly becoming ingrained in the UK corporate culture. According to StandOutCV, 58% of UK employers offer remote work, with 16% of the UK workforce working full-time from home in 2023.
Cutting-edge business technology, robust internet connection, and the peak of the COVID-19 restriction in 2020 are the top reasons for the increasing shift to this new work culture.
That creates the need for remote management tools to help businesses streamline workflows, manage and monitor remote teams, and ensure secure access to company systems and networks.
Playroll is an all-in-one payroll and HR management platform that offers employment and payroll solutions to help businesses build and manage remote teams efficiently.
This article covers the seven types of remote administration tools for businesses in 2024 and beyond.
Effective communication and collaboration are essential when employees work remotely from different locations. Video conferencing tools and instant messaging apps are the top remote management tools in this category that help bridge the gap and create a seamless work environment.
For instance, video conferencing tools facilitate face-to-face meetings and remote presentations. With messaging apps, remote teams can create groups or channels to organize conversations by topic or project and communicate in real-time.
Reliable communication and collaboration tools to check include:
With about 12.7% of employees working full-time from home, project management and task-tracking tools are absolutely essential for businesses. They enable managers and supervisors to plan projects, schedule tasks, and allocate resources.
From behind a computer screen, managers can set deadlines, assign tasks, and set clear responsibilities to enable remote teams to collaborate on projects. Again, these tools provide important reports and insights to help managers track overall project progress, identify issues, and make adjustments accordingly.
The best remote management tools in this category include:
The 9-to-5 working schedule is lost when employees work from home. That makes it difficult to monitor their home office activities because supervisors don’t have physical access to their remote computers and mobile devices.
Time tracking and productivity software help solve this problem. They work in the background to track down employees' activity and non-activity time. That enables companies to determine time spent on assigned projects or tasks to evaluate performance and productivity.
Time tracking tools also ensure that working hours are fully recorded to enable HR managers to generate payroll easily and quickly. Top remote management tools in this category include:
Playroll's HR and payroll management software integrates with time tracking and productivity tools to automatically log working hours and generate accurate payroll.
Cloud-based storage systems are great remote management tools for file sharing. Unlike in-house file storage systems that are only accessible locally, files on the cloud are accessible to team members at any time regardless of their geographical location.
That enables team members to create, store, edit, share, and access content from any device. Teams can easily collaborate and work on projects or tasks on shared files where everyone can see updates and track file versions. That helps eliminate slowdowns and ensure faster completion of workloads.
The best remote management tools in this category include:
Remote desktop and access tools help technical support teams and managed service providers (MSPs) offer remote support without needing physical access. These tools are embedded in operating systems on company devices, including laptops, computers, tablets, or even mobile devices.
That enables technical support teams to respond to issues quickly without the need to travel on-site. They can remotely manage operating systems' updates, troubleshoot networks, and transfer files. They can also send a command line of tasks to multiple PCs, configure devices, and if necessary, shut down remote computers.
Top remote desktop and access tools include:
If implemented well, employee monitoring has been found to increase employee productivity by 7%. Remote monitoring and management tools help businesses track and analyze how employees utilize working time and company resources.
They track and monitor employees' activities like internet use & browsing, emails, phone calls, or even video surveillance. Such data is then analyzed to draw important insights and identify areas of improvement.
That helps companies ensure remote workers perform their duties efficiently, adhering to company policies and ethical standards. It also helps protect and identify insider threats that can result in damaging data breaches.
Best remote management tools for employee monitoring include:
With companies spending an average of $4.37 million to recover from damaging data breaches, the need for robust data security tools cannot be overlooked.
These tools ensure real-time monitoring of computer networks to identify and report threats. They also scan and remove viruses and malware apps to improve the security of remote and hybrid work environments. Top remote management tools for data security include:
As remote working continues to take root, remote administration tools are becoming an indispensable part of modern business operations. Therefore, business owners should consider using the above tools to ensure hassle-free remote monitoring and management of their workforce.
Playrooll's HR and payroll management system integrates with your remote management tools to ensure streamlined HR and payroll processing for remote teams. Request a demo to see how you can optimize your remote management with Playroll.
In the U.S., employee benefits are divided between legally required employee benefits and supplemental benefits that vary depending on the state or the employer's discretion. Federally mandated benefits apply to all 50 states across the United States under federal law whereas benefits at a state level are dependent on the respective laws of the 50 states.
Federally mandated benefits are benefits that companies with full-time employees are legally required to provide to their workers. State-level requirements refer to benefits that may differ from one state to another. For example, employers in certain states (such as Colorado and New York) must provide paid leave to their employees due to state law.
Federal law and state law mandate certain benefits for full-time employees, while others, like voluntary benefits, are commonly offered to attract and retain talent.
Full-time employees are entitled to all statutory benefits, while part-time employees may qualify for limited benefits, such as workers' compensation or unemployment insurance. Benefit entitlements can also vary based on employer size and location.
As an employer, it is important to be able to distinguish the types of employees in your workforce. Full-time employees are =employees who work more than 35 hours a week whereas anyone who works less than 35 hours per week is considered a part-time employee.
These characteristics may differ from one business to another. In some cases, the law outlines the maximum number of hours an employee can work to be considered part-time. Once exceeded, they will be afforded the same benefits as full-time workers For example, the Fair Labor Standards Act (FLSA) states that non-exempt employees are entitled to overtime pay any time they work more than 40 hours per week.
Employers should take the time to understand what each mandatory benefit means to remain compliant with the law and provide the legally required employee benefits to their workers. These benefits were put in place to protect workers’ rights. Statutory employee benefits can be broken down into four subgroups namely:
Social Security is a federally mandated benefits program that provides income support for retired workers (and their dependents) as well as for workers with disabilities and survivor benefits. Both employers and employees contribute 6.2 percent of the employee's wages and self-employed individuals pay 12.4% of their earnings.
Medicare is a public health insurance program primarily for individuals aged 65 and older. Social Security taxes and contributions made by employers and employees fund this program.
This is a nationally mandated benefit that covers medical care for retired individuals and provides financial support to individuals affected by loss of work and disability. It also covers liabilities resulting from workplace injuries and illnesses. This disability insurance is mandatory in nearly all 50 states in the U.S. and protects employers from lawsuits related to workplace injuries.
The Family and Medical Leave Act (FMLA) states that eligible employees are entitled to 12 weeks of unpaid annual leave for specific family and medical reasons. These reasons include the birth of a child or caring for a family member with a serious illness.
To qualify for family and medical leave, an employee must have worked for their employer for at least 1,250 hours in the past 12 months and their employer must have 50 or more employees.
Unemployment insurance provides temporary financial assistance to workers who lose their jobs but are willing and able to work. It is funded through employer taxes of 6% on the initial $7,000 of an employee’s annual salary.
The 6% employer-only contribution exists at a federal government level, but the taxes paid towards the State Unemployment Tax Act (SUTA) differ between states.
It’s often not enough for an employer to only offer their workers statutory benefits. In order to attract the best talent in the U.S. and beyond the country’s borders, employers should think about which supplemental benefits are best suited to their workforce’s needs.
While employees in the U.S. are ensured social security benefits, most employees appreciate increased coverage from popular retirement plans such as 401(k)s. These retirement savings plans allow employees to save comprehensively for their futures, often through contribution-matching policies with their employers.
Certain businesses are required to provide health insurance coverage to their employees under the Affordable Care Act (ACA). Employers may go beyond this statutory requirement by providing broader coverage such as private health insurance to their employees. Offering private healthcare is highly valuable to employees given the high cost of healthcare in the States. According to the Centers for Disease Control and Prevention (CDC), 12.2 % of Americans in the workforce did not have health insurance in 2022.
This highly desirable benefit typically includes paid vacation days, sick leave, and personal days for employees. While this benefit is not legally required, it certainly helps improve employees’ work-life balance and general well-being.
A basic employee healthcare plan may not include vision and dental coverage. If this is the case in your business, consider offering your employees this additional coverage that will give them access to optometric and dental care.
Equity benefits are an investment opportunity that employers can present to their employees in the form of non-cash payments. When implemented, this benefit makes employees partial owners of the company they work for. As an added bonus, employees tend to be more motivated to ensure the company’s growth if they have a personal stake in it.
Employee benefits in the U.S. can have tax implications. For instance, fringe benefits like health insurance and retirement contributions are often tax-deductible for employers. Additionally, some benefits may qualify for tax breaks or incentives, helping companies, like small businesses, manage the cost of offering comprehensive benefits packages.
The Internal Revenue Service (IRS) clearly outlines that any benefit provided by an employer is subject to employment taxes and must be included in the employee’s pay unless it is categorized as an excluded benefit by the IRS.
Failure to provide required benefits can result in severe penalties for employers. The consequences for neglecting to provide employees with benefits vary by state and type of benefit.
For example, failing to provide adequate Workers’ Compensation Insurance is considered a criminal offense in California, New Jersey, and Pennsylvania. Offenders can be subject to fines of $10,000 and prison time in some cases.
Some employers intentionally misclassify their workers to avoid providing them with mandated employee benefits. In such cases, employers will be subject to steep fines, lawsuits, and reputational damage.
There are other perks you could add to your benefits package to make it more attractive to top talent such as:
These perks go beyond basic benefits and contribute to a positive work environment that can set your company apart in a competitive talent market.
Offering statutory benefits can significantly increase the cost of hiring employees. On average, legally required benefits like Social Security, Medicare, and workers' compensation account for around 10-15% of total employee costs. According to the Bureau of Labor Statistics (BLS), employee’s benefits cost between 20-40% of their salary.
Having a clear grasp on the costs associated with employee benefits is essential for accurate budgeting as an employer. For a detailed comparison of employee costs across different countries and U.S. states, check out Playroll’s free employee cost calculator.
A work visa in South Africa is a government-issued document that allows foreign nationals to legally live and work in South Africa for a specified period. This document is a tool that governments leverage to ensure that non-citizens are employed per immigration and labor protection laws.
A work visa is a type of nonimmigrant visa. This visa category stipulates that foreign individuals must return to their home country upon the expiration of their visa. Visa holders may apply for extensions or renewals to remain in the country.
Work permits and visas are often used interchangeably but are not synonymous and serve different purposes. Work permits are typically long-term and linked to a specific employer, whereas work visas may be short-term or tied to specific projects. Understanding these distinctions is crucial for employers to ensure compliance and avoid legal pitfalls.
If you’re sponsoring an employee to enter the country and work for you in South Africa, you will mainly be dealing with work visas. We will primarily be discussing work visas for the purposes of this article.
Any non-citizen intending to work in South Africa must obtain the appropriate work visa or permit. Employers should have thorough verification processes to ensure that any foreign national they hire has authorization to work in the country. Failure to do so will be considered non-compliance with immigration laws and can have severe ramifications, including fines and potential legal damage.
Playroll offers visa support services in South Africa. Our experts help simplify the process of building a global workforce, and ensure you stay compliant every step of the way in the process.
South Africa’s robust economy, manufacturing sector, and technological advancements have made the country a hub of employment opportunities. As a result, South African work visas and permits are in high demand.
South Africa offers several types of work visas and permits, each catering to different employment needs. Employers should be familiar with these options to effectively aid their employees’ application processes:
Employers should have an in-depth understanding of the eligibility criteria, duration, and specific conditions for each visa type to make optimal decisions for their workers and businesses.
Employees applying for a work permit or visa in South Africa must provide a range of documents that are outlined by the Department of Home Affairs on its visa webpage. This includes documentation the employer should supply. Here’s a summary of the key documentation required:
The general requirements for a General Work Visa include:
An application for a General Work Visa should be accompanied by:
Relevant requirements for employers include:
The general requirements for a Critical Skills Work Visa include:
Requirements for employers include:
The general requirements for a Intra-Company Transfer Work Visa include:
Noteworthy requirements for employers include:
Employers must support their employees throughout the visa application process to ensure the smooth and legal onboarding of foreign workers. This support includes providing the employee with detailed job descriptions, employment contracts, and letters of confirmation.
The employer also has certain responsibilities throughout the application process. These responsibilities include confirming the validity of the applicant’s documents, ensuring that the employee leaves the country on the expiration of their visa, providing proof of efforts to hire locally, and paying a cash deposit or guarantee for the foreign workers in the case of a corporate visa.
Check out our table above for the exact details on what would be required of you as an employer during the visa sponsorship process, depending on the specific work visa at stake.
The fees for obtaining a South African work permit or visa vary depending on the type of visa and the applicant's nationality. Employers should be aware of these costs and factor them into their budgeting for international hires. Additional fees may be associated with mailing and visa renewals, or extensions.
The schedule of fees below was taken from VFS Global, the official partner of the Department of Home Affairs (DHA) in South Africa in visa facilitation services. It should be treated as an estimate of application fees for 2024.
South African visa applications take different times to process depending on the country of the application and the embassy or commission where it is lodged. We have compiled a list of approximate wait times. However, we recommend that you consult with the relevant institution.
Familiarizing yourself with processing times is essential, particularly when operating on an employee onboarding timeline, as South Africa’s Department of Home Affairs is not immune to delays. Incomplete or incorrect information may also contribute to delays in your application.
South African work visas are valid for three to five years depending on the visa type. Most employment-based visas can be extended or renewed (other than an Intra-Company Work Visa) on the condition that visa holders apply for extensions 60 days before the expiry of their current visa. The applicants must meet all of their visa requirements again for the extension to be approved.
As such, employers and sponsors need to stay up to date with any changes in visa requirements and criteria to sufficiently support their employees.
Additionally, you must submit your application in person or at any VFS Global Offices in South Africa, as you cannot submit extensions outside of South Africa.
The South African government introduced a digital nomad visa on May 20, 2024. This non-immigration visa will effectively allow non-citizens who are freelancers or self-employed to live and work in the country for a year. This can be a great benefit to employers, as it opens up the door to attracting and retaining a wider pool of international talent.
The details of the official application process have not yet been made clear as the official government papers have yet to be signed. However, the South African government has stipulated that applicants must earn at least R 1 million (approximately $56 thousand) to qualify for this visa category.
Visa holders who reside in the country for more than six months will be expected to register as taxpayers in South Africa.
An employee’s immediate family members such as a spouse or dependents (usually young children) may accompany them to South Africa. Employers should familiarize themselves with the visa process for dependents of foreign workers. This process could include a separate visa application process.
Work sponsorship could mean tax implications for both the employer and the employee. Employers have obligations including deducting employees’ tax from their employee’s income even when it comes to foreign workers. Ensuring compliance with all these factors is critical to avoid legal complications.
Sponsoring foreign workers in South Africa can be a complicated and rigorous process. Simplify the process of obtaining work permits and visas for your foreign employees while ensuring compliance with South African laws with Playroll. Our visa sponsorship support platform offers comprehensive support, from the initial application to renewal, helping you manage your global workforce efficiently.
Despite the ongoing debate over what constitutes an adequate minimum wage, it is a widespread tool in labor regulation, adopted by over 90% of countries globally:
Source: Statista, 2024
Worldwide, minimum net monthly wages vary from almost 2,500 U.S. dollars in Luxembourg to 68 dollars in Nigeria as of January 2024. Minimum wages must be seen in relation with price levels in a country. One popular way to measure purchasing power is the Big Mac Index.
Minimum wage regimes vary extensively worldwide, shaped by a complex mix of laws, institutional arrangements, and collective bargaining. They are not randomly assigned values but the outcome of negotiations involving a country's social and political forces—trade unions, employers' associations, and governments.
International discourse often emphasizes increasing minimum wages to counter in-work poverty, a sentiment that gained momentum during the COVID-19 crisis as essential workers' low wages came under scrutiny. With each country's approach reflecting its unique economic and labor landscape, the ongoing challenge is to strike a balance between protecting workers and fostering economic health.
Picture this: in some places, there's a single minimum wage that covers everyone, no matter the job—pretty straightforward, right? This is what we call a universal regime. It's like having one rule for all, usually set by the national government.
Now, in the European Union, for example, most countries follow this universal approach with a one-size-fits-all minimum wage. But then, there are places like the United States or Canada, where things get a bit more local. States or provinces set their own minimums, which can be higher than the national floor. So, if you're in California or Ontario, the minimum wage might be different than in Texas or Quebec.
And then, there's the sectoral approach—think of it as custom-tailored wages for specific industries. Maybe you're a barista, a construction worker, or a nurse; your minimum wage is decided by the norms of your particular field.
Whether it's a universal rate that blankets the entire workforce or varied sectoral wages, the idea is to ensure you get a fair shake for a hard day's work, no matter the zip code or job title.
Of the G20 countries, Argentina saw the largest increase of the net minimum wage from January 2023 to January 2024, with wages increasing by almost 140 percent. This must be seen in relation to the country's soaring inflation rates. The same can be said of Turkey, where minimum wages almost doubled from 2023 to 2024.
Source: Statista, 2024
Of the G20 countries, Argentina saw the largest increase of the net minimum wage from January 2023 to January 2024, with wages increasing by almost 140 percent. This must be seen in relation with the country's soaring inflation rates. The same can be said of Turkey, where minimum wages almost doubled from 2023 to 2024.
When it comes to minimum wage, it's not always a one-rule-fits-all situation. In many places, especially across Europe, how much you should get paid at the very least might come from a national law, but it's not just plucked out of thin air. The government usually chats with employers and unions to figure it out. Sometimes, when everyone can't agree, the government steps in and sets the wage itself.
Now, let's take a quick trip north. In countries like Denmark and Sweden, instead of one blanket minimum wage, they have special pay rates for different job sectors. Think of it like a menu of wages tailored to each industry. Even in countries like Germany, which jumped on the national minimum wage bandwagon in 2015, this sector-specific approach was the go-to for ages.
And then there's Uruguay, a standout place where sector-level bargaining sets the pace, even with a national minimum wage in play. These special cases show that when it comes to ensuring fair pay, there's more than one way to bake the cake.
Navigating miminum wage and staying compliant with ever-changing employment laws can be complex, but it doesn't have to be. Playroll is an EOR service that can help you employ, pay and manage international workers in 180+ countries. Our team of experts ensures on-time payroll for your remote workforce, every time, and ensures compliance with all local labor laws so you can focus on scaling your business.
Book a demo with our team to find out how we can help scale your remote team.
In South Africa, a benefits package will include mandatory employee benefits such as paid time off, Unemployment Insurance Fund (UIF), and overtime pay and may include additional perks such as retirement plans and health benefits.
Not all workers are entitled to the same benefits. Workers can be separated into full-time, part-time, and fixed-term contract employees or independent contractors.
Full-time employees refer to employees who typically work 40 to 45 hours per week. These employees generally receive a more comprehensive benefits package than part-time workers (employees who work less than 40-45 hours per week but more than 24 hours a week). An employee on probation is not guaranteed supplementary benefits but will still have access to statutory benefits. Employees on fixed-term contracts (individuals whose employment runs through a specified date) may be eligible for certain benefits depending on the agreement with their employer.
However, independent contractors (individuals hired to complete a specific task or project) do not qualify to receive benefits.
In South Africa, employee benefits include statutory benefits (benefits guaranteed by law) and supplementary benefits (additional privileges provided at the employer’s discretion).
According to the Basic Conditions of Employment Act, employees are guaranteed annual leave of at least 21 consecutive days (not including public holidays), one day for every 17 days worked, or 1 hour for every 17 hours worked.
The employee and employer must reach a mutual agreement regarding the timing of the leave. The employer makes the final call if a mutual agreement cannot be reached. Employers may only grant leave up to six months after the end of the annual leave cycle and may not offer payment in place of granting annual leave (except on the termination of employment).
Pregnant employees are entitled to at least four consecutive months of maternity leave. The clock on these four months begins four weeks before the expected birth date, but employees may begin their leave earlier than this. Employers are not obligated to pay their employees during this time; however, the UIF covers 60% of their salary for up to 121 days.
Employees may request to extend their maternity leave. However, this request must be accompanied by a medical certificate specifying the extension's expected length.
Companies are only required to offer a less generous ten-day paternity leave following the birth or adoption of a child. In an adoption case, the child must be younger than two years old.
Paternity leave is unpaid; however, employees may claim 66% of their regular earnings from the UIF subject to the maximum income threshold.
Based on the Basic Conditions of Employment Act, workers are entitled to the number of days they would regularly work in 6 weeks every 3 years. For example, someone who works five days per week will have 30 days in their bank of sick leave days every three years.
However, during an employee’s first six months, they are only entitled to one day of paid sick leave for every 26 days they worked.
Employers have the right to request a medical certificate before paying employees who take more than two consecutive sick days or are absent more than twice in 8 weeks.
Certain South African employees are eligible to receive paid leave under certain circumstances, namely, the birth of a child, to care for their child that has fallen ill, or upon the death of an immediate family member.
The term “immediate family member” only includes the following individuals in this case:
The employee’s:
To qualify for Family Responsibility Leave, an employee must work for longer than four months for the same employer and work more than four days a week.
South African employers are required to pay their workers overtime pay. Overtime is capped at 3 hours per day and 10 hours per week. Employees can agree to work up to 15 hours of overtime, but only for up to two months a year.
If employees agree to work overtime, their employer must pay them 1.5 times their standard hourly pay rate. Employees who regularly work on Sundays must be paid 1.5 times their regular wage. However, employees who do not usually work on Sundays must be paid double their regular wage.
An employee may agree to accept PTO in exchange for working overtime.
Both employers and employees contribute to the Fund, which is set up to offer temporary financial support in cases of unemployment, adoption, parental leave, or illness. Dependents of deceased contributors may also claim from the UIF.
The employee must contribute 1% of their remuneration to the Fund, and the employer must match this 1% contribution.
COIDA is a program that compensates workers injured or infected with diseases during their employment. This program covers dependents of workers who die on the job as a result of work-related accidents or contraction of occupational diseases.
The Skills Development Levy (SDL) is a tax imposed on businesses to develop and improve workforce skills. Unlike UIF, employees are exempt from paying SDL, but employers must contribute 1% of the total amount paid in salaries to employees each month.
Supplemental benefits (also called fringe benefits in South Africa) are not required by law, but can help you stand out as an employer and attract top talent. They include:
South African employers are not legally obligated to contribute to employees’ retirement funds. However, future planning is essential to any enticing benefits package.
In many cases, employees are given the option to contribute towards a retirement contribution system; employers in some industries make this a requirement. The idea is that employers invest a percentage of the employee’s remuneration in a retirement fund to provide employees with a source of income once they retire.
While South Africa’s public healthcare system is free, its quality is not comparable to private care. Medical aid is invaluable to employees’ lives as it covers medical services and healthcare expenses from private institutions.
Employers may offer their employees various health insurance systems, including medical aid schemes, hospital plans, and comprehensive medical coverage, to attract world-class talent.
In South Africa, there is no statutory requirement to give employees bonuses at the end of the year. However, it is commonplace to give employees performance-based bonuses in December. These bonuses are usually equivalent to one month’s remuneration.
In addition to drawing in the best talent, employee benefits offer various advantages, including tax breaks or incentives. For example, as of 1 March 2016, contributions made to a pension or provident by an employer on behalf of an employee are tax deductible. This deduction comprises the sum of both the employee and employer contributions.
Interfering with employee benefits in South Africa should be taken seriously. Depriving employees of the benefits they’re entitled to can lead to the employee lodging a case against the employer at the Commission for Conciliation Mediation and Arbitration (CCMA). Failure to comply with South African labor law is treated as unfair labor practice and can result in significant penalties.
Employers also have an obligation to report all work-related incidents. For example, work-related injury and contraction of diseases must be reported to COIDA and other relevant parties.
There are various perks you should consider offering to current and potential employees in addition to the benefits discussed above:
The COVID-19 pandemic made employers and employees aware of the advantages of working from home. These benefits include increased productivity, flexibility and improved work-life balance for workers.
Since the pandemic, there has been an upward trend in adopting remote work, so much so that some workers look exclusively for fully remote positions. If you want access to a broader talent pool, consider offering various work arrangement options such as partial remote work, hybrid work models, or fully remote positions.
Employees not restricted by rigid schedules enjoy a better work-life balance. Flexible work hours allow employees to manage their time in a way that reflects their personal needs and expectations. Increased flexibility gives employees more autonomy regarding how they spend their time. This will invariably increase productivity and employee satisfaction and will help manage stress.
Any competitive benefits package must include an element of physical and mental wellness. Employee wellness programs give workers access to resources that support their physical and psychological care. These include partnerships with local wellness institutions such as gyms, in-house counseling, and health and wellness workshops.
Employee expenses significantly contribute to overall business spending in South Africa. Stats SA found that employers spent about 14% of total expenditure on employees. These costs include salaries and wages, training expenses, and the mandatory and supplementary employee benefits discussed above. That said, South Africa has a relatively low employment cost compared to other countries – studies have shown that European companies can save up to 50% on staff by hiring South Africans.
Use Playroll’s free global employee cost calculator to get a detailed breakdown of mandatory employer taxes and contributions in South Africa and to easily compare different market costs side-by-side.
Managing employee benefits in South Africa can be complex, but Playroll simplifies this process. With a footprint in over 180 countries, our centralized platform streamlines onboarding, payroll, and benefits administration, and ensures compliance with ever-changing employment regulations. Partner with Playroll to attract and retain top talent with benefits tailored to meet the needs of South African employees.
Book a demo with our team to learn how we can help you offer competitive employee benefits packages to scale your team.
In recent years, the gig economy has seen a sharp increase as employers enjoy the flexibility of hiring skilled workers on a project-by-project basis. However, between 10-30% of US employers are misclassifying their workers, according to the National Employment Law Project.
There are a few reasons the authorities take this especially seriously:
While this guide focuses on U.S. regulations, businesses operating internationally should be aware that employee misclassification carries similar risks across many countries, with varying legal frameworks.
There are several distinct differences between full-time employees and independent contractors. Here’s a summary of the key differences:
If an employer misclassified workers as independent contractors, they may be required to pay back taxes, penalties, and interest on unpaid taxes. Employers may also be subject to legal action by the Internal Revenue Service (IRS) or other US tax authorities. Misclassified employees may not get tax benefits like the earned income tax credit if they are labeled as independent contractors.
Here are all the potential consequences of employee misclassification:
Misclassifying employees as independent contractors can trigger IRS audits. If the misclassification is deemed unintentional, civil penalties include:
If the IRS identifies fraudulent intent, additional penalties may include:
Employees can sue for back wages, including unpaid overtime and benefits, if misclassified. This may involve costly retroactive compensation for benefits like health insurance and retirement plans that the employee was entitled to
Besides pure financial cost, the long-term effects of being found guilty of employee misclassification can be devastating. Bad press, drawn out legal battles and the impression that you are treating workers unfairly will impact your ability to attract new talent and retain your existing staff.
How have cases of misclassification played out in practice? These prominent legal cases highlight how hefty the consequences of misclassification can get:
So, how can you be certain that you’re classifying your workers correctly? It can get surprisingly complicated to distinguish correctly between employees and independent contractors.
There are a number of tests in the US that can guide employers to distinguish correctly between the two. Two of the most relevant tests that businesses can use include:
The IRS distinguishes between workers under common-law rules according to the categories of behavioral control, financial control and the relationship between parties. Some questions the IRS asks as part of this test includes:
Get more details on the questions the IRS asks for each of these categories here.
Companies and individuals can also file IRS Form SS-8, requesting that the IRS conduct an official audit to determine a worker’s status.
In January 2024, the Department of Labor (DOL) published a final rule revising how employees and independent contractors are classified under the Fair Labor Standards Act (FLSA). The final rule looks at these six factors when distinguishing between contractors and employees:
Get more details on the economic reality test here.
This test looks at how the courts and the IRS have classified similar workers in your company or your industry in the past, rather than examining the nature of the working relationship. There are several conditions in this test, that could mean you have a reasonable basis for classifying a worker as a contractor.
These include, for example:
Get more details on the reasonable basis test here.
Employee misclassification is not unique to the United States and is an issue in many countries around the world. Employers should be aware of the labor laws in the countries where they operate and ensure that they are correctly classifying their workers.
Many countries have laws and regulations that are similar to those in the United States, such as tax obligations for employers. In addition, some countries have specific laws and regulations related to worker classification that employers must follow.
Employee misclassification is a complex issue with significant legal and financial repercussions for US companies. One way to avoid the penalties of misclassification, is to partner with a team of experts that know the rulebook when it comes to compliance.
An Employer Of Record like Playroll removes the risk of hiring full-time employees and contractors alike, in the United States and beyond. Dedicated legal and HR experts will help you correctly classify your workers, and convert contractors to employees if needed.
Playroll helps companies expand their teams worldwide and keep talented employees, with a robust infrastructure of established entities in over 180 countries, ensuring ongoing compliance.
So, which countries have free healthcare systems? Well, few countries offer completely free healthcare services. However, most developed countries offer government-funded universal healthcare systems to citizens and residents where most services are free, or low cost.
The United States is a notable exception of a highly developed country that does not offer universal healthcare. On a global scale, the World Health Organization has noted that the world is off track in making progress towards universal health coverage, with improvements to health service coverage stagnating since 2015.
Below, we have compiled a list of the top 10 countries with universal healthcare or public health insurance, considering accessibility, quality, and coverage of healthcare services.
Canada tops our list of countries with free healthcare systems. Medicare, the Canadian universal healthcare system, is publicly funded and run by individual provinces and territories.
Healthcare services are available to all Canadian citizens and permanent residents. Free healthcare services include doctor's visits, lab tests, hospital care, and prescription drugs.
The United Kingdom has a free and universal healthcare system called the National Health Service (NHS), which is praised for its accessibility and efficient primary care services. NHS free health care services are structured regionally and funded by the government through taxation.
All United Kingdom citizens and residents have access to comprehensive free health care services, including hospital care, medical consultations, doctor's visits, maternity care, mental health care, prescription medications, and more.
Australia stands out among the countries that have free healthcare. Known as Medicare, the Australian free healthcare system is funded through general taxation and offers essential healthcare services to citizens and permanent residents.
Residents have access to free basic medical services, hospital care, doctor's appointments, prescriptions, and some diagnostic tests. For high-quality services and faster access to specialists and elective procedures, Australians have the option of purchasing private health insurance.
The Norwegian universal healthcare system stands out among countries that have free healthcare because of low wait times, emphasis on patient outcomes, and quality of services. Norway’s healthcare system is funded through taxation and social security contributions and is available to all residents.
Free health care services include hospital care, prescription medication, and medical consultations. Individuals looking for additional coverage and faster access to services have the option to purchase private medical insurance.
Our Norway playbook can help you understand the country’s labor laws and regulations.
Germany is among the countries that have achieved universal health coverage through a government-run " sickness fund" that requires all citizens to have medical insurance. Germany's healthcare system is funded through a combination of taxes, social insurance contributions, and copayments.
That ensures all citizens and legal residents have access to comprehensive high-quality medical services, preventive care, long-term care, and more.
Listing countries with free healthcare is hard without mentioning France. Its universal health care system is reputed as one of the best in the world for accessibility, quality care, and efficiency.
Healthcare services, including hospital care, prescription drugs, and doctor's visits are available to all citizens, legal residents, and even visitors residing in the country for more than 3 months.
Sweden has made it to our list of countries with free healthcare systems because it has achieved universal health coverage with comprehensive healthcare services. The Swedish healthcare system is government-funded and is accessible to all citizens and legal residents.
Residents have access to many healthcare services, including hospital care, maternity care, preventive services, primary care, specialist consultation, and dental care for children and young adults.
Brazil stands out as the model of countries that have free healthcare. The Brazilian free and universal healthcare system is funded by the government and is accessible to any person in Brazil, including citizens, legal residents, tourists, and even refugees and immigrants.
Patients have access to free health care services at the point of care, including hospital care, outpatient care, vaccinations, surgeries, preventive care, and more.
South Korea is among the countries with the best healthcare systems in the OECD funded through government subsidies and monthly contributions from both employees and employers.
The Korean universal health system is accessible to all Korean citizens, residents, and even foreigners. The government-run health system covers 60% of healthcare costs and the remaining expenses are covered through a private health insurance fund.
Denmark closes our list of top ten countries with free healthcare. Denmark's free and universal healthcare system is government-funded through taxes and offers free healthcare services to all residents.
The country’s healthcare system is highly regarded for its patient-centric services, preventive care, and comprehensive access to medical services, including prescription medicine, doctor's visits, hospital care, and more.
Free and universal healthcare systems offer numerous benefits, but they come with challenges, including:
As healthcare policies worldwide continue to shift toward building free and universal government-funded healthcare systems, more countries are expected to join the list of countries with free healthcare.
That may impact where employees choose to live to access free or low-cost healthcare services or where businesses source talent to reduce workforce-related healthcare costs.
To help businesses navigate the challenge, Playroll offers HR solutions and Employer Of Record services for hassle-free management of a global workforce, including:
Book a demo with our team to find out how we can help you scale your remote team with ease.
An Employer Of Record (EOR) is a third-party service that handles employment responsibilities for your company, like payroll, taxes, benefits, and compliance with local labor laws. The EOR legally employs your global team on paper, while you manage the employee's daily activities.
EOR providers typically operate under these business models: using their own wholly-owned local entities, partnerships with local providers, or a combination of these two approaches. A wholly-owned EOR model means the provider sets up its own entities in each country and retains full control over hiring and payroll.
In contrast, some EORs partner with local vendors and outsource these tasks. While this can be cheaper for the EOR, it may lead to less reliable service for you. Wholly-owned entities has the following advantages:
Selecting an EOR partner with a robust network of wholly owned entities can give you advantages in all these areas.
It's important to find an EOR with transparent pricing. Some providers may have hidden fees, like onboarding and offboarding charges, which can increase costs unexpectedly. Look for an EOR that clearly communicates all potential expenses upfront, is straightforward in their invoicing, cost effective and offers a clear breakdown of what’s included in their pricing.
Lastly, they should offer flexibility in their pricing models that suits the needs of your business: this includes offering monthly charges for full-time employees over requiring annual commitments for lower rates.
The level of support an EOR provides can make or break your global employment strategy. Quick response times and hands-on support are essential, especially when dealing with complex issues like payroll queries or legal compliance in jurisdictions you might be unfamiliar with.
Before bringing an EOR provider on board, check their public reviews on platforms like G2 and Trustpilot. Additionally, ensure that the EOR offers dedicated support for your employees to ensure employee satisfaction and retention. Be sure to ask if dedicated support comes free of charge, as some EOR providers charge extra for this service.
Your EOR provider should have a strong presence in the countries where you wish to expand in the short-term and in the long run. In cases where they do not operate in your desired country, your growth might be hampered if you're locked into a contract you’re unhappy with. Some providers also charge fixed offboarding fees – it’s a good idea to ask whether this is the case before you commit to a provider.
Identify a company with comprehensive country coverage. For example, Playroll operates in over 180+ regions and offers the extensive coverage required to support your global ambitions.
An ideal EOR should help you hire both full-time employees and contractors legally. This flexibility is essential as your workforce needs may evolve over time. It’s much easier to use one service provider that can cater for all potential needs, than having to choose different providers to hire full-time employees and contractors.
Additionally, the EOR provider should be able to assist with classifying your workers correctly to avoid the penalties associated with misclassifying employees as contractors, and convert contractors to full-time employees if needed.
Check that your chosen EOR provider will support hiring different types of workers, in all the regions you’re interested in.
Competitive employee benefits are a key component of attracting and retaining top talent. Your EOR should offer a comprehensive benefits package that includes both local benefits and global options.
Enquire about additional services like benefits management and visa support. The more robust and flexible the benefits, the better equipped you’ll be to support your international team no matter any curveballs that might come your way.
Timely and accurate payroll is a non-negotiable part of your day-to-day operations when managing a global workforce. Having delayed and faulty payroll can result in great reputational harm to your business and potential legal fallout. Ensure the EOR has a proven track record of paying employees on time and offers a user-friendly payroll system.
Before committing, ask for a demonstration of how their payroll system works and whether it provides a clear view of all transactions in one place. Ask how their invoicing system works, as some providers can make this needlessly complex.
Your data should always be safe, and data security is an important consideration while choosing an EOR. Ensure this by checking the certifications the EOR holds, such as GDPR and SOC2, and inquire about the measures they take to protect your Intellectual Property. An EOR provider should guarantee that all contracts are compliantly set up to ensure your IP will belong to you.
Be wary of EORs that rely heavily on third-party partners since this can increase the risk of data security issues.
Compliance with local labor laws is one of the main reasons to partner with an EOR. The right EOR should have a team of experts on hand to help you navigate challenges such as employee misclassification risk, and meeting all compliance requirements in new markets. Again, be sure to check if the EOR provider has a track record of quick response times, as you might need fast support when it comes to questions of compliance.
Ask about their legal expertise in the specific countries you’re interested in and how they help you stay compliant with local regulations.
Employment contracts can vary across different regions and your EOR should be flexible to your specific needs and can create customized agreements if needed. Ask about their process for amending contracts and how long it typically takes.
Flexibility in this area ensures your contracts are aligned with both local laws and your business objectives.
Employee terminations can be difficult and complicated, making it a matter that should be handled carefully. Ensure the EOR has a clear and compliant process for managing terminations, including support for both the employer and the employee during the offboarding process. Understand this process thoroughly before entering into a partnership to prevent legal issues in the future.
If you're considering moving an employee from an EOR to one of your own entities, many EOR providers require a ‘resign and rehire’ process. During this process, the employee resigns from the EOR and is rehired by your entity. This approach can complicate the businesses’ relationship with the employee.
Clarify with the EOR if they offer a flexible transfer process.
Choosing the right EOR partner is fundamental for your business’s global expansion. Playroll stands out by meeting the criteria mentioned above, offering extensive country coverage at 180+ regions with a robust network of wholly owned entities.
Enjoy transparent, best-in-class pricing, dedicated support for employees and employees, and a flexible approach to employment contracts – with a team of HR, finance and legal experts on hand every step of the way.
Compare EOR providers and book a demo with Playroll today to explore how we can support your international growth.
In today's competitive global job market, crafting an appealing employee benefits package is no longer just an option, it's a necessity. This is especially true in India – with its diverse workforce, strategic geographical location and a population proficient in English, it’s an increasingly popular location for companies seeking skilled international employees.
Understanding the intricacies of employee benefits in India can set your company apart, helping you attract and retain world-class talent.
The landscape of employee benefits in India can get complicated, with a mix of government-mandated statutory benefits and optional fringe benefits. Partnering with a global HR platform like Playroll can make navigating this environment easier, ensuring that your company stays compliant while offering a benefits program that truly resonates with employees in India.
In India, the entitlement to employee benefits primarily extends to full-time employees. These individuals are covered under a range of statutory benefits mandated by Indian labor laws. However, part-time employees, contract workers, and those in more flexible employment arrangements may also receive benefits, depending on their specific employment agreements and the policies of the company they work for.
It's essential to recognize that while statutory benefits are designed to protect full-time workers, employers can choose to extend certain benefits to part-time or contract workers as a gesture of goodwill or to enhance their employment package.
An employee benefits package in India typically includes a combination of statutory benefits—those required by law—and fringe benefits, which are additional perks provided at the discretion of the employer. A well-rounded benefits package is vital for ensuring employee satisfaction and retention. In India, such packages often include health insurance, retirement plans, paid leave, and other allowances designed to support the financial security and well-being of employees.
Statutory benefits are the backbone of any employee benefits package in India, as they are legally required and ensure that employees receive essential protections and rights. Here’s a closer look at the key statutory benefits that employers must provide:
Maternity leave is a critical statutory benefit in India. Female employees are entitled to 26 weeks of paid maternity leave, provided they have worked for the employer for at least 80 days in the 12 months before the expected delivery date. This leave is designed to support women during and after childbirth, ensuring they have adequate time to recover and bond with their newborn.
While paternity leave is not mandated by Indian law, an increasing number of companies are recognizing its importance and offering paternity leave voluntarily, with periods ranging from 5 to 15 days.
Annual leave is another crucial statutory benefit. In India, employees are entitled to a minimum of 15 days of paid time off after completing 240 days of work in a year. This leave allows employees to take a break from work, rest, and recharge, which is essential for maintaining productivity and mental health.
Some companies may offer more generous leave policies as part of their efforts to create a supportive work environment.
Besides these mandated annual leave days, employees in India are entitled to 10 public holidays a year.
Sick leave is vital for employees who need time off due to illness without the worry of losing income. In India, the entitlement to sick leave can vary depending on state laws and company policies, but generally, employees receive around 12 days of paid sick leave per year. This benefit helps ensure that employees can recover from illnesses without financial stress, which in turn fosters a healthier and more productive workforce.
The Employees Provident Fund (EPF) is a cornerstone of retirement benefits in India. This statutory benefit requires both employers and employees to contribute to a retirement fund, which employees can access upon retirement or resignation. The standard contribution rate is 12% of the employee’s basic salary, with the employer matching this contribution. The EPF not only provides financial security for employees in their retirement years but also fosters a culture of savings.
Gratuity is another key statutory benefit in India, awarded to employees who have completed at least five years of service with the same employer. It serves as a financial reward for long-term service, calculated as 15 days of the last drawn salary for each year of service. This benefit is an excellent way for employers to recognize and reward the loyalty and dedication of their long-serving employees.
While statutory benefits are required by law, fringe benefits are additional perks that employers can offer employees to improve job satisfaction and retention. These benefits can vary widely depending on the company and industry but often include:
Medical insurance is one of the most valued fringe benefits in India. Many employers offer comprehensive health coverage that extends to employees and their families, including medical, dental, and vision insurance. In addition to these, companies may provide access to wellness programs and preventive care services, helping employees maintain good health and reducing absenteeism due to illness.
Beyond the mandatory Provident Fund, employers in India often provide additional retirement savings options, such as pension schemes or employer-matched retirement plans. These benefits give employees greater financial security after retirement and are a significant factor in attracting mid-career professionals who are planning for their future.
Performance-based bonuses are a common way for companies in India to reward employees for meeting specific goals or contributing to the company's success. These bonuses are often tied to individual or team performance and can be a substantial part of an employee’s total compensation. Offering performance bonuses not only motivates employees to excel but also aligns their efforts with the company’s strategic goals.
The rise of remote work has made flexible work arrangements increasingly popular in India. Employers are offering options like work-from-home days, flexible hours, and compressed workweeks to help employees achieve a better work-life balance while working from home. This flexibility is especially appealing to younger employees and those with family commitments, making it a valuable component of a modern benefits package.
In a country where workplace stress is common, access to a gym can help employees manage stress, improve physical health, and boost productivity. This benefit also demonstrates a company's commitment to the well-being of its workforce. For employers, such initiatives are valuable in attracting and retaining top talent in a competitive job market
Managing employee benefits across multiple countries, each with its own set of regulations and cultural expectations, can be overwhelming. That’s where Playroll comes in. With a footprint in over 180 countries, Playroll offers a centralized platform that streamlines the administration of employee benefits, payroll, and onboarding to your distributed workforce with EOR services.
Our platform ensures compliance with local laws and helps you design competitive benefits packages tailored to your global workforce's needs. Whether you’re managing a team in India or expanding into new markets, Playroll can take the complexity out of global HR management, allowing you to focus on what really matters—growing your business.
Want all the facts to hire in India with confidence? Check out our detailed country hiring guide.
Ready to simplify your global HR management? Easily manage employee benefits, payroll, and more for your global workforce in one centralized platform with Playroll.
Employers can now manage most tasks related to visa sponsorship on the employer portal, and get updates on where employees are in the application process at a glance:
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This update centralizes all your key employment documentation, making it easier to manage documents related to all your employees.
We’ve also introduced new controls for the various document types associated with your employees.
These controls allows for:
All uploaded documents are available on the employer portal under the "Employee -> Documents" tab, where you can also filter for specific employees. Additionally, employees can access these documents via their own portal under the "Documents" tab.
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If you have any questions on these product updates, don’t hesitate to reach out to your Customer Success Manager or contact us at [email protected].
Establishing a foreign subsidiary is the traditional route to expanding globally as a business. While it’s one way to grow as a company and establish your reputation as a global employer, the process can be lengthy, complicated and requires significant resources as a business.
This article will deep-dive into the pros and cons of establishing a foreign subsidiary and the steps involved in setting one up. Plus, we outline alternatives that can save significant time and cost when expanding into new markets.
A foreign subsidiary is a separate legal entity established by a parent company in another country. It operates independently but remains under the control of the parent company. Establishing such a subsidiary allows businesses to access new markets, mitigate risks, and optimize tax benefits.
Companies often choose between wholly owned subsidiaries, where they hold 100% control, partially owned subsidiaries, shared with local partners, or joint ventures formed in collaboration with other entities.
Companies typically establish foreign subsidiaries to access new markets, mitigate their risks and optimize tax benefits.
Types of Subsidiaries:
A foreign branch is not a separate legal entity and the parent company bears full liability for its operations. In contrast, a foreign subsidiary is a distinct legal entity, providing better legal protection and compliance independence. Understanding these differences is crucial for businesses to make informed decisions about their global expansion strategy.
Creating a foreign subsidiary can open up your business to permanent establishment (PE) risk, which subjects the parent company to local taxation and regulatory requirements. This risk underscores the importance of thorough research and compliance with local laws to avoid unexpected liabilities.
Establishing a foreign subsidiary involves high initial setup costs, ongoing operational expenses, and extensive research to ensure compliance with local regulations. The time-consuming nature of these tasks can strain resources and delay market entry.
Cultural differences may also pose integration challenges, impacting organizational cohesion. Additionally, closing down a foreign subsidiary can be a complicated and costly process, requiring careful consideration and planning.
Despite the challenges, establishing a foreign subsidiary offer benefits too. They provide access to new markets, enabling businesses to expand their global presence and reach new customers. Subsidiaries can also offer tax benefits, taking advantage of favorable local tax regimes.
By operating as a separate legal entity, a subsidiary reduces the parent company's legal risks. This structure allows for better division of labor and resource allocation, enhancing operational efficiency. Moreover, having a local subsidiary builds trust and credibility with customers in the new market, fostering brand loyalty.
Often, it makes sense to open a foreign subsidiary if you're planning to hire many new employees in a new market, to justify the investment in time and cost.
To establish a foreign subsidiary, businesses must conduct preliminary research into the target market to understand local employment practices and compliance requirements. Forming an expansion team and planning the hiring strategy for the new market is essential. Ensuring compliance with local labor laws will usually involve consulting with your own appointed team of legal, financial, and tax experts.
Deciding on the appropriate entity structure, such as an LLC or corporation, is a critical step. Securing funding for both setup and operational costs is necessary, along with appointing a board of directors and management team.
Gathering all necessary documentation, including business plans and legal agreements, and registering with local authorities are vital steps in the process. Finally, setting up operations involves hiring employees, establishing offices and infrastructure, and developing local partnerships.
For businesses seeking a less complex and cost-effective approach to hiring internationally, there are two alternative solutions:
Employing contractors allows businesses to manage overseas operations without establishing a legal entity, though it’s only suitable if you’re looking for support with short-term projects. Treating contractors the same as a full-time employee carries misclassification risks.
An Employer Of Record is a third party service that assumes all employer responsibilities on your behalf in new regions, handling payroll, taxes, and compliance with local employment laws.
It offers a route to quick market entry and vastly reduces the financial and administrative burden for businesses, offering an alternative to the traditional method of establishing legal entities.
Companies often use Employer Of Record services for the following reasons:
Playroll's EOR services can be a strategic solution for businesses looking to expand globally without worrying about the complexities of setting up a foreign subsidiary.
Playroll has a global footprint in 180+ regions, and teams of experts on hand to help navigate international hiring and ensure you stay fully compliant – with direct support for employers and employees, every step of the way. Hire, pay and manage a global workforce, all in one platform.
Speak to our experts to find out how Playroll can help you scale your global workforce.
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