Hiring a foreign worker can be a great way to bring new skills and perspectives to your workplace. But how much does it cost to hire a foreign worker? As will become clear, there is no exact answer to how much it costs to hire a foreign worker. This is because so much depends on the country of operations and what other costs might present themselves in addition to the person’s salary. In this blog post, we’ll explore the various expenses that come with hiring a foreign worker and give an overview of how employer of record costs fit into the picture.
Before we do so, however, let’s look at the definition of a ‘foreign worker’ and the specific meaning of the term as relevant to the global employer of record services market.
Generally speaking, foreign workers are individuals who are working in a country other than their own. They may be employed by an employer based in the same country as they reside, or they may work for a company located in multiple countries.
In other contexts, however, the term ‘foreign worker’ may simply refer to a person working for a company outside of the country in which that company is based. For example, a US company may refer to its employees in the Philippines as ‘foreign workers’.
For the remainder of this article, it is the latter definition that we are concerned with. Global employer of record services are especially relevant for companies that wish to hire individuals in countries other than the one in which they are headquartered or have branch/subsidiary offices.
The costs associated with hiring foreign workers are quite extensive and can vary significantly by country. Generally, employers need to factor in the following expenses:
One of the first costs to consider when hiring a foreign worker is the foreign worker’s salary. In many cases, foreign workers are entitled to the same wages as domestic workers per company policies, but in some cases it may be more appropriate to pay more or less than what local employees are getting paid. It’s also important to check local labor laws to ensure compliance with minimum wage and other remuneration regulations.
Additionally, some foreign workers may be eligible for tangential benefits, such as housing or travel expenses, which can add to the overall cost of hiring them. A good employer of record can advise you of what is mandatory and what is not when it comes to compensation in a given country of operations.
Another of the costs to consider when asking ‘How much does it cost to hire a foreign worker?’ is any visa and sponsorship fees. This cost will not apply to foreign workers who are citizens or residents of the country that you are expanding to (assuming non-citizen residents have work permits, of course), but if you wish to relocate a foreign worker from one country to another and they have no current status, they will apply.
Depending on the country of origin and the type of visa required, these fees can range from a few hundred dollars to several thousand dollars. For example, an H-1B visa for a skilled worker in the United States can cost upwards of $4,000 in fees alone (consisting of around $500 in fees for the employer filing the application, and $3,500 for attorney fees).
Additionally, many countries require employers to provide proof of financial stability and the ability to pay the foreign worker’s salary, which can add further costs to the process.
In addition to salary and benefits, there are also a number of other expenses that may be incurred when hiring a foreign worker. For example, you may need to provide training or language instruction to help the foreign worker adjust to their new job and environment. You may also need to provide support with finding housing or other necessities, such as health insurance. If the individual will work from home, you might need to provide a work from home allowance.
These costs can add up quickly, so it’s important to factor them into your budget when planning to hire a foreign worker.
If you are planning to hire a foreign worker in a country in which you do not already have a branch office or subsidiary with employment privileges, you will likely need to engage an employer of record provider to avoid the complications of trying to hire foreign workers as independent contractors.
Typically, fees for employer of record services include:
The exact cost of employer of record services can vary greatly depending on the country of origin and the provider you choose.
The most straightforward way to justify the long-term benefits of hiring a foreign worker is to consider what an incredible return on investment most foreign hires will provide. And we’re not just talking about potential savings when it comes to lower market rate salaries in other countries, either.
In many cases, foreign workers bring unique skills and experiences to the workplace, which can help your company grow and thrive. Additionally, hiring a foreign worker can help you tap into new markets and expand your business internationally. These benefits can offset the initial costs of hiring a foreign worker and provide a valuable return on your investment.
Hiring a foreign worker can be a valuable addition to your company, but it’s important to understand the potential costs involved. The answer to, ‘How much does it cost to hire a foreign worker?’ is not a simple one. But, by carefully planning and budgeting for the process, and considering the long-term benefits, you can hire a foreign worker in a cost-effective manner.
For more help in understanding the costs of hiring a foreign worker, contact a reputable employer of record in your chosen country of operations. They will help advise you on the most cost-effective way to bring on foreign workers and build your international team, as well as informing you about country-specific laws on compensation and other matters. To find an employer of record that could work for you, check out our detailed comparisons of EOR providers.
Top EOR Providers |
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| Provider | Overall Company Rating | Overall Employee Rating | Overall EOR Rating |
| Horizons | 5 | 5 | 5 |
| Deel | 5 | 5 | 5 |
| Remote | 5 | 5 | 5 |
| GoGlobal | 5 | 5 | 5 |
| Globalization Partners | 5 | 5 | 5 |
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