If It Looks Like an Employee, Talks Like an Employee, Works Like an Employee – It’s An Employee

Since Covid the global workforce landscape has changed dramatically.?Employees are embracing “work from anywhere “, while businesses are more open to the idea of “hire from anywhere” to take advantage of the global talent pool. Both work arrangements offer some amazing benefits and exciting possibilities, they also come with risks if not done correctly and compliantly.

As businesses dip their toes into global hiring, many are lured by the ease and low cost of hiring global talent as independent contractors, however this is a potentially costly mistake.

As I tell clients all the time, “You can call them independent contractors, consultants or whatever you want, that doesn’t make it true”.?It is very important that businesses review the select country’s definition of an independent contractor and an employee to ensure they are hiring them under the correct classification.?

Each country has very specific requirements and regulations around independent contractors, but some general themes are present in most countries.

• Are you directing their work? When and where to work? Looks like an employee
• Are you providing them their supplies (cell, laptop, etc)? Looks like an employee
• Are you providing them any type benefits (insurance, PTO, holidays, incentive pay, equity, etc)? Looks like an employee
• Are they getting paid overtime? Looks like and employee
• Are they working only for your organization??Looks like an Employee
• Is their work ongoing, as opposed to a set length??Looks like an Employee

As gig workers have increased so has government’s scrutiny over misclassified employees and the consequences can be hefty.?Not only will employers be responsible for back taxes, overtime, benefits, leave and additional pay, they can be hit with fines and even jail time.?In France infractions can bring severe penalties- Fines can range between €45,000-225,000 fine,?up to 3 years in prison, or even dissolution of the company or the inability to set up a French entity in the future.?

As companies hire globally it's important that they have all their ducks in a row.