As a Professional Employer Organization, we help employers with difficult labour law issues in regard to their employees’ stays abroad, such as hiring abroad with German company headquarters or employing employees in Germany for foreign companies.
What is a PEO?
PEO stands for Professional Employer Organisation. This is a service company that allows employers to outsource certain tasks and processes related to the management of employees abroad without having a registered office in the country concerned.
How we support you as a PEO in your expansion abroad
As a Professional Employer Organisation, we can legally employ workers from another company abroad. All obligations that the actual employer would otherwise have, are handled by us according to the legal requirements of the target country.
Full service with IPS as your Employer of Record
Our Professional Employment Organisation, as a registered employer, also called Employer of Record, offers you full service in the areas of employee administration abroad in payroll accounting and social security contributions in accordance with the labour law provisions of the target country.
Our PEO is a way for you to have a company unit that takes over human resources tasks such as payroll accounting, payment of social contributions and payroll taxes for you, without you having to operate this company unit yourself. An innovative option that allows you to concentrate fully on your operational business without having to maintain a permanent establishment in the target country.
All formalities quickly delegated: Our service as PEO
You can immediately hire your employee in the target country – without any administrative or labour law work! As a registered employer (Employer of Record), we take care of all formal tasks for you, which the employment of a worker abroad entails, such as taxes or insurances. The work instructions for the execution of the day-to-day activites continue to be controlled by you.
Save costs and effort
Many companies save considerable costs with our Professional Employer Organisation, as our specialisation means that we due to our size we can work more efficiently and with less effort than our clients themselves. The scope of the desired services is determined in a consultation between us (the PEO) and the company placing the order. These services commonly include:
- Hiring of employees
- payroll accounting
- Paying payroll taxes, health insurance and social security contributions – Retirement benefits
- special benefits for employees
Time for day-to-day business
While our clients, companies like you, concentrate on their day-to-day business, we, as a PEO (registered employer), take care of everything related to the payroll administration of employees. We manage all legal and accounting requirements for you on a country-specific basis. You do not have to set up a company at the place of employment of the employee. We provide you with a company. You can also find more information here: our virtual companies.
Innovative Infrastructure with IPS as Global Employer of Record
We provide you with our innovative payroll solutions and HR infrastructure in over 120 countries. This allows your company to concentrate on its core tasks. We take over the usual burdens arising from employee administration with our comprehensive payroll service.
When things have to move fast
Are you expanding rapidly and want to be flexible in recruiting new staff abroad or sending existing staff on secondment? Then the service of a Professional Employer Organisation is the solution for your international expansion. One of our clients, for example, opened up approx. 40 countries, without having to set up their own branches in these countries. This was possibly through our help and was accomplished in 18 months. Whether just one country or many: We help you with the hiring of foreign employees and with international payroll.
With international payroll services keep employees motivated at all locations worldwide.
Working with a motivated, top-qualified team at all your (planned) international locations and outsourcing all the complex processes such as payroll, tax compliance and other administrative procedures to an international HR organisation – doesn’t that sound too good to be true? That’s exactly the benefit of our global Professional Employer Organisation. An international PEO allows companies to hire employees in a new location abroad, outsourcing legal hiring requirements and ongoing payroll.
Stable employment relationships – better performance
A stable employment relationship ensures satisfied employees and thus more stability and better performance. If you entrust a professional employer organisation with all the legal and bureaucratic tasks for personnel administration in the target country, everyone has more time to concentrate on the essentials: Your business!
IPS has experts on the ground for all legal issues
One of the biggest challenges for employers looking to expand abroad is understanding local regulations on payroll, employee benefits and national labour laws. With 15 permanent staff and offices in Spain, the UK, Mexico and the USA, and an established network of global experts, IPS offers professional services in over 120 countries around the world. Our staff and network partners are well versed in all complex issues and challenges.
These are your advantages versus setting up your own permanent establishment when you use the services of an Employer of Record (EOR) in the target country:
Setting up a registered business in a foreign country is a time-consuming and expensive process. With employee leasing from an international Professional Employer Organisation (PEO), employers can hire local workers without the cost and hassle of setting up a local operation. For companies, and especially high-growth start-ups seeking rapid global expansion, there is no better way to hire employees abroad quickly and in compliance with regulations.
Do you want to be present in your target market with global talent, as quickly and flexibly as possible? As an international professional employer organisation, we offer expanding companies the opportunity to be faster than their competitors and hire employees in a fraction of the time it takes to hire through traditional channels.
Non-compete and non-disclosure clauses
IPS also takes care of another important issue in contracts with foreign contractors. This concerns the incorporation and enforcement of non-competition, non-disclosure (NDA) and intellectual property clauses.
Who manages the employees?
The day-to-day business or all operational tasks of the employee are carried out by the employer, i.e. you.
PEO, EOR or GEO – what is actually the difference?
Basically, these words represent one and the same service for hiring employees in international markets. PEO stands for “Professional Employer Organisation”, GEO for “Global Employer Organisation” and EOR for “Employer of Record”. In any case, a global PEO service is the perfect solution for setting up a new business in a new country.
What sets IPS apart as a professional employer organisation is that we are transparent and cost-effective. We provide a platform to efficiently manage the international employment process and ensure clear communication between all parties or stakeholders.
A lot of experience is needed to make expansion a success
Let’s face it – hiring and managing a global workforce is a challenge, whether in an EU neighbouring country or on other continents, not to mention ‘difficult’ countries that bring extra hurdles. With a partner like IPS, who brings the expertise and expert network where it is needed most, you save yourself time, nerves and money. Whether you are looking for an American Professional Employer Organisation, an Australian PEO, a Mexican PEO, a PEO in Singapore or in South Korea: Our service enables you to properly and quickly hire, employ and pay your candidates in your target country.
Our specialisation and many years of experience allow us to work efficiently and cost-effectively in these difficult procedures. The exact services you require will be clarified in advance in a consultation between us, the Professional Employer Organisation and you, the company placing the order. In most cases, the desired services include
- Hiring of employees
- payroll accounting
- Paying wage tax, health and social security contributions
- pension provision
- special employee benefits
Entering new international markets is exciting, but can at times be overwhelming. You are eager to hire new employees quickly, but how easily bureaucracy and complicated laws can thwart your expansion plans! That’s where a Professional Employer Organisation like IPS comes in, to make your company’s expansion abroad smooth and easy. We have the basics and the global infrastructure to get you started right away!
All the advantages of working with a PEO at a glance
Through our existing network of legal entities, you save the costs of setting up your own legal entity or permanent establishment
With us, you can hire staff in new countries in hours instead of months. You benefit from the expertise of our local staff and partners and can thus quickly hire your new international team members and implement your expansion plans.
Comply with the law 100%
Leave the legal processes to us and use your time and budget to generate growth for your business.
Test global markets with flexibility
To get a reliable impression of the market opportunities for your products or services in certain countries, employees managed through IPS PEO services are an ideal way to test markets without having to place these employees permanently on your company’s payroll. This way, we provide you with easy and flexible access to more than 120 countries.
Without the support of a Professional Employer Organisation, you have to bear the risks of complying with local laws and administrative aspects such as taxes yourself.
More satisfied employees
It has been proven that companies supported by a Professional Employer Organisation have lower turnover rates. Satisfied employees always mean better business results.
Tailor-made payroll solutions with IPS by HRsolution
Every person and every company is unique, which is why we want to work with you as a trusted partner to develop an optimal, customised PEO solution for you.
IPS – Our services and obligations as Employer of Record (EOR)
If you want to reduce the risks associated with employing staff internationally:
By taking over your international human resources matters as an Employer of Record (EOR), we are legally responsible for the payment of international employees, as well as for benefits such as the payment of taxes and social security contributions as required by local law.
International employee payroll doesn’t have to be stressful with a simple outsourcing to IPS. We have a dedicated team that can take this task off your hands and take full responsibility.
Employee management: You can build your global workforce without having to worry about complex global onboarding processes yourself.
International knowledge: As our client, you always have access to our international experts with in-depth knowledge of international laws, regulations and cultural customs.
Global mobility: Whether you need a visa for your employees or want to relocate the workforce to your home country, we are familiar with all immigration laws and requirements. We can help you build, downsize or relocate your workforce to the country of your choice.
Global Payroll Services for companies of all sizes
Whether your company has just a handful of employees or thousands spread around the world: As a Professional Employer Organisation, IPS offers you complete, standardised payroll services in however many countries with however many employees you operate. Our clients include SMEs as well as large corporations – we will be happy to provide you with our references.
What does global payroll cover?
Payroll includes the monthly calculation of employee remuneration, the withholding of correct income and social security contributions, the administration of bonuses, commissions, expenses and social benefits, and the delivery of payroll to employees. The service also includes keeping the personnel file, paying taxes to (tax) authorities and insurers, and checking the working hours and holidays of the staff.
Global payroll may look like the same process that is carried out in virtually every single country, but it is of course much more complex behind the scenes. Tax and labour laws vary greatly from country to country. Managing the personnel data, the many calculations and expense reports to be tracked in different languages and different currencies is often quite a challenge!
With global payroll, salary from all over the world is consolidated in one place, the data is standardised and payments are calculated and paid out worldwide in the respective national currency in compliance with legal requirements.
The definition of a multi-country-payroll is the same whether a company has its own branch in the country where it hires employees, whether it works through an Employer of Record (EoR) (also known as an international PEO), or whether it hires independent contractors. The difference between a global payroll and a local payroll is that the required payroll steps for different countries can be done at the same time, which makes hiring and paying employees abroad much easier and clearer for all HR departments at headquarters.
Working with a PEO – the best option
An international Professional Employer Organisation like IPS by HRsolution is the best option for a successful expansion of your company abroad. We offer you tailor-made services, from complete HR administration and legally compliant contracts to global payroll.
Good for your business
A professional employer organisation (PEO) can help your business in a number of ways. First of all, working with IPS means that you can focus on your business priorities as you expand internationally. The more your company grows, the more you need to take care of your human resources department. You need to hire additional staff, and that means additional work. Not only that, but while you may have the budget to hire new staff directly responsible for international business development, you may not have the budget to hire an experienced HR team. By working with a Professional Employer Organisation, you benefit from all the advantages of an internal HR department without having to build or hire one yourself.
Your company remains compliant with the law
Employee-related laws are complex and constantly changing in every country. Only an expert or professional with a lot of experience is able to keep up with the regularly changing legal compliance requirements. When you work with a professional employer organisation like IPS by HRsolution, you can be sure that your company is compliant with the very latest changes in employer regulations without having to worry about keeping track of legislative changes yourself.
Benefit from experience without investing in your own HR staff.
Experienced HR professionals are an expensive investment, but one you can’t do without. By working with a Professional Employer Organisation (PEO) like IPS, your company gains access to top HR professionals and highly skilled lawyers who can help mitigate employment-related risks and provide your company with better people management than you could otherwise afford.
PEOs and other categories of HR outsourcing
A Professional Employer Organisation is a form of HR outsourcing. PEOs are differentiated from human capital management (HCM) software providers that offer tools for managing employee data and payroll, but do not take over employer duties. Professional employer organisations are also different from from employee leasing companies that do not offer the additional HR services beyond handling payroll and benefits.
HR issues abroad are complex, and so many small, medium and large companies choose to invest in outsourcing HR. Instead of spending thousands of euros to hire and set up an HR department in another country and spending a lot of time learning about legal and insurance issues, these companies benefit from qualified outsourced staff hired by a Professional Employer Organisation who is well versed in all local issues.
Relieve the burden on your own HR department
If you are a company with an existing HR department, you may not realise that outsourcing your international human resources could be a perfect solution for you. Many HR departments are understaffed and have a huge workload to manage. If you can’t afford to hire more full-time or part-time staff, but still need to handle important HR tasks, working with a Professional Employer Organisation (PEO) is the perfect solution. You benefit from cost-efficient, highly qualified employees and your existing HR team can focus on completing their tasks without being exposed to overload.
Benefit from the economies of scale of a PEO
Various insurances have to be taken out for new employees abroad. A global Professional Employer Organisation can often offer more cost-effective compulsory benefits than a single company due to economies of scale.
When you need support with recruiting abroad
Finding qualified employees with specific expertise in foreign markets is rarely an easy task. If you need temporary support in recruiting and onboarding new team members, IPS is there to help you. Of course, we also take care of all the necessary steps related to payroll and handle all issues concerning social security contributions, special benefits and taxes. You do not need to hire your own staff for this task. By outsourcing personnel tasks, you can rely on qualified employees and partners of IPS as a Professional Employer Organisation who will take care of your specific requirements.
What can you expect with new employees abroad?
Labour law and tax requirements:
Labour and tax laws differ not only from country to country, but also from person to person. The tax rate of each employee depends on numerous factors, including salary structure, age and marital status. In addition, laws are always subject to change – changes in legislation occur without warning. Languages and currencies vary from country to country, as do standards for bonus payments. In many countries, employers must pay a 13th month salary as a bonus.
The amount of data that needs to be collected and processed in an international payroll operation can be overwhelming. Each department at each location needs to provide time and attendance reports, expense reports and bonus and commission figures. Income can change each month, so the tax rate may be different. Benefit packages also need to be calculated. In addition, there are variable costs to be calculated such as expenses and commission payments to sales staff, thirteenth month salaries, annual bonuses and much more.
Complex reporting due to country-specific differences
Payroll records for a company’s entire global workforce – its own staff as well as employees hired through the Employer of Record (EoR) – are typically spread across numerous systems, spreadsheets and locations. If a company has employees in 10 countries, it may have up to 10 local payroll partners to ensure compliance in each of those countries. All these records are then separated from each other and stored in their own format, language and currency.
If a CFO or controlling wants to get an overview of total global personnel expenses, or even just compare the costs of two or more locations, payroll data must be retrieved from each source, the format standardised and currencies converted – a process that can take weeks.
Ensure data security
Data management and data security are inseparable. All payroll and payment processing must be handled with the utmost care in terms of data protection and security. Payroll data contains highly sensitive personal data that is protected by global standards such as GDPR in Europe and CCPA in the US and carries heavy penalties for data breaches. Payroll data is a desirable target for cyber criminals and requires the highest standards of data security and constant vigilance against future threats. IPS and its partner network keep these requirements in mind at all times and exercise the utmost care.
Which payroll is most suitable?
The process of global expansion starts with determining the right employment model for the project. The three main employment categories are working with an EoR, in-house payroll and the contractor model. If a company wants to enter a market as quickly as possible, an Employer of Record (EoR) allows it to pay its employees in full compliance with legal and regulatory requirements without having to set up its own permanent establishment. The workforce hired through an EoR can be supplemented by contractors for tasks that can be implemented independently.
If the company plans a long-term presence abroad, it can set up a company from the get-go, which can however take several months. In the meantime, it can hire through an EoR and switch to regular payroll once the new permanent establishment is set up – and if the global payroll provider offers both, it is an easy step.
Set-up a permanent establishment – yes or no?
Once a strategic decision has been made to enter a foreign market, the question arises whether to set up a foreign subsidiary or an overseas branch, or hire through a different model. The number of employees a company plans to hire abroad also influences the decision regarding the set-up. Usually, a workforce of 15 to 20 employees is sufficient to justify a shift from the EoR solution to payroll. Companies are then established enough to negotiate more comprehensive contracts with their local staff.
Cooperation models for global payroll services
If a company is considering switching from a decentralised manual payroll system to a unified global payroll system, it is important to ensure that the global payroll provider can process all employment types that the company is most likely to use. One collaborative model for companies to use in this regard is the aggregator model, such as the one offered by IPS. Here, the commissioning company enters into partnerships with at least one local company, the so-called in-country partner, which carries out the payroll – usually accounting firms or law firms. The in-country partner (ICP) is hand-picked and carefully vetted by us – essential when dealing with sensitive issues such as compliance and tax and labour law. The aggregate model also allows for maximum flexibility. If a company has a specific need, it can be matched with the right ICP.
Salary levels for employees abroad
One of the most difficult aspects of recruiting staff around the world is determining the optimal salaries. If salary offers are too low, the company is unlikely to attract the best talent. If the offers are too high, too much will be paid unnecessarily, reducing the return on investment. Again, savvy local partners are best placed to negotiate optimal salary levels for new employees. IPS by HRsolution offers you this service for more than 120 countries worldwide.
Continuous support in achieving your global expansion goals:
As your partner, we want to know your story and your ambitions.
We want to help you achieve your goals and to support new developments in your business as well as in the world so that your business thrives.