The last 2.5 years have not only changed the ways in which we work, but also fundamentally altered the manner in which companies recruit and hire workers, particularly those operating in multiple locations globally.
Businesses have had to become more agile and flexible in their hiring practices; this, combined with a greater appreciation of the value of remote workers, has meant that on-demand hiring is increasingly seen as a cost-effective solution for global businesses.
What is on-demand remote hiring?
In today’s international markets, it can make more sense for companies to take on workers only when they are required for specific tasks or projects, rather than hiring them as part of a long-term, in-house team. On-demand hiring enables companies to employ workers for a particular project, when specific skills or abilities are required, or on a per-hour basis for a limited period.
It becomes especially appealing when in-house hiring takes too long or current staffing does not meet new capacity needs, whether due to increased demand, staff illness, maternity leave, or other absences. Rapid growth, expanding into new markets, or filling talent gaps are further reasons why global businesses commonly need to hire workers on demand.
On-demand hiring is also a highly effective way of taking on remote workers; it’s especially appealing for global businesses operating in multiple regions and jurisdictions. Similarly, remote workers are often looking for flexibility in their working arrangements — being hired on demand also suits their needs.
The process of hiring remote on-demand workers is made significantly more convenient by utilizing the services of Employer of Record (EOR) providers. As the market for these types of workers increases, it pays to learn more about the benefits of working with an EOR.
Benefits of on-demand remote hiring for global companies
Global businesses are discovering that they can derive a range of benefits from remote on-demand hiring.
On-demand recruitment means that urgent needs can be met more efficiently, increasing both capacity and capabilities at very short notice. In addition, on-demand recruitment often enables businesses to scale up and down as required, with fewer encumbrances in terms of labor laws, severance payments, and so on.
It can also reduce the risks and costs associated with hiring someone who doesn’t work out, making it more affordable for startups, SMEs, or other enterprises with more limited resources for hiring staff.
Hiring remote workers on demand also makes it easier for companies to look beyond their own workforces and national boundaries when recruiting, meaning they can draw from a global talent pool.
How on-demand hiring benefits remote workers
People choose to work remotely for a number of reasons, but one of the most common is that they want flexibility and greater freedom. On-demand remote hiring provides this, as it means engagements are usually for limited periods — workers are not tied indefinitely to a particular business, job, or role.
On-demand hiring also enables remote workers to showcase their talents to a greater range of global employers, as they have more freedom to move between companies and grow an international reputation. This can increase opportunities, career longevity, and value in the marketplace.
What’s the difference between an on-demand hire and a contract hire?
The essential difference between an on-demand hire and recruiting a worker on a contract is that the former will usually be employed through an Employer of Record (EOR), while in the latter scenario, a worker is employed directly by the business.
Most on-demand workers will be remunerated on a per hour or per project basis, while contracted employees will likely be on a salary, with all the additional benefits that accompany it.
What are the challenges of on-demand hiring, and how can you manage them?
Hiring remote workers on demand does present some challenges. Given that some of the most skilled and experienced remote workers are competing in a global marketplace, the short-term costs associated with an on-demand hire may be greater than they would be with a contracted employee undertaking the same role.
Over the long term, however, hiring a highly skilled worker to handle a particular project or fill a short-term skills gap will, in most cases, prove to be a more cost-effective choice. You derive the immediate benefit of their expertise without the long-term overheads that come with a contract.
The pace or duration of the onboarding process when hiring workers on demand can impact productivity, at least in the initial stages. Therefore, any business looking to hire these workers needs to have effective processes in place, ideally through well-developed HR practices and a partnership with an established Employer of Record (EOR) in order to make onboarding as efficient as possible.
There is also a case to be made that remote on-demand workers might be less committed to a company and its values than contracted employees, or that workers themselves feel less empowered and valued. It may also be that the protection of IP and data security are seen to be potentially more at risk when companies take on remote on-demand hires.
However, working with an EOR can help circumvent these and other issues associated with on-demand hiring for businesses that operate globally.
How an EOR provides solutions to on-demand hiring challenges for global businesses
One of the advantages of working with an EOR is that it will make the hiring process quicker and more efficient at a time when onboarding speed is often essential.
For instance, a common difficulty global companies experience when hiring on-demand and remote workers is being able to comply with local labor laws in jurisdictions where they haven’t established a legal entity.
An EOR provides a workaround solution. Instead of a company directly hiring a remote worker, it enters into a partnership with the EOR, who hires that person on the company’s behalf. The EOR is then technically responsible for that worker’s payroll, managing tax deductions and their ongoing conditions of employment, while the overseas company takes responsibility for the workplace role and responsibilities.
An EOR will also be responsible for ensuring that all employee data is accurate and protected and that appropriate anti-fraud measures are in place.
Partnering with an EOR similarly gives companies greater flexibility to expand into new markets without many of the associated costs and risks if such a move is unsuccessful, while also opening a global talent pool they might not otherwise be able to access.
In short, an EOR arrangement essentially means that companies can hire remote and on-demand staff anywhere in the world, even where they don’t have a legal entity established. This arrangement deepens the pool of skill and talent they can draw on without the significant costs usually associated with contract hires.
|Alexander Collins is a freelance advisor specializing in the expansion of software companies to new markets, labor compliance, and other global employment challenges.
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