Global Hiring

Costs & considerations when hiring internationally

May 17, 2024

There are several benefits of hiring top talent from around the world, including the ability to more easily enter new markets and gaining access to a larger talent pool of potential candidates. But before you begin international recruitment there are several financial factors to take into account, such as the cost of a global team’s salaries, taxes, employee benefits, and more.

Understanding the impact these variables will have on international employment costs is important in order for companies to create accurate budgets, and to offer competitive salaries when hiring remote workers in global markets.

Country-Specific Laws

Every country has its own local labor laws and regulations regarding mandatory benefits that impact the cost of hiring an employee in their home country. This could include pension contributions, vacation pay, taxes, health insurance, and parental leave.

For example, in Belgium, there are a range of mandatory employer taxes, including 24.9% of the employee’s gross salary for social security benefits. There are also mandatory vacation and paternity leave benefits that employees are entitled to, including a minimum of 20 days of paid vacation leave, 15 weeks of paid maternity leave, and one month of paid paternity leave.

Meanwhile, in Romania, employer taxes range between only 4-8% for social security benefits. Romanian employees are also entitled to a minimum of 20 days of annual leave per year, pregnant employees receive 126 days of paid maternity leave, and fathers receive 10 days of paid leave.

Currency Fluctuations

Because currency exchange rates are constantly in flux, a global workforce can make it challenging and time-consuming for your HR department to accurately calculate exchange rates and pay your international team in multiple currencies — especially if the process is manual.

Changes in currency exchange rates can also shift whether it’s affordable or costly to hire new employees in one particular country. For example, a strong US dollar (USD) against the Euro could make hiring in Germany more attractive for American companies. Conversely, a weaker US dollar against the Singapore Dollar (SDG) could raise costs for companies hiring in Singapore. But, if rates shift, that could change where it’s most economical to recruit new hires.

These currency fluctuations can make it challenging to accurately forecast global payroll expenses, and might lead to unforeseen cost overages. It could also result in errors in an employee’s pay.

Local Wage Rates

Local wages play an important role in the cost of hiring international workers, with factors like a country’s economic situation and currency value coming into play.

The average monthly income in Vietnam, for example, amounts to 7.1 million Vietnamese Dong (VND), which equates to approximately USD 280 for a country that is ranked 87th on the cost of living index. On the other hand, the average weekly wage in the U.K. is 2,702 British Pound Sterling (GBP), equivalent to USD 3,387 (as of May 2024).

While it’s important to understand the salary dynamics when hiring international workers, companies will still need to offer competitive wages to attract the best talent and increase retention, especially when competing with other global companies.


With global hiring, employers also need to meet the tax obligations of the countries where their international talent live — which can impact employment expenses. The intricacies of tax laws vary widely from country to country, so it's crucial for employers to be aware of the rules in each location.

For example, in Germany, employers may need to contribute to a social security system which covers robust health insurance, pension, and unemployment benefits. This leads to increased employment costs.

On the other hand, Singapore focuses on contributions to the Central Provident Fund (CPF) rather than hefty social security payments. The CPF acts as a savings plan for workers and impacts cost structures at a lower rate compared to Germany.

Employee Benefits

When hiring international employees, it’s key to have a firm understanding of the mandatory benefits offered in different countries and develop a global benefits strategy.

For instance, European employees often enjoy generous paid time off — with countries like France providing 25 days of paid vacation and 11 paid public holidays. In addition, many nations have generous mandatory parental leave policies in place. Sweden is particularly noteworthy for offering up to 480 days of leave for parents to divide between them while caring for their newborn child.

In Asia, countries such as Japan and South Korea typically offer a minimum of 10 and 11 days of paid leave respectively, along with perks that focus on maintaining work life balance and promoting health.

There is a mix of evolving benefits in South America. For example, Brazil mandates paying employees a full month’s salary at the end of each year, known as the 13th month payment. In addition, Brazilian employees are entitled to 30 days of vacation after completing one year of work.

Cost & Benefit Breakdowns by Region

Eastern Europe

In Eastern Europe, countries like Poland and Hungary are appealing due to their lower wage structures — but employer taxes can be significantly higher due to the social security tax employers are responsible for paying. For example, in Hungary the rate is roughly 13% of an employee’s wages, and in Poland the rate is 20% of an employee’s wages. The statutory annual leave benefits in Eastern Europe countries typically range from 20 to 26 days, excluding holidays.

Western Europe

Western Europe, including countries like Germany, France, and the U.K., is known for its higher wages and higher cost of living. The benefits offered in Western Europe go beyond the basics of health insurance and pension plans, although these costs are often shared by both the employer and the employee.

For example, in Spain, social security contributions are paid on wages and salaries. The minimum monthly base is EUR 1,260 and the maximum is EUR 4,495.50. The general contribution rates are 6.45% for employees, depending on the type of contract, and 30.40% for employers, plus a variable rate for occupational accidents (e.g., 1.50% office work).

Latin America

In Latin America, wage structures vary across countries. For example, Brazil and Chile offer lower average wages compared to Panama and Uruguay. Social security taxes can vary as well. In Panama taxes are 12.25% for employers, while in Paraguay it’s 16.5%. Benefits in Latin America also often go beyond what is offered in many other countries, like the 13th month payment.

In addition, the amount of leave in Latin America can range from 10 to 30 days, with an average of 15 days, in addition to public holidays.


In Asia, there are a wide range of costs associated with wages and benefits due to the mix of developed economies. Japan and South Korea have higher average wages compared to emerging markets like Vietnam and Indonesia, notable for their lower wages. Standard benefits across most Asian countries usually include health insurance and pension plans, with some countries providing perks such as housing allowances or bonuses.

Indonesia’s requirements for employer tax contributions are similar to Japan and South Korea, at approximately 11%. And while the average Vietnamese wage is lower compared to other Asian countries, the employer tax contributions are significantly higher, coming in at 23.5% of an employee’s salary.

Time off policies also vary greatly across Asia. For example, China offers 5 to 15 days of leave while India’s leave allowances can reach as many as 33 days.

The Benefits of EORs When Hiring Internationally

One way for companies to manage international hiring expenses and ensure compliance with all local laws regarding taxes and employee benefits is by working with an Employer of Record (EOR).

EORs like Remofirst eliminate the need for companies to open a legal entity in international markets where they are hiring remote employees. Instead, Remofirst assumes responsibility for all formal employment tasks, such as the hiring process for international candidates, running background checks, drawing up employment contracts, onboarding, running payroll, assisting employees with meeting visa requirements, applying for work visas or work permits, and managing employee benefits. We also partner with local HR and legal experts to stay up to date on each country’s employment laws. Meanwhile, your company is still firmly in control of your team members’ work environment and work hours.

Your global employees' hours, time off, holidays, bonuses, and commissions are automatically calculated into payroll via our platform, and we’ll pay your global employees on time and in their local currencies. That means no worrying about fluctuating exchange rates.

Book a demo to learn more about how we can help your company with its global employment needs.