Labor shortages have been felt in many sectors, particularly in manufacturing and agricultural industries in Norfolk, where since Covid-19 it has been incredibly difficult for businesses to fill vacancies.
The challenge of rising inflation and falling value of the pound has forced companies to face increasing financial pressure. In this time of economic uncertainty, business owners are looking for ways to secure their future.
One option open to Norfolk businesses is to consider recruiting from overseas or outsourcing services to international workers.
In 2021, this strategy was adopted to help alleviate labor shortages in agriculture and social services during the pandemic. In December 2021, the government announced an extension of the UK seasonal agricultural worker visa scheme, to allow foreign workers to fill employment gaps (Financial Times).
To help SMEs find the answers they need, specialist in international payments, Clear Currency explores some of the things you might need to know about hiring employees overseas.
Q: What are the benefits of hiring international workers?
A: Hire international workers offers many opportunities for innovation, increasing diversity and establishing a rewarding corporate culture (CXC Global). Hiring people of different nationalities and backgrounds will bring new ideas and perspectives that can help your business grow.
You can also find people with unique skills that your business could benefit from. Creating a wider recruiting network can help you find the best candidates for your positions. It could also help you save money, while offering a competitive salary for the position.
Q: What will Norfolk businesses need to consider if hiring remote workers overseas?
A: Remote work has become increasingly popular since Covid-19. New digital technologies allow employees to stay connected and productive no matter where they are, and make it easier for businesses to accommodate employees from diverse locations.
Any SME considering recruit teleworkers abroad will first need to determine whether they wish to recruit them as full-time workers, contractors or sole traders. If you hire several full-time employees, it may be better to create a legal entity in their country.
You will also need to familiarize yourself with the labor laws of that country. The WE, for example, is a federal system, with each state operating under its own jurisdiction. It is essential to understand how this could affect your business in order to avoid costly litigation.
When recruiting overseas, you will need to advertise the vacancy on international sites or work with a global recruitment agency. It will be necessary to draw up an employment contract for foreign workers which includes their salary, conditions, notice period and tax deductions (Safeguard Global). An international human resources company can help you create a compliant contract that will cover all relevant details and minimize the risk of complications.
Q: Will international workers be taxed twice in the UK?
A: Most employers who take on workers overseas will need to seek permission from HMRC to set up a net tax credit scheme. This can help them avoid having to deduct UK PAYE and foreign tax on workers’ wages (AAB).
Some countries, like France, have tax treaties in place to avoid double taxation. It is worth speaking with legal and tax specialists who operate in your employee’s country of residence to fully understand the tax rules that may apply.
Q: Can you hire foreign workers after Brexit?
A: Yes you can, although Brexit has affected how you can employ international staff. If you’re looking to recruit outside the UK, you’ll probably need a sponsor license. You can request it from gov.uk. Where you recruit and what role you advertise will impact which visa you will need. These processes can take time, so it’s important to plan and set aside enough time when offering someone a job outside the UK.
Q: How is the rising cost of living affecting recruitment in the UK?
A: Rising energy prices and inflation rates have a profound impact on UK businesses. Bankruptcies in the manufacturing sector rose by 63% last year (The Guardian) and led to the closure of two fertilizer factories in Teesside and Cheshire (Financial Times). The UK economy is expected to remain in recession throughout 2023 and into the first half of 2024 (BBC).
This means that many UK businesses will be eagerly looking for ways to save money and may consider hiring a global workforce to help lower their operating costs. Outsourcing administrative tasks to talented foreign workers can help companies save time and money (Team Bonding).
Business owners will also need to review their operational structure to increase efficiency, productivity and profits.
Q: How can UK companies pay overseas workers?
A: When hiring overseas-based staff, it is crucial to pay them on time and in the correct currency.
If you are new to the world of currency exchange, managing a global payroll can seem overwhelming. However, an international payment specialist like Clear Currency can make it easier to manage. When creating a free account, you can use their secure online platform to make transfers in 35 currencies.
When making cross-border payments, it is also important to mitigate exposure to currency risk. Currency values rise and fall by the second, and even the slightest fluctuation can make a big difference in cost.
Clear Currency specializes in helping businesses understand the FX tools available to help them save money and protect against market volatility. Their dedicated account managers are never more than a call or email away. Register for a free account today.
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