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HR entrepreneur Mike Coffey, SPHR, SHRM-SCP engages business thought leaders about the strategic, psychological, legal, and practical implications of bringing people together to create value for shareholders, customers, and the community. As an HR consultant, mentor to first-stage businesses through EO’s Accelerator program, and owner of Imperative—Bulletproof Background Screening, Mike is passionate about helping other professionals improve how they recruit, select, and manage their people. Most thirty-minute episodes of Good Morning, HR will be eligible for half a recertification credit for both HRCI and SHRM-certified professionals. Mike is a member of Entrepreneurs Organization (EO) Fort Worth and active with the Texas Association of Business, the Fort Worth Chamber, and Texas SHRM.
Those are things that employers need to consider, especially when they're looking at resourcing talent in international markets. Because when it comes down to making that offer to that employee, you need to make sure that you understand, you know, what they already get from a legislative and governed type scenario. What are they already receiving? And then, okay, if we wanna make it better, great, then let's make it better.
Mike Coffey:Good morning, HR. I'm Mike Coffey, president of Imperative. Bulletproof background checks with fast and friendly service. And this is the podcast where I talk to business leaders about bringing people together to create value for shareholders, customers, and the community. Please follow rate and review Good Morning HR wherever you get your podcast.
Mike Coffey:You can also find us on Facebook, Instagram, YouTube, TikTok, or at goodmorninghr.com. For several decades, America's economy has become increasingly more integrated with the rest of the world. Once the domain of giant multinational corporations, many smaller firms now have offices in other countries and even on other continents. Sometimes this is necessary because of access to natural resources or unique manufacturing opportunities, but increasingly, access to skilled labor across borders is leading many firms to open offices abroad. And during the pandemic, many employers realized that some or all of their employees' work could be done remotely.
Mike Coffey:And many began to wonder whether if the work could be done remotely in the next state over, why couldn't it be done in labor rich markets around the world? But if you thought multistate employment was complex, imagine complying with the labor and tax laws of other countries. Which brings me to Texas SHRM's Global Business Conference. This one day conference will be held in Houston on September 19th. And joining me today to discuss global HR issues is the Global Business Conference's director, Meredith Morris.
Mike Coffey:Meredith is this current director of international development with the firm Global Expansion, where her focus is educating and supporting international companies to align strategies and solutions to mobilize and hire people resources globally. She is a SHRM certified professional and also holds the certified relocation professional and global mobility specialist designations through the worldwide employee relocation council. Welcome to Good Morning HR, Meredith.
Meredith Morris:Oh my gosh. Mike, thank you so much for having me here today, and what a fantastic introduction you just did. Wow. You're making me feel like a super star. I love it.
Mike Coffey:You are. You are. And
Meredith Morris:Thank you.
Mike Coffey:And you're the conference director, as I said, for the the Texas SHRM Global Business Conference. Give me the elevator pitch for that conference.
Meredith Morris:Oh, yeah. Thank you for that. So, yeah, so our elevator pitch for the conference is we are the only global focused conference on HR and business issues in all of SHRM, including Texas SHRM's. So it's a one day all global conference. So, yeah, that's our elevator pitch.
Mike Coffey:And it's in on in Houston on September 19th? I'll be there.
Meredith Morris:I know. It's gonna be great.
Mike Coffey:It's gonna be super, and I'll have a link, in the show notes so people can get more information and register.
Meredith Morris:Yeah. I know. I'm glad they're going to do that. Thank you for that, Mike, and I'm so glad you're gonna be there to represent. Right?
Mike Coffey:Yeah. Yeah. And Texas SHRM is you know, we've done that. How many years has it been that Texas SHRM has has sponsored this conference?
Meredith Morris:We are on year number 23.
Mike Coffey:Wow.
Meredith Morris:It started as you know, there is a history to everything. Right? I feel like we kinda have to share the history because, you know, it's a it's a little known jewel in our in our community that, you know, a lot of our professionals are not aware that this conference exists. And it's not a big, big conference. We keep it small, around, like, 200 professionals so that everyone has a a, you know, an opportunity to network.
Meredith Morris:But it really started as a concept by a small group of, you know, global HR professionals that were seeking more global content that were relative, you know, relevant. So 23 years ago, a small group got together and said, this is something we need. They pitched it to Texas SHRM, and it took off. And it's it's filled a very needed void, you know, for content across different types of practitioners, you know, in dealing with the global, even those that are new to global, like, maybe they've just now moved into a new market. Right?
Meredith Morris:They're looking at expanding internationally and in some of our more seasoned professionals and some of our larger organizations that have huge global footprints.
Mike Coffey:And the sessions are, approved for HR or HRCI's GPHR credit?
Meredith Morris:Oh, yeah. So every session is approved for GPHR credit and, of course, our wonderful SHRM credits. So for the SHRM CP and the SHRM SCP. But definitely, those that hold the GPHR, you know, it's very difficult to find areas or concentrations in a single day where you can grab numerous credits towards your certification.
Mike Coffey:So let's talk about this cross border employment. What situations lead US based companies to consider other countries' labor markets?
Meredith Morris:So, you know, I guess when you're asking that question, Mike, when you're talking about talent in an organization, it really has to stem from what the strategy of the organization is. Right? What is it that they're looking to do? Are they looking to offshore something? Are they really just looking for a specific skill set?
Meredith Morris:Have they won a project? So it's not just cross border. So cross border, you know, now that's becoming more common. Right? But then when we're talking, like, internationally, you know, a lot of companies are trying to source very hard to fill jobs.
Meredith Morris:You know, they have, you know, long days to fill with talent in other markets and especially maybe markets where they don't have an entity set up.
Mike Coffey:And so what kind of roles do you see most companies trying to fill on on an international basis? Because obviously, unless I build a warehouse or a manufacturing facility, people who are doing tab a and slot a physical kind of work aren't gonna be, who I'm looking at. So what kind of roles generally are being filled on an international basis?
Meredith Morris:Yeah. That's a really great question. And, you know, my organization and you already mentioned global expansion. But, you know, for us as a PEO, a specialized employee of record, you know, we fill all kinds of roles. So it really just depends again on that organization and what they're looking to accomplish.
Meredith Morris:So many times, it's opening a new manufacturing facility. You know, it could be that they're doing a project. Right? Maybe it's an infrastructure project. Maybe it is, you know, DOD, government defense based type, you know, contracting work.
Meredith Morris:Could be a financial institution, law firms. So, you know, there's multiple different multiple different titles. I don't know that there's really one sector or one type of title or one type of job that companies are looking at sourcing on a global or even cross border type situation. It really just depends on the need of the organization and what they're looking to accomplish. And that's what we're seeing.
Meredith Morris:We're seeing a lot more synergy and alignment and organizations with talent acquisition, you know, between the business units, business lines, leaders, you know, really trying to reinvent how they've done business and what they're going to do to meet those future needs of their organizations.
Mike Coffey:So let's say I'm an employer in the US and I wanna explore tapping into foreign labor markets. I mean, the first thing most people think about is h one b visas and bringing somebody to the US. But in the past, we've had, Dobrina Uston and Kevin Laschas both on the podcast, both immigration attorneys to talk about h one b's, and I mean, there's only 85,000 h one b fees is awarded each year, and that's for the entire country. So that's a very limited pool, and you know there's a lot of paperwork and things involved with that, and that number hasn't changed since 1990. So it's a crazy number and you know given the state of our politics it's probably not going to change anytime soon.
Mike Coffey:So what are the other options that somebody who's looking at okay. I need more labor. I'm not finding everything I need here. I'm, you know, I wanna look at alternatives to h one b visas, though. What are what are their options?
Meredith Morris:So it's you know, that's really it's been a great topic, and it's one that, you know, I have also covered with many organizations. So when we're talking about the h one b. It is a difficult process because it's a lottery system. Right? And they fixed some of the issues, and, you know, they've talked about it.
Meredith Morris:But when you only have 85,000 or 80,000 of those and, you know, you have 300 to 400,000 applications that come in
Mike Coffey:In, like, the first two days. I mean, as soon as the lottery's open, the yeah.
Meredith Morris:Your your success rate, you know, for that population that you're looking on that visa type is really tough. So what companies are doing, a couple of scenarios, sometimes they're parking them in what we call parking in, like, Canada, for example. So sometimes they will park this talent in another location, put them underneath another entity, you know, especially if it's, you know, an out you know, it's somebody internationally wanting to come inbound into the US. If they go into the Canada market or into Mexico, then there's someone on a similar time zone as the US companies. They can park them in Canada, for example, for up to a year, maybe longer.
Meredith Morris:And then within that year, they can start applying for their permanent residency in Canada. There are special programs that'll do that. We run a program like that for our clients. And then once they become a permanent resident of Canada, it's much easier to cross them over into the US. But the other yeah.
Meredith Morris:But the other thing that companies are doing is that if they do find specific talent, and I'm actually working working with a couple of organizations right now where they have some very specific role sets. They have identified some talent in an international market. They're actually going ahead and onboarding that talent, hiring them, and let's say, Bulgaria, you know, because it it's a specific talent or Germany or France or wherever that location may be. They're bringing them on as an employee under an EOR scenario. They can go ahead and start integrating that employee while they're still working to get their visas settled out into the US.
Meredith Morris:So we become a temporary stop gap so they can at least grab that talent, hire that talent, train that talent. And even though that talent's working remotely, then they're still working on their visa applications, finding the right visa type in order to immigrate them into the US in order to come to work for the organization, whether it's a long term assignment or a temporary type situation or permanent one way move. So, you know, those are just some of the different scenarios when you're talking about h one b specifically.
Mike Coffey:Yeah. But, and if we're not talking about bringing that person physically to the country Mhmm. You know, I assume we can still, you know, do the employer of record process, which I wanna get into more, But what's the disadvantage of just creating an entity in that comp in that country?
Meredith Morris:I think it's really just a personal preference. And typically what we typically what we tell companies or or what we work with them on and consult is that, you know, many companies, the traditional way, let's just go ahead and use the resources. Let's open an entity. Let's hire one person. Let's see how the market works, you know, market expansion.
Meredith Morris:And then maybe that market doesn't take off like it should have, and you've invested a lot. And and, you know, opening an entity, some countries is a little bit easier than other countries. I can't say that they're all gonna, like, be speedy fast. I mean, I don't open entities every all day long. But what I do know conceptually is that companies will lay that process down, potentially use an employer of record, and then they can hire that one person in that country.
Meredith Morris:And then once it gets off the ground and they get a certain number of employees, they'll go ahead and start that process to open the entity. And those let's even say it is it is a decided market. Like, the company's made a decision. Okay. We're going to be moving into Brazil, period.
Meredith Morris:We're opening up an entity. We're gonna move there. That may be a market that it could take 6 months to a year, but they might have client needs or desire to go ahead and get started. So many times they'll use, you know, an employee of record in order to go ahead and get market entry, legally have their people working on the ground and compliantly. Taxes are paid to the local authorities.
Meredith Morris:So you know, that tax governance piece, permanent establishment, you know, is mitigated, but it allows the company a faster speed to market entry while they spend that time and resources to open up the entity properly. And then once they have it open, we just transfer them back their employees.
Mike Coffey:And so the you you that you know, what depending on how what country it is and all the hoops you have to jump through to open an entity and whether that country even allows or an ownership of entities and what that involves, all those kinds of things.
Meredith Morris:Exactly.
Mike Coffey:They could, you know, they could do, you know, an employer of record, which I wanna again, we'll get to.
Meredith Morris:But Yes. Sorry.
Mike Coffey:As as as, you know, as the bridge until they create that. And depending on the expense and the local laws and things like that, I imagine there's, like, you know, there's obviously a cost to that. So you have to hit a critical mass of number of employees before it even makes sense to do that probably.
Meredith Morris:I would say so. Yeah. I mean but, again, you know, I've I mean, I talk to companies all day long, and it really just depends on the risk tolerance of the organization. You know, what's their anticipated, you know, footprint? What are they really looking to achieve with such strategies?
Meredith Morris:And, you know, everyone's everyone's strategy is different. Everyone's purpose is different. But sometimes having that flexibility and other solutions, you know, to allow for that expansion or allow for that quick market entry or allow for that entry or allow for that project to take place, you know, or to test that market out. You know, companies are looking at new ways of of really trying to to meet those goals. So why not just hire these?
Mike Coffey:And I'm asking a facetious question almost but I mean just like we see with US employers and multi state situations and why not just hire these people as independent contractors and just pay them under the table or something like that? Are there are there risks there? Or is it just vary from country to country? Or what's what's the issue there?
Meredith Morris:Well, no. Companies do it every day.
Mike Coffey:Oh, okay.
Meredith Morris:So it's a very common practice. You know, that independent worker, that contractor, or maybe using a large firm, that that will supply contract labor to them. You know, that's a very common practice and has been around for a really long time. I think when it comes to the independent contractor, there's always that risk of misclassification. And so a lot of companies, what they're doing, and, you know, I hear the story all day long.
Meredith Morris:You know, well, we haven't been caught yet. We've been doing this. You know? We have this this individual. And what ends up happening, we we have, you know, a rule of thumb.
Meredith Morris:It doesn't mean that anybody has to follow it. But, typically, we say, like, okay. If you're directing 25% of the work, you know, and this is an independent contractor, great. You know, it really kind of falls in that bucket where you're really that risk for misclassification is minimal. I mean, I'm not gonna say it doesn't exist because, you know, that's not my realm of expertise.
Meredith Morris:But when you start directing a 100% of the work, you're supplying the laptop, you're supplying the login. They have a somebody that that that is directing their work, that they report to, that is managing their time, that is managing their work, that is giving them performance reviews. They are no longer a contractor, And many companies are doing that on this independent labor. And so you have this, you know, potential for a misclassification and for the individual to come back and say, I'm not a contractor. I'm a full time employee, and I should be getting all of the same benefits that everybody else in my country gets because they're directing a 100% of the work.
Meredith Morris:Let me show you and I can prove it. So, you know, there's really just a fine line and it's still a very gray area, but it's still a common practice. And again, it really just depends on the specific needs of the organization and their tolerance of risk.
Mike Coffey:And I know Mexico, Canada, those are 2 that I have the most experience with have very different employment laws than the US does. And much more defined legislatively defined benefit structures, what's available for vacation, sick time, they've all got their own leave policies and they have paid leave in some cases. I think that's the it's just like independent contractors in the US, everything's fine while everybody's happy. I imagine most of the time employers get burned when somebody decides that well this employer is not treating me well or they fire me, so I go down and file unemployment or whatever the claim is in in this country and say this US company is, is you know, I work for them. What do you mean?
Mike Coffey:You know, they they owe this this tax. What do you mean I don't have benefits? And and and suddenly, now the employer's dealing with probably a very expensive situation with a foreign regulator.
Meredith Morris:Potentially. Absolutely. There's always being, you know, caught and fined, you know, for corporate tax, that wasn't paid in the country, potential lawsuits from the employee. I mean, you know, I think there's all kinds of different scenarios that could take place. But, you know, as you mentioned, you know, every country, how they operate their laws, their taxes, what the employees get, what benefits they get, it varies.
Meredith Morris:It's not the same. And, you know, and I work with a lot of US side companies that think that US side benefits can transfer over into an international market. So, I mean, like, 401 k. Okay. We wanna give this employee wanna give him 401 k.
Meredith Morris:I'm like, okay. Well, 401 k just doesn't really exist in other international markets, so we have to find a different solution. You know, maybe it's a pension fund. So those are things that employers need to consider, especially when they're looking at resourcing talent in international markets. Because when it comes down to making that offer to that employee, you need to make sure that you understand, you know, what they already get from a legislative and governed type scenario.
Meredith Morris:What are they already receiving? And then, okay. If we wanna make it better, great. Then let's make it better. You know?
Meredith Morris:That's fine. And I'll give you an example. I was actually working with a company. They're doing their 1st international hire, and they're like, okay. We wanna give this person 9 paid holidays.
Meredith Morris:And I was like, okay. But they get 12. They're like, but we only wanna pay for 9. I'm like, see. No.
Meredith Morris:You can't. It's 12. They get 12. It's it's governed by law, and here are the 12 holidays, and that's what you have to to recognize. Now if you wanna give them extra holidays, you can do that.
Meredith Morris:But you can't mandate, oh, I wanna give them this many holidays, or I wanna give them this much time off because they may already be allowed, let's say, 15 days as part of that requirement in country. Okay. We only wanna give him 10. Okay. We can't.
Meredith Morris:Yeah. You can give him 15. And if you wanna give him an extra 10, you can't. Really so those are the those are the a lot of the elements just not even can you know, not even going down the tax path or anything else. So that's just basics.
Mike Coffey:And let's take a quick break. Good morning. HR is brought to you by Imperative, bulletproof background checks with fast and friendly service. On August 23rd, I'm hosting a webinar entitled background check mythbusters. I've set aside an hour to tackle common misconceptions and questions about employers' use of criminal history, off duty conduct, background checks, and state specific laws.
Mike Coffey:Many of the topics are things I commonly encounter in conversations with HR professionals or see posted on social media. This webinar will be pre approved for an hour of recertification credit by both HRCI and SHRM. But do you have a nagging question you've never had a clear answer to or were embarrassed to ask? There are no dumb questions. Well, yeah, there are, but I know yours won't be.
Mike Coffey:Send me your questions when you register for the webinar at imperativeinfo.com. Also, I promise it won't be a sales job. I've learned over the last 25 years that our best marketing is simply trying to be helpful to the rest of our HR community. If you're an HRCI or SHRM certified professional, this episode of Good Morning HR has been preapproved for 1 half hour of recertification credit. To obtain the recertification information, visit goodmorninghr.com and click on research credits.
Mike Coffey:Then select episode 161 and enter the keyword global, that's global. And if you're looking for even more recertification credit, check out the webinars page at imperativeinfo.com. And now back to my conversation with Meredith Morris. So let's say we decide we don't want to create an entity and we don't take the risk of independent contractors. So we go to a an employer of record.
Mike Coffey:What's the difference I guess between what we can traditionally think of in the US as a PEO versus an employer employer of record? Or are they the same thing basically?
Meredith Morris:Yeah. So our vertical is PEO. So we're a professional employment organization just like banking is under banking, legal is under legal. So we're considered, you know, a PEO. That's the vertical that we range in, but not all PEOs are the same.
Meredith Morris:So you have some that are payroll only, like your your big players in the market. And then you have a company like mine, Global Expansion, where we solely focus on employer of record services. There are sometimes, you know, we may do some, like, local payroll depending on what that situation looks like, but our specialty is employer of record. And what that means is that this is not just a payroll. What we're doing is that if there's an organization that does not have an entity open in a foreign location where they're wanting to hire locals or move expats into that specific market, we can hire them underneath the local entity and employ them on that employer's behalf.
Meredith Morris:And we payroll them, and we will manage their benefits, and we can manage their time off. We put their employment contracts together. We make sure all the taxes are paid within country and any social burdens, and we make sure that we're managing per law in country. So we act as, like, an extension of the international HR department. And it can be confusing because they're like, okay, well, then they're they're not our employees.
Meredith Morris:I'm like, no. No. No. They're your employees. They're just under a different brand.
Meredith Morris:But the employer is still managing the employee. They're still dictating the work. They're still doing the performance reviews. You know, they can still manage the time off if they want to. They I mean, this person still reports to direct line manager.
Meredith Morris:So they're still their employee. It just gives the companies an alternate means in order to hire these people in that market.
Mike Coffey:So just to make sure that I'm clear, the in your case, let's say global expansion or any of these PEOs
Meredith Morris:Any of them.
Mike Coffey:EORs. They employers of record, they have, you've already have an entity in this foreign country most of the time.
Meredith Morris:There's an entity in market that's utilized.
Mike Coffey:And so and then so 15 different employer US based companies, you know, employees could be under that entity. They may they never talk to each other or have any interaction. It's just it's just on paper. Y'all are taking the responsibility for making sure taxes are paid and payroll's done and that the laws whatever the whatever the laws are there, you're just handling that compliance. So
Meredith Morris:That's correct.
Mike Coffey:Do does global expansion or do EORs typically do anything to help manage people? Like if they you know, like if I've got a PEO in the US and I've got a management problem, you know, I've got a performance problem with an employee, I can turn to the PEO and they can often help, you know, rectify that situation or something like that. Do y'all do that or typically is that left to the, the employer directly?
Meredith Morris:It's really the client's decision. It's really up to the client. But, you know, the one element I would say is that, you know, if there's an employee that they've hired because remember, these are their people. They hand selected them. They're there.
Meredith Morris:That I mean, they picked them. They hired them. They relocated them. They're they're the company's employees. They're they're not they're not mine.
Meredith Morris:Technically, on paper, they're mine, but they still remain underneath that direction. So, you know, really, the client has to drive how that takes place. So if there needs to be certain discussions, but, you know, the element that becomes really critical is that they can't terminate the person without interacting with us, because we have to make sure that we're following the law of the country, and that they're aware of what those practices are. And so we guide organizations through that and consult with them so that they understand that they do have that type of issue with a specific professional, that, you know, may not be the right fit that they've hired in a local cost is gonna look like from an employer perspective, because sometimes there are references that have to be paid out, vacation time that has to be paid out. There could be, you know, a 60 or 90 day notice period that has to be given.
Meredith Morris:So those are elements that we guide our clients on on a consistent basis.
Mike Coffey:Well, they're they're your employees then on paper at least and the but you get this I I'm seeing it as an entrepreneur in the in in the room and it's making me crazy thinking about this is like any other PEO, I guess, you're you're accepting a certain amount of responsibility that your client isn't an idiot. Right? And that they're gonna follow what you tell them is the law and they're not gonna get you sued because I assume as the PEO itself would have some concern for making sure, you know, there's probably all kinds of cultural expectations and things that might be recognized not in the letter of the law, but certainly the expectation God forbid you ever get that far. So y'all how do you mitigate that? How does how does the PEO and you have to about talk about global expansion specifically, but how how do you generally mitigate because I'm sure all your clients are are beautiful and intelligent, just like mine, but, how do you how does a PEO mitigate that liability internationally?
Meredith Morris:You know, it starts with the actual contractual terms, and, you know, all of that that set up, you know, especially when it comes to the liability. How is that gonna work? How is this process going to happen? You know, how are we gonna manage that? And so we feel like we've managed that the partnership in the beginning and that all, you know, the organizations understand how the relationship is going to work, then at that point, you know, that partnership becomes one that's very solid.
Meredith Morris:And communication communication is key. So and, you know, and and again, you only know what you know. I mean, just like most everyone I speak to, they think I know every in country law in 214 different countries and territories. I really wish I did because I'd be rich. And I really would because I would know everything.
Meredith Morris:But I don't. And so the reality is is that we have to utilize those experts and work as a team and as a partner so that together, we mitigate those risk. And, you know, it's it's it's not easy doing international. And you can ask a lot of these big global companies they know and even small companies starting to delve into it. It's complex, and it takes a team.
Mike Coffey:And I can imagine you're working with local legal counsel Yes. Accounting and finance people who understand all the intricacies of that, all those things that well, I mean quite honestly that most companies have to deal with in the US and just have you're replicating those systems. But you've got people you know on the ground that you trust and that you've got experience with. So when, you know, the US based employer doesn't have to go over there and and create all of that from scratch.
Meredith Morris:Right. Exactly. Exactly. And, you know, even when we do the employment contracts, because every person that comes on board with us, they sign an employment contract. The employment contract's in English, in the local language.
Meredith Morris:But, you know, then we try to we can make some changes to the employment contract, but then the employee's signing that so that there's clarity in the very beginning with these professionals of what that employment's going to look like, you know, what's being offered, what the regulations are, and how this process is going to work. So again, it's really just education, communication, partnership, you know, and clarity, clarity from both from all sides really to to make sure that you you started off on the right foot. I think that's like with any business.
Mike Coffey:And so we get where we're ready to hire somebody, or we wanna fill a position. Does the employer of record generally do their recruiting? Who's who's looking at the, you know, in Turkey, the Indeed of Turkey, whatever that is, and trying to find this engineer or whatever. Who generally does that recruiting and and selection? I can imagine you've got translation issues and all kinds of things.
Meredith Morris:Yeah. From our perspective, you know, as far as our organization and all all companies are different, you know, we don't do the recruiting. So we're not a recruiting firm. We're not a staffing firm, and that's not our specialty. Now we work with partners that we recommend.
Meredith Morris:Okay. But most organizations that we deal with, one, they'll either have an in house recruitment team, which is great. 2, they probably have a recruiting firm that, you know, that they've built some type of relationship with or that
Mike Coffey:overseas in this area.
Meredith Morris:Exactly. Or the third means is that, you know, we'll connect them with a local team or a global type provider where they can source that talent. So you know? And then we work closely with them as they continue to move through those candidates so then we know where they're at in the process and we know when their start date is so that we can start putting those employment contracts together and getting ready to onboard them for their start date and have them start. But yes.
Meredith Morris:But, I mean, for our model, now other employee records, some of them actually do staffing and recruiting. Some of them run into these other lines, and, you know, they're competing in that specific space, and then they're offering this as well. So, you know, every every one of us run our operations just a little bit differently.
Mike Coffey:So those are things that a company needs to an employer or US based companies to be asking and trying to figure out all those details about who's liable for what, how you know, who's responsible for whatever we need done, and how how do we go about doing that?
Meredith Morris:Exactly. It depends on how their process is because we're not asking anyone to change the process. You know, if we need to help them, you know, and support them in different ways, great. Then we can. But, otherwise, you know, we're really here just to assist in that process and supplement to to help them meet their strategic goals.
Mike Coffey:And you mentioned earlier in passing the the risk of, you know, permanent establishment in a country.
Meredith Morris:Mhmm.
Mike Coffey:And, I think what that means is that you've got enough business in that country that they're gonna be looking at you like your, you know, French company or an EU based company or a company in Turkey or wherever and have some application of Turkish law and tax law and everything else apply to you. Are there circumstances where an employer in the US using working through an employer of record may still risk permanent establishment just because of the size of their workforce or something like that?
Meredith Morris:Potentially. You can never erase that risk even with an employer of record. I would like to say we could win a 100% guarantee it, but there's no guarantee in any country or any market. What we do know is that the process and the way that we layer and how we employ, you know, our our professionals on their behalf, it mitigates the risk.
Mike Coffey:Interesting. Okay. So yeah. Because I know, you know, you read every day about some US tech company getting nailed by the EU governing, bodies for, you know, these Byzantine requirements they've got. And so if they're not coming for you yet under this EOR, it'll be a matter of time before they find try to find another way to to tax or collect.
Mike Coffey:I mean, you know, government that's what government's good at. Right? So, you know, I I'm sure that's something that all your local legal counsel and everybody else is always watching to make sure that, okay, this little this little change in the law has has happened and, you know, we have to reevaluate what it means to all our current contracts.
Meredith Morris:Yeah. Sending your business travelers in on tourist visas, performing work consistently over a 6 month time frame, they're probably eventually going to get caught. Yeah. And Yeah. You know, thinking that you can use these digital nomad visas that are meant for tourist type situations or, you know, Schengen tourist type visas, you know, for the Schengen area, but you're going in and working for clients, eventually, you're gonna get tacked.
Meredith Morris:And it's only because of the immigration system and they've gotten smarter and everything's electronic and now they can really track your employees. So yeah.
Mike Coffey:And I've I've even seen that happen in Canada. I've got a Oh, yeah. I've got a I've got a good friend who owns her business. She does training, really specific kinds of sales training, and she had a Canadian based client who she was always here doing work for them remote, you know, doing online training things like that. But they asked her to come speak at one of their conferences and she's crossing the Canadian border and they routinely asked her you know why are you coming across and she didn't even think twice about I'm coming to speak at this conference for one of my clients.
Mike Coffey:And they walked her right back across the border. I mean it was and and barred her from returning for some period of time. I mean it was a hard they were they were hard nosed about it and she was shocked just because I'm just going to speak at a conference and so but and so I can imagine and Canadians are the nice people so there's places around the world that would be even harder right? So so to wrap up one of the big issues that you know, we talk about even, you know, in the US are, you know, cultural issues and dealing with, you know, diversity and all of that. I I can only imagine how much harder that is when you're dealing with a US based manager and employees in another country.
Mike Coffey:What what are common kind of cultural issues, that employers encounter and what what's typically the, you know, the prescription for trying to resolve that?
Meredith Morris:You know, that's a really great question because you're right. I mean, people work differently globally. Right? Not all culture is the same. We don't all work the same.
Meredith Morris:And so, you know, really trying to understand those nuances is important. And you asked me the question. I would say, you know, understanding that culture and how they operate as a business before making that decision to start hiring those individuals. Because, you know, there could be cultures where, you know, it's it's really about, you know, where your ranking is within the company, what your title is, and then how that sequence of reporting goes. So there could be you could have, like, a group meeting and maybe a less senior individual would be hesitant to speak during that meeting, whereas a more senior one typically does all of the talking.
Meredith Morris:You know? So I think that knowing that there's different nuances and being able to understand that and listen. And there actually are companies out there that do cultural training for businesses, and they teach them business etiquette and both sides. Okay. It's not just the US side, but it's also culturally on your employees that are in those specific markets as well and immersion training.
Meredith Morris:So So
Mike Coffey:that they understand what, you know, when they're talking to this guy from Texas, they understand what I'm talking about. Yeah. Okay. Interesting.
Meredith Morris:The hardest and I would say the hardest thing to do is that a lot of times, especially we as Texans, we'll say things like, you know, I mean, we have these little innuendos and we'll say different things like, you know, that's not my first rodeo. And they're like,
Mike Coffey:what
Meredith Morris:do you mean? What kind of rodeo? Where did they rodeo? What's a rodeo? And but what we really mean to say is, you know, that's not my first time having that specific experience.
Meredith Morris:So learning how you use your language, that's, like, really big too. Because even, like, my UK counterparts, I can tell you when I started with this organization and I was on a call with one of our people, and he's sitting there and he's talking, like, you know, smart shoes and, you know, the, like, jumpers. And I was like, jumpers and smart shoes? Like, what do you mean?
Mike Coffey:Car is wearing a boot? You know, what do you mean the car is wearing, you know, as a boot? What? Yeah.
Meredith Morris:Right.
Mike Coffey:No. And in the English, my sister married a Brit and, who I love because he gave me an amazing nephew, but they they state facts as questions. They'll say something and then they'll say isn't it? And I don't know if I'm supposed to answer yeah it is or is that just rhetorical And so, yeah, those kind of things just Yeah. It just happens.
Mike Coffey:Yeah.
Meredith Morris:Yeah. It just happens. So realizing that your language really and how you formulate your sentences and words that you say, it it truly is. I mean, it's it's truly a different experience. So yeah.
Mike Coffey:Yet yet another reason to work with an expert who understands that country and can can help guide both parties through that.
Meredith Morris:100%. Of course. Yes.
Mike Coffey:Well, Meredith, that's all the time. That's our half hour. We're I
Meredith Morris:love that.
Mike Coffey:Thank you so much for joining me. I really appreciate it.
Meredith Morris:Thank you so much for having me, Mike, and thank you so much for promoting the Texas SHRM Global Business Conference, September 19th. And thank you for allowing me to be here today. I enjoyed this time with you.
Mike Coffey:It was fun.
Meredith Morris:It was fun.
Mike Coffey:And you can get more information about the Texas SHRM Global Conference on September 19th at texasshrmglobalconference.org. And again, it'll be in the show notes. And thank you for listening. You can comment on this episode or search our previous episodes at goodmorninghr.com or on Facebook, Instagram, YouTube, or TikTok. And don't forget to follow us wherever you get your podcast.
Mike Coffey:Rob Upchurch is our technical producer, and you can reach him at robmakespods.com. And thank you to Imperative's marketing coordinator, Mary Anne Hernandez, who keeps the trains running on time. And I'm Mike Coffey. As always, don't hesitate to reach out if I can be of service to you personally or professionally. I'll see you next week.
Mike Coffey:And until then, be well, do good, and keep your chin up.