It's recently come to my attention that I could possibly be rejecting perfectly good people as possibilities for employees. Anyone care to input?

I've always been told that anyone I hire MUST have a valid SSN and valid photo ID. I've also been told that I can not hire employees as 1099. I have located some materials online in relation to this:

Employment Determination Guide : http://www.edd.ca.gov/taxrep/de38.pdf
See Common Law Rules Section : http://www.irs.gov/publications/p15a/ar02.html
Immigration & Nationality Act : http://www.dol.gov/compliance/guide/aw.htm

By all information I am able to locate, my technical support & sales staff can NOT be 1099 Contractors, and must have a valid SSN & photo ID to comply with the I-9 form. This means there would be no way to hire an international employee who does not have a valid SSN/Photo ID. Is this correct?

Any input is greatly appreciated!

Thanks!

Instead of hiring employees or subcontractors, hire people who have a business and hire their business instead.

For example, some of our techs already own various online small businesses - such as a software company, hosting business on the side, etc. As long as they have a business Paypal account and are legally able to invoice us from their business - it works out MUCH better for both of us. We don't have to deal with any of the extra paperwork and they can write off related business expenses.

--Tina

This means there would be no way to hire an international employee who does not have a valid SSN/Photo ID. Is this correct?

I have worked for an US Company before in the past, I'm an UK Resident. I haven't heard of this problem before. The thing is, UK residents/Australian residents can provide photographic ID, and a SSN. Just not under an American citizenship.

This is from that Immigration & Nationality Act:

Under the INA, employers may hire only persons who may legally work in the United States (i.e., citizens and nationals of the U.S.) and aliens authorized to work in the U.S. The employer must verify the identity and employment eligibility of anyone to be hired, which includes completing the Employment Eligibility Verification Form (I-9). Employers must keep each I-9 on file for at least three years, or one year after employment ends, whichever is longer.

There is where I'm getting this from. Also, on the IRS website, it says pretty much anyone that does what, when, and where you tell them to do, they are considered an I-9 employee by the IRS, not a contractor or anything else. The only way I could see hiring someone with a business, is if I were to 'outsource' the support to them, correct? But I don't want to do that

That is ym view on it...you would need to outsource those positions. Honestly, especially with support, I find that this works quite well when covering the clock.

Australians in particular are quite good for being on the back side of the clock.

The only way I could see hiring someone with a business, is if I were to 'outsource' the support to them, correct? But I don't want to do that

Why would you not want to do that? Its exactly the same, except they would have the ability to do a b2b contract.

--Tina

.... and you do not have to hire, train and fire, then hire train and fire and repeat.

that in itself costs more than outsourcing.

oh , also you DO NOT have to worry about complying with the IRS, INS, etc... just pay the invoice.

.... and you do not have to hire, train and fire, then hire train and fire and repeat.

that in itself costs more than outsourcing.

oh , also you DO NOT have to worry about complying with the IRS, INS, etc... just pay the invoice.


I would never outsource support to a 3rd party support company. I always contract with an individual who has a business and no employees - so, there's still the issue of training.

--Tina

We do the same thing Tina mentioned -- hire only a business entity.

This completely avoids the issue of "contractor -vs- employee", and allows us to be much more adaptable to the changing needs of our business.

Plus it makes our books a lot easier, and it's much more flexible for the business we're hiring since they can write off all their own expenses, etc.

You must, however, be sure that they are a legitimate business. Your invoice should be written out to their business entity and not their name, etc.

You can have a contract with a company or an individual but not hire him, I guess. Hiring implies putting him/her on your payroll. This kind of an arrangement would be difficult to implement if your company does not have a branch in that location or country.

I guess the general consensus in the "internet world" is that most companies don't really feel that bound to the US rules? I don't mean that in a rude way or anything, but the laws, at least to me, clearly state that if you tell someone what to do, when to do it, and where to be/when, and give them some control over your company (answering phone calls, tickets, etc), then they are an employee, not a contractor, very clear cut.

If I were completely internet based, then I'd have less trouble using this ideology. However, I have a physical brick & mortar company, and offer services that aren't just on the internet (i.e. most of my clients are locals that come into my office for various programming/design work).

I guess I feel, everyone I hire, even if they are remote working from home, are technically working in my office and need to be properly handled in regards to the IRS, etc.
I would certain love to hire people oversees. I’ve met a lot of really good talent that I would love to take advantage of. Not to mention the fact that, yes, hiring someone in Australia would really help out my employees who are currently working overnights, which they don’t like ;) But I just don’t see how it’d be possible.
I guess I failed to mention that I do outsource my accounting/payroll work. I did have a chat with the lady in the office over there and she agreed that she wasn't sure how it'd be possible to do this.

I really appreciate everyone’s input and certainly appreciate any additional input from anyone. I'm going to explore this a bit more and see what I can come up with. The 'hiring-a-business-entity' type thing sounds very interesting. It'd almost be worth the investment to 'help' some certain individuals establish a business-entity just for this purpose. I'm certainly going to look into it.

I would never know if i would employee someone from another country.

I don't see how it would be a problem as long as you payed the needed tax. Phone up your tax office and ask them.

I don't see how it would be a problem as long as you payed the needed tax. Phone up your tax office and ask them.


Hiring employees outside of your area is a paperwork and tax headache. Its more trouble than its worth.

--Tina

Very interesting thanks for sharing.

I'd have to disagree slightly. Main reason being, if your company needs people that speak other languages, vast experience, work alternative hours or someone who is located in a country where you co-location your servers (if you do, as an example) then it would benefit the company to have someone close to the datacentre / wholesaler, which would make it cheaper and faster to operate.

I suppose if you had a location in another country, with servers/etc, then that part of your business would have to abide by the laws governing employment in that country.

As far as hiring someone from another country, to work for you here in the United States, it's more than a tax thing. There is a lot of enforcement on employers to verify the identities of the people they hire, to prevent illegal immigrants from getting a job. I have to fill out a I-9 form for everyone I hire, which requires me to get 2 forms of identification from the person (like a SSN & photo ID). I just don't know how I'd be able to do that for someone from another country.

I'm going to have a chat with my lawyer tomorrow to see what he says about the issue. I'll post my findings here.

Any findings yet ?

There are a lot of various job marketplaces, where you can find a lot of people from the Eastern Europe and taking into account the labour force in these countries is cheaper you can have good benefits from hiring employees outside of your country. I would advise you to search various job marketplaces.