Contractor Management Company

Contractor Management Company

A contractor management company (CMC) provides outsourcing of payroll, workers’ compensation, human resources and employee benefits administration.

They are specialised in dealing with contractors, freelancers and interim workers. They can also arrange work permits and work visas for qualified international candidates. To summarise they are a packaged solution for ensuring compliance with tax, employment and immigration law.

CMCs are especially popular with recruitment businesses, employers, consulting firms and individuals contracting internationally.

We can help you engage with a management company based on your requirement and their specialisation. We have partnerships with all of the major international providers and have assessed their services. If you contact us with details of your need, we will give you a free assessment that outlines your options and recommended vendors. It is then up to you if you wish to take it further.

Why would you use a Contractor Management Company?

If you aren’t happy with your answers to the following questions…

Do you have the resources to have a Global Mobility department with full responsibility for International Assignments?

Do they cover all the destinations where you hire and source contract labour?

How do you currently ensure compliance on cross-border work?

Then you should talk to us!

The benefits to the client are numerous :

  • clear delineation of liability, obligations and responsibility for the employer to the individual
  • assurance of compliance with employment, immigration and taxation law
  • reduced costs & clearly defined pricing structure
  • reduced administration
  • increased flexibility and mobility
  • access to professional HR services including claims management for workers’ compensation and employers’ liability
  • full compliance on such issues as payroll, Equal Opportunity Employment, Occupational Health and Safety, Anti-Discrimination practices, locally agreed Workplace Agreements & Employee Handbooks.
  • can offer better benefits package and remuneration to contract employees

For Contractors, the benefits include:

  • better comprehensive benefits
  • accurate and rapid payroll processing
  • access to full resources relating to labour regulations, workers’ rights and Occupational Health and Safety
  • full statutory protection and insurance cover
  • clear and consistent policy

Why do people use PEOs for their international contractors?

1. Money

Costs of scale mean they can deliver the same benefits (or better) than your in-house resources but at a lower cost. Especially if you’re looking to establish in a new destination the cost of entry is often prohibitive.

2. Time

If you have a business need or urgent project do you have the time to properly investigate and establish the necessary structures to run staff in a foreign locale?

3. Risk

The risks of not doing the proper research in this area are potentially devastating.

  • Your company could be assessed as a “permanent establishment” in the location of business requiring it to pay local corporation tax on any business derived in that country. Does the jurisdiction have a dual tax agreement with your base of operations? Will you be liable for double tax?
  • You may expose yourself to local employment regulations related to the staff you engage. Each country views major employment terms differently. For example, in China, any employee who has their contract extended twice (i.e. performs 3 consecutive contracts with one organisation) is deemed a permanent employee for life. You can no longer make this employee redundant without offering them retirement.
  • Who will deal with the employee’s tax concerns? If you expose your employee to double taxation or they suffer a loss in take-home pay due to being exposed to higher tax and social dues – you will have a very unhappy staff member and a major headache!