A Global Employer Organization (GEO) becomes the employer of a Company’s employees in a country where the Company (client) does not have their own entity, much like a PEO.
A GEO will provide;
- Work Permits - they sponsor the client’s employees on local employment work permits if required.
- Employment - they will employ the client's employees on compliant local employment contracts and ensure all local employment regulations are adhered to. The GEO acts as the "employer of record" for the staff.
- Pay-roll - they will administer the in-country pay-roll, paying the net salaries locally or internationally as required by local legislation, deducting tax and social security at source and pay this to the local authorities as per local requirements.
- Reporting - Provide the employee with a local monthly payslip and providing monthly, quarterly and annual pay-rolling reporting to the client and lodging compulsory local pay-roll reporting documentation to the local authorities.
Note that the client still directs the normal day to day activities of their staff. This doesn’t change. It remains exactly as it would be in a normal employer/employee relationship.
Whats the difference between a PEO and a GEO?
The difference is that a GEO is for cross border assignments only and the employees become employees of the GEO in the country in question.
How a GEO works
In essence a GEO is a packaged solution for ensuring compliance with tax, employment and immigration law. GEO’s are especially popular with small to medium enterprises and companies working internationally that don’t want to set up their own entities in new countries.
- A strategic solution to easily deploy employees internationally without having to establish a local corporate entity
- An ability to extend into new markets in a consistent, cost-effective manner, clearly defining budgets in advance of deployment
- Cost reduction compared to establishing a corporate entity
- Allows for more rapid and flexible global expansion
- Provides an opportunity to ‘dip your toe in the water’ of a new market without having to commit unnecessarily
TIME + COST + ADMIN BURDEN
When using a GEO we find that;
- Deployment times go down from 9 months to a matter of weeks.
- Costs from 6 figures to 5 figures
- Administration from a heavy burden to next to nothing.
Over at least the short term the GEO solution is faster, more cost efficient and infinitely easier from an admin perspective than setting up your own entity.