Hiring foreign workers can improve company diversity and expand your global reach. Learn how to hire a foreign national.
A company's biggest asset is its employees, and the people you hire can have a major impact on your organization. When many businesses recently added "remote workplace" to their list of employee benefits, they realized the advantage of expanding their pools for top talent. Hiring workers from all around the world is a great way for small businesses to find highly skilled employees and expand into a global market. If you've found yourself wanting to grow your business with foreign employees, you will need to follow some specific processes before your recruiting strategy can hop the pond.
Who is considered a foreign national?
A foreign national is an individual who is not a citizen (which refers to their legal status) or national (which refers to their place of birth) of a specific country. In terms of employment in the United States, a foreign national (also known as a foreign employee or foreign worker) is an employee or independent contractor who works in the United States but is not a naturalized U.S. citizen.
Pros of hiring foreign national employees
Hiring a foreign national employee can greatly benefit your business as well as the life of the employee. Every business should strive for a diverse workplace, and hiring a foreign employee is one way to get there.
Low cost of hiring
Hiring foreign workers could save you money, depending on the role you are hiring for and the pay range for the position. The U.S. has a desirable job market for many foreigners, giving employers the flexibility to pay lower wages.
"The demand, with the high supply of workers, allows the employer to hire employees that are willing to work for lower costs," Marianne Curtis, employment litigation attorney and partner at Berger Singerman, told business.com. "In some cases, this may be the foreign worker who is looking for an opportunity to break into the United States' employment market."
Although a lower cost of hiring is a potential benefit, keep in mind that you cannot simply hire a foreign worker just because you want cheap labor. To get the work certificate necessary to hire a foreign worker, you must demonstrate a lack of other options.
"The certification requires the employer to confirm that there are insufficient U.S. workers to perform the work at wages that meet or exceed the prevailing wage for the area of employment," Curtis said.
Because of their culture, work experience, and personal life experience, foreign national employees bring unique skill sets and perspectives to the U.S. workplace. You might want or need this variety to add to the diversity of your company culture.
Expansion opportunities and connections
Hiring a worker from another country can be especially beneficial if you intend to expand your market reach to their region. The employee can give you firsthand knowledge of what their country is like and what market gaps currently exist. They may even have business connections that prove useful in your expansion.
Intrinsic value to employers
Curtis said hiring a foreign worker can also be beneficial for a small business owner because they're giving a valuable opportunity to someone seeking employment in the U.S. This can be a rewarding and personally enriching experience for employers.
Cons of hiring foreign national employees
Although hiring foreign workers can benefit you and your company, there are a few potential drawbacks. You can mitigate most of these with the proper preparation.
If you and your foreign employees do not speak the same language, you will need to have a detailed plan to help them do their jobs and take extra measures to overcome the language barrier. For example, you might want to hire bilingual mentors for them.
Pushback from local communities
Some communities might push back on businesses hiring foreign workers because they want to retain local jobs for local talent. This is something to keep in mind, especially if you operate in a small community with limited job opportunities.
Curtis said some foreign workers see their employment in the U.S. as an individual steppingstone, which can cause a lack of interest in and dedication to the company's future and growth.
Time and money
The process of recruiting and hiring a foreign national often requires more time and money upfront than hiring a domestic employee. Applying and waiting for certifications and visas can delay the process even further.
"The process can be cumbersome, so patience, commitment to the ultimate outcome, and managing expectations are critical," Curtis said.
How to hire foreign workers
If you are considering hiring a foreign worker, follow these four steps:
1. Acquire certifications.
Apply for certification from the U.S. Department of Labor (DOL). To complete this application, you have to provide proof that you need a foreign worker, that you can pay them appropriately, and that you meet the criteria for the applicable foreign labor certification program.
2. Recruit and interview candidates.
The hiring process for foreign workers will look a little different from the typical hiring process you use for U.S. citizens. Keep this in mind as you post on job boards, review resumes, and conduct job candidate interviews. The overall process can also take much longer. The candidate will need to be approved for their visa before you can officially hire them, and this paperwork could take a while.
3. Acquire work visas.
Your foreign national employee will need a work visa from U.S. Citizenship and Immigration Services before they can legally work in the United States. If they already have one, you can verify their work authorization with Form I-9. If they don't, you may have to sponsor their work visa, which will take a lot more time and effort on your part.
4. Comply with tax laws.
Address all tax laws that apply to your company and the foreign worker. For example, foreign workers in the U.S. will need a Social Security number and be subject to payroll taxes.
FAQs about hiring foreign national workers
What certification do foreign workers need?
Foreign nationals must acquire specific certifications before they can work in the U.S. These foreign labor programs are meant to ensure that the presence of the foreign worker will not adversely affect job opportunities or wages for U.S. workers.
Your foreign national worker will need to acquire one of the following certifications from the DOL, depending on the occupational requirements of the job:
- Permanent Labor Certification
- H-1B Specialty (Professional) Workers
- H-2A Temporary Labor Certification (Seasonal Agricultural)
- H-2B Temporary Labor Certification (Nonagricultural)
- D-1 Crewmembers Certification
- CW-1 Nonimmigrant Visa Program
How much is it to sponsor a foreign worker?
The filing fees to sponsor an H-1B employee typically range from $1,200 to $4,500. You will also be responsible for additional attorney fees, which can be another couple thousand dollars.
How many foreign workers can a company hire?
There is no set maximum for how many foreign workers an organization can hire; however, that doesn't mean you won't face any limitations. Business owners seeking to hire foreign nationals will need to pay close attention to current immigration processes.
"For example, with the Trump administration, there were restrictions on work visas for the stated purpose to improve job prospects for Americans," Curtis said. "Ultimately, the restrictions on foreign workers will depend on the current immigration process and economic effects on the individual company to navigate the process."
How are foreign employees paid?
If your foreign employee is working for you in the United States, you can pay them just the same as you would a U.S. citizen. However, if your foreign employee is doing the job from abroad, you need to pay them according to the payroll and employment guidelines in their country. Pay attention to factors like tax rates, payroll deductions, deadlines, employee benefits and time-off regulations. Also make sure you are properly classifying them as employees vs. contractors. If you're paying workers overseas, you can either set up and incorporate a legal entity or use a global employment organization (GEO) service.
What kind of job qualifies for foreign labor certification?
Numerous temporary and permanent jobs qualify for foreign labor certification by the DOL. These can include jobs such as specialty professional specialty work (e.g., architects, engineers, therapists and healthcare workers), temporary or seasonal agricultural labor (e.g., farm workers), and temporary or seasonal nonagricultural labor (e.g., housekeepers and cooks).
Can you hire someone without a work visa?
Sort of. Yes, you can technically hire a foreign national who doesn't have a work visa. However, they can't start working for you until they have one. If the foreign worker does not have a work visa at the time of hire, you will have to sponsor them or help them get a work visa before their official start date.