If you are looking to expand your business into Latin America, one of the first choices to consider is whether to establish a local entity or get staff through a professional employer organization (PEO). Hiring through a PEO in Latin America is a popular choice because it means you can have overseas staff in little more than the time it takes to find them, while you also enjoy the advantage of having all compliance matters related to those employees taken care of by your provider.
When you choose to hire via a PEO in Latin America, those team members report directly to you while being employed by the PEO firm‘s locally established entity. If you don’t already have the staff you want to hire lined up, your PEO provider will also be able to assist with the recruitment and hiring process, as well as onboarding those staff, whose payroll will be managed by the provider.
When it comes to the hiring process, a provider of PEO in Latin America will have an established recruitment network and track record of finding talent, as well as knowledge of the local employment market, meaning that they will be aware of the best local educational programs and employers relevant to the role you are seeking to fill.
SEE ALSO: 4 back office services in Ecuador to consider outsourcing
Hiring via a PEO in Latin America also means tapping into valuable legal expertise, with PEO providers having experts in commercial, employment, and labor law on hand to make sure that every aspect of the process of hiring and managing employees is in full compliance with local regulations.
It is worth noting that companies offering PEO services are also commoly referred to as an employer of record (EOR) and will often advertise themselves as a PEO payroll company, given that payroll management is one of the most in-demand services they offer.
PEO in Latin America: choose where to launch
If you don’t have one particular market in mind, or would like to hire staff in multiple countries, you will likely want to seek PEO services from an employer of record with a presence in multiple markets in Latin America.
Because such a provider will be able to provide you with valuable advice regarding which market would best suit your needs based on the profiles of employees you are seeking and most up-to-date market conditions, as well as cover all of your PEO needs across multiple markets under one services agreement.
That will not only be significantly easier to manage, but will also mean you have the option of expanding or modifying the agreement to enter new markets as your operations grow or your priorities shift.
SEE ALSO: Why so many investors are interested in PEO in Guatemala
When considering which markets to move into, keep in mind that PEO is not available in every jurisdiction in Latin America, with Ecuador notably not allowing this type of outsourcing. Mexico and Peru, meanwhile, have introduced laws over the past 18 months that mean a number of additional administrative requirements must be met in order to access such services — however, your provider will be able to take care of most of those, and they remain good outsourcing options.
One way to get a better impression of where to outsource and seek the services of a PEO firm in Latin America is by using a payroll calculator.
The Biz Latin Hub payroll calculator offers information on hiring costs related to all of the 16 markets in Latin America and the Caribbean where the company has offices, offering calculations based on the following variables:
- Location where staff are being hired
- Expected salary for each employee
- Prefered currency (with USD and local currencies available for each jurisdiction).
Be aware that the calculator is only intended to provide a general idea of the costs associated with hiring in different markets. To get a fuller picture, based on your precise needs, you will need to seek consultation from your chosen provider.
Advantages of hiring via a PEO firm?
Hiring via a PEO firm in Latin America comes with the following benefits:
Limited commitment: When you hire staff through a PEO in Latin America, you limit your commitment to the market, allowing you the opportunity to get to know it better ahead of making a deeper investment, as well as to swiftly exit the market whenever needed.
Time-saving: Being able to secure local staff in just weeks or days, depending on their profiles, getting staff via a professional employer organization in Latin America can be a rapid and convenient process.
Established network: While the established recruitment network of your employer of record in Latin America will help you to find staff quickly, you will also be able to tap into the local business connections your provider has, which could be highly beneficial to your organization later down the road.
Building familiarity: By hiring via a PEO firm in Latin America, you have the opportunity to get to know the local market better, building familiarity with the regulatory regime, and understanding some of the foibles of doing business in the market, which will be useful should you decide to take your investment to the next level via company formation.
Reduced costs: The PEO fees you will incur are often considerably less than the costs associated with company formation, especially if you are launching in multiple markets.
Legal representation: Your employer of record in Latin America will have experts on hand to offer the advice and support you need, as well as represent your organization in front of authorities.
Biz Latin Hub can be your employer of record in Latin America
At Biz Latin Hub, we provide integrated market entry and back office services throughout Latin America and the Caribbean, with offices in more than a dozen markets throughout the region and trusted partners in others.
When you chose us as your PEO firm in Latin America, you tap into our unrivaled regional presence, making us an ideal choice for multi-jurisdiction market entries. If you are in need of an employer of record in Latin America and have an eye on evolving your business later down the line, we are ready to assist you.
As well as providing hiring and PEO in Latin America, our portfolio includes company formation, accounting & taxation, and legal services, among others. So we are equipped to support you through every step of the expansion of your business.
Contact us today to find out more about how we can assist you.
If you found this article on finding a PEO payroll company in Latin America of interest, check out the rest of our coverage from across the region. Or read about our team and expert authors.