Independent contractors or freelancers are self-employed individuals who provide services to companies as a non-employee. This is one of the most common ways companies tend to hire non-local designers, engineers, support reps, etc.
For legal and tax purposes, independent contractors are not classified as employees. They may work for multiple clients, set their own work hours, negotiate their pay rate, and decide how a job gets done.
For example, the IRS says that if an independent contractor or freelancer does work that can be controlled (what will be done and how it will be done) by an employer then they are, in fact, classified as an employee.
As you can imagine, hiring someone as an independent contractor versus an employee is a fine line to tread.
While there are benefits when you choose the contractor route, there are quite a few drawbacks to consider and you’ll need to weigh them carefully to determine the best fit for your company.
A foreign subsidiary is a company that operates overseas as part of a larger company who’s HQ is in another country.
Establishing a foreign entity is great for having an international presence and accessing new markets. Though, setting up a subsidiary in Argentina can be expensive, stressful, and time-consuming. It's not for the faint of heart.
To set up a subsidiary in Argentina, you have to:
If you're lucky, this process can take months. If you're not so lucky, it can take up to a year. And on average, it costs about $50k-$80k, all-in-all, to get setup. And that's just for Argentina.
An employer-of-record (EOR) is a company that hires and pays an employee on behalf of another company.
An EOR is typically used to overcome the financial and regulatory hurdles that often come with employing remote workers.
Each country has its own payroll, employment, and work permit requirements for non-resident companies doing business in their jurisdiction. Meeting those demands can be a huge obstacle when it comes to hiring remotely.
At Panther, we help companies employ and pay people in over 160 countries, without having to set up a foreign subsidiary. Payroll, benefits, taxes, compliance, and more are all handled by us, at a fraction of the cost.
Outside of saving you months and tens of thousands of dollars, other advantages of using Panther are:
Because you no longer have to set up your own subsidiary, you’ll save a ton of time and tens of thousands of dollars using Panther.
Paying employees in Argentina is not the same as paying workers in your own country. Employees have to be paid using Argentina’s employment and payroll standards.
This means that you have to know, understand, and keep up with 1) fluctuating currency changes, and 2) local payroll and tax laws in the countries you’re looking to hire in.
Outside of the laws and regulations around payroll, there may be different conditions surrounding leave, overtime, termination, and more. As you can imagine, maintaining this kind of regulatory knowledge can be challenging. But it is crucial and necessary to follow local legislation.
After, you’ll have to determine the best way to pay your international employees. This can be done in a number of ways, including but not limited to:
One of the most challenging (and expensive) parts of paying international employees is setting up the infrastructure to do so.
Before you start to run payroll, you have to register your company as the local employer in the country the worker resides in. As you can see in the “Set up a subsidiary” section, this is a multi-step process that can take up to a year and put you on your way to bankruptcy.
Outside of EORs acting as the full admin employer, many also provide remote payroll.
For example, at Panther, in just 1-click, you’re able to pay your entire global team, anywhere in the world. We send you an invoice each month, charge you in US Dollars, and pay your employees the same amount in their local currency.
We factor in currency fluctuations and use the mid-market rate plus any applicable fee passed on by our provider at cost at the time of billing.
Full-time employment is 8 daily hours and 48 weekly hours, maximum.
While working overtime isn’t common in Argentina, overtime hours should not exceed 3 hours per day, 30 hours per month, or 200 hours per year.
Employees receive an additional 50% for overtime work and double time for holidays or work performed after 1pm on Saturdays.
As per Sections 126 and 128 of the Argentina Employment Contract Law. Payments are made as follows:
Employees who work on a monthly basis are paid monthly and must be made within 4 days of the following month. For hourly employees, wages are paid either weekly or every 2 weeks.
In Argentina, 13th month pay is calculated based on 50% of the year's highest monthly salary. It is paid out in two installments, one before June 30th, and the other before December 18th.
PTO is calculated by the length of employment:
There are Holidays that fall at the end of the week are moved to the following Monday.
Employees with less than 5 years of employment are entitled to 3 months of paid sick leave. Those with over 5 years of employment receive 6 months of paid sick leave. Leave is doubled for those with dependents.
Maternity leave is a total of 90 days and is typically split between 45 days before birth and 45 days post-birth, but not required.
At least 30 days must be taken before birth. Maternity leave pay is based on the average earnings of the 6 months leading up to birth.
Fathers receive 2 days of paid paternity leave.
There are no provisions in the law regarding parental leave.
Examination for university or secondary school: 2 days at a time (with a cap of 10 total).
Marriage: 10 days’ leave
Death of a child, parent or spouse: 3 days’ leave
Death of a sibling: 1 day’s leave
Termination must be justified with notice, unless it’s through mutual agreement due to economic factors, the employee has not been fulfilling work, or has performed serious misconduct.
The notice period in Argentina is:
Employees receive one month’s pay for each year of employment. Employees terminated for economic reasons are entitled to half a month’s salary for each year of service.
Probation period is 3 months.