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.
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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 Sierra Leone can be expensive, stressful, and time-consuming. It's not for the faint of heart.
To set up a subsidiary in Sierra Leone, 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 Sierra Leone.
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 Sierra Leone is not the same as paying workers in your own country. Employees have to be paid using Sierra Leone'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.
The standard workweek in Sierra Leone 40 hours.
Overtime in Sierra Leone is paid at and additional 50%; work on rest days is paid at an additional 100%.
Employer
The typical payroll cycle in Sierra Leone are typically paid on a monthly basis.
In Sierra leone, bonuses are not required.
Employees are entitled to 19 days paid annual leave, which increases to 22 days after five years of service and then 28 days after 10 years. Vacation Time in Sierra Leone:
There are 10 public holidays.
Entitlement to sick leave is generally governed by collective agreement or the employment contract.
Employees generally receive at least five paid sick leave days annually.
Female employees are entitled to 12 weeks of paid maternity leave.
The employer pays the leave unless otherwise agreed in a collective agreement.
There is no paternity leave in Sierra Leone.
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An employment contract in Sierra Leone can be terminated at the end of the contract period (if for a fixed term) by the employer or the employee. Fixed-term employment contracts terminate at the end of the term.
An employer and employee can terminate an employment contract without providing notice during the probation period unless there is an individual or collective agreement that requires notice.
Notice of termination periods range in between one week to one month. However the employee’s services must be terminated for just cause.
Severance payments are not mandated by law in Sierra Leone. However, if an employee is terminated on the grounds of redundancy, they will be entitled to prior notice and compensation in accordance with their length of service with the employer.
The probation period iin Sierra Leone cannot exceed s six months.
