Hiring talent beyond your borders has never been easier. Today, companies of every size—from fast-growing startups to global enterprises—lean on offshore and international teams to stay competitive. But while cross-border hiring opens doors to new skills and new markets, it also introduces one major question:
If you're expanding your workforce globally, or if you're just thinking about hiring your first team member overseas, this guide will walk you through how to pay offshore employees safely, legally, and efficiently. You'll learn the steps, risks, tools, and best practices—plus how Atlas HXM simplifies paying international hires through our Employer of Record (EOR) services.
Key Takeaways
Offshore hiring is growing fast, but compliance, payroll, and labor laws vary widely across countries—making it essential to understand how to pay international employees correctly.
There are several methods for paying international employees, including online payment platforms, setting up a local entity, partnering with local businesses, or using an EOR like Atlas HXM.
A direct EOR model offers the fastest and most reliable way to pay international teams, manage benefits, meet labor law requirements, and run fully compliant payroll.
An EOR also helps companies avoid misclassification, currency issues, and inconsistent payroll processing.
When choosing how to pay employees working across international borders, employers need to consider local labor laws, required benefits, tax obligations, currency rules, and onboarding timelines.
Atlas HXM’s direct EOR model — operating in 160+ countries — offers transparent pricing, faster onboarding, 24-hour support, and local HR/legal expertise, making global hiring seamless and compliant.
Why Offshore Hiring Is Growing Fast
Remote work didn't just change how companies operate—it changed where they hire. Access to global talent means you can work with top experts regardless of where they live, and employees can work for great companies without relocating.
However, every country has its own tax, payroll, labor, and benefits requirements. That's why understanding how to pay employees across borders correctly is a must for your business.
How does global expansion impact business operations? Learn more here!
How to Pay Offshore Employees
There are several approaches companies use to determine how to pay international teams. Below are the most common methods, along with when each makes sense.
1. Use an Online Payment Service (Good for Contractors Only)
Platforms like Wise, PayPal, and Payoneer are often used for freelancers or independent contractors—not employees.
They offer:
Fast payments
Easy international transfers
Multi-currency options
But they do not solve compliance, taxes, benefits, or labor law issues. They also might not be the best way for a U.S company to pay international employees if you need long-term hiring support.
When to use it
Short-term freelancers
One-off projects
Non-employee relationships
When NOT to use it
When hiring full-time staff
When local laws require employment status
When compliance is a concern
2. Set Up Your Own Local Legal Entity (Best for Long-Term Expansion)
If you plan to operate in a country long-term, you can set up your own local company (also called a subsidiary). This lets you run local payroll and fully manage the hiring process.
However, entity setup is:
Expensive
Time-consuming
Legally complex
High-maintenance
Most small and mid-size companies don't need this level of infrastructure.
Pros
Full control
Long-term stability
Cons
Requires local tax experts
Requires local payroll experts
High cost
Months of setup time
3. Use an Employer of Record (EOR): The Most Compliant and Cost-Effective
If you want a simple, compliant, low-risk way to hire and pay overseas talent, partnering with an EOR is the most efficient option.
An EOR like Atlas HXM:
Hires employees on your behalf
Runs payroll in local currency
Handles taxes and social contributions
Ensures labor law compliance
Manages contracts, onboarding, and benefits
Avoids the need to set up a legal entity
This is what modern global companies use when figuring out how to pay remote international employees without taking on unnecessary risk. EORs are the best way for a U.S company to pay global hires without the headache.
What You Must Know Before Paying International Staff
Before you decide on a payroll method, you need to understand a few foundational concepts. Paying international employees involves significant challenges and risks, including complying with complex and varying local labor laws, tax regulations, and data privacy rules.
Other risks include employee misclassification, currency exchange rate fluctuations and long payment processing times. These complexities can lead to financial penalties, legal issues, and damage to employee relations if not managed properly.
Key Challenges and Risks
Paying a global workforce comes with layers of responsibility, and each country adds its own rules to the mix. Here are some of the biggest payroll challenges employers face when managing international payroll:
Challenge | Description |
Regulatory Complexity | Every country has its own employment laws, tax rules, wage requirements, and reporting obligations that frequently change, requiring constant oversight. |
Worker Misclassification | Misidentifying employees as contractors can lead to severe penalties, because each country defines employment status differently. |
Tax & Social Contribution Management | Handling multiple tax brackets, social security systems, and filing deadlines across countries makes global payroll complex and error-prone. |
Currency Exchange & Fluctuations | Shifting exchange rates and conversion fees can impact employee take-home pay and increase employer costs, especially in volatile markets. |
Slow or Disrupted Payment Processing | International transfers undergo strict compliance checks and AML screens, causing delays that don’t occur with domestic payroll. |
Data Privacy & Protection Laws | Countries enforce strict rules on storing and transferring payroll data (e.g., GDPR), and violations can cause financial and reputational damage. |
Time Zones & Language Barriers | Differences in time zones can slow down payroll approvals and support, while language barriers create challenges in documentation and communication. |
Why Atlas HXM Is the #1 Choice for Paying Offshore Teams
Most EOR service providers rely on third-party partners. That means slower onboarding, weaker compliance, fragmented processes, and risk exposure.
Atlas HXM is the world's largest direct EOR, meaning we OWN and operate our entities in 160+ countries. No third parties. No delays. No gaps in compliance.
With Atlas HXM, you get:
Direct EOR coverage in 160+ countries
Upfront cost transparency (itemized pricing)
Local HR and legal experts on the ground
24-hour real-human support
Cloud-based onboarding & payroll tools
Premium local benefits around the world
Faster hiring and faster issue resolution
This makes Atlas HXM the most reliable EOR service for companies that want to expand safely and pay global employees the right way.
Discover the true cost of expanding your team across borders with Atlas HXM's Global Employee Cost Calculator.
Things to Know When Paying International Teams
Below is an actionable roadmap for paying offshore employees accurately and compliantly. Whether you're hiring one person or building a full global team, the steps are the same.
1. Confirm the Worker’s Classification
Before you can begin paying international staff, you must know whether your worker is an:
Employee
Contractor
Consultant
Each status has different legal rules—especially abroad.
Wrong classification = fines, back taxes, and penalties.
2. Understand Local Labor Laws
Each country regulates:
Payroll taxes
Mandatory benefits
Vacation time
Termination rules
Sick leave
Paid holidays
Pension contributions
This makes it important to know exactly how to pay employees working across international borders without breaking local laws. If you're not working with an EOR service provider, you may have to hire local legal experts in each country to stay compliant.
3. Choose the Right Payment Method
Your options will depend on:
Worker classification
Contract type
Local laws
Banking requirements
Currency needs
For most employers, using an EOR like Atlas HXM is the easiest way to pay international teams without delays or compliance risks.
4. Set Up Country-Compliant Payroll
Global payroll must account for:
Currency exchange
Bank fees
Country taxes
Social contributions
Wage thresholds
Local pay frequency rules
This step is extremely complex if you're not familiar with the country. That's why most companies use an EOR service like Atlas HXM so payroll runs automatically every month.
5. Provide Legally Required Benefits
Many countries require employers to offer benefits such as:
Health insurance
Pension contributions
Accident insurance
Parental leave
Paid vacation
Sick leave
EOR service providers like Atlas HXM normally negotiate these benefits for you and bundle them into your monthly cost.
6. Pay Employees in the Correct Currency
Local salary must usually be paid in:
The employee’s local currency
Using a country-approved banking method
This is another reason the best way for a U.S company to pay international employees is with a direct EOR like Atlas HXM—we handle all currency conversions and secure banking transfers.
7. Stay Updated with Changing Regulations
Labor laws shift constantly around the world. Compliance requirements update yearly—or even monthly.
As a top-tier EOR service provider, Atlas HXM stays ahead of these shifts so you don't have to monitor every new international law.
The Benefits of Paying Offshore Employees Through a Direct EOR
Here's why Atlas HXM is the safest and smartest solution for how to pay remote international employees:
Full legal compliance: Atlas HXM keeps your company protected in all 160+ countries.
Faster onboarding: New hires can start working in under two weeks—not months.
Lower cost: Atlas HXM clients save up to 82% compared to opening their own foreign entity.
No third-party risk: Our direct EOR model means YOU stay protected.
All-in-one global payroll platform: One dashboard runs payroll for your entire global workforce.
24-hour human support: Real experts—not chatbots.
Atlas HXM Transparent EOR Pricing Model
Atlas HXM is the world's largest direct EOR, offering transparent EOR pricing, global coverage, and expert-led HR, legal, and payroll support across 160+ countries. We emphasize cost clarity, compliance confidence, and operational speed for companies expanding internationally.
Pricing starts at $599 per employee per month (with volume discounts for teams of 5+).
Atlas HXM offers clear, itemized costs upfront—no hidden fees.
High customer satisfaction with top ratings on Capterra, Crozdesk, G2, Gartner, and GetApp.
Atlas HXM is an industry-recognized leader by Everest Group, NelsonHall, and other analysts.
Here's how Atlas HXM outperforms major competitors:
Provider | Starting Cost | Countries | EOR Model |
Atlas HXM | $599 | 160+ | Direct |
Deel | $599 | 150+ | Indirect/Hybrid |
Remote | $599 | 100+ | Direct |
Multiplier | $400 | 150+ | Indirect/Hybrid |
Rippling | Quote | 80+ | Indirect/Hybrid |
Is an EOR Right for Your Company?
If you're wondering if an EOR service provider is right for your team, here's a quick framework.
Choose an EOR like Atlas HXM if you:
Want to hire in a country where you don’t have an entity
Need to pay global employees quickly
Want simple, predictable pricing
Need global compliance handled for you
Want one platform for payroll, benefits, and HR
Want to hire offshore staff without legal risk
Setting up your own entity only makes sense if you:
Have long-term, large teams in that country
Want full control over local operations
For most U.S. companies, especially growing ones, using Atlas HXM is the most efficient way to hire and pay teams globally.
Simplify Paying Offshore Employees with Atlas HXM
When you know how to pay global employees properly, expanding your team internationally becomes a major competitive advantage. You gain:
Access to global talent
Faster scaling
Lower costs
More flexibility
However, ignoring compliance, tax requirements, or labor laws can put your business at risk. That's why working with an EOR service provider like Atlas HXM is the safest, simplest, and most cost-effective way to expand your workforce responsibly.
With Atlas HXM's direct EOR network, local expertise, and easy payroll platform, you can hire anyone, anywhere—and pay them compliantly—without slowing down your business.
Contact Atlas HXM to get started today!