Navigating HR Considerations for Global Expansion in 2024

As we step into 2024, human resources (HR) leaders are increasingly pivotal in navigating the complexities of global workforce management. Whether you’re looking to take your first steps towards international expansion or aiming to solidify your global presence, understanding the critical HR elements is essential for your success.

Global Expansion Considerations

In 2024, HR will be instrumental in guiding organizations through the complexities of global expansion. As businesses venture overseas, one primary consideration is the choice of employment model—whether to use an Employer of Record (EOR), a Professional Employer Organization (PEO), or set up a legal entity. Each model offers distinct advantages and challenges, which vary by country and jurisdiction. For example, EORs act as the legal employer, handling all employment responsibilities in foreign jurisdictions, which is beneficial for companies without a local entity. In contrast, PEOs, prevalent in the U.S., share employer responsibilities and are suitable for companies with an established domestic legal entity. Understanding these differences and choosing the right model is crucial, as it will affect your organization’s compliance and operational efficiency in the countries and jurisdictions in which you operate.

The Biggest HR Challenges in 2024

HR professionals are set to face numerous challenges in 2024, primarily influenced by the pandemic and other global events. The aftermath of COVID-19 and geopolitical issues like the Ukraine conflict and the cost of living crisis continue to reshape the workforce landscape, impacting global expansion and remote work policies. HR leaders will need to navigate these complexities by maintaining a seat at the executive table to ensure organizational resilience and competitiveness. Key challenges will include managing diverse employee needs with company goals (especially for expats and remote workers), and handling high-stakes negotiations with unions and work councils. Effective talent acquisition and retention strategies will be paramount in supporting your organization’s business and global expansion goals.

The Effect of Digital Nomads on HR

The rise of digital nomads, accelerated by the pandemic, presents unique challenges and responsibilities for HR. Companies must adapt to manage remote employees who may live and work in different jurisdictions. This shift requires HR to accurately track employee locations to ensure compliance with local tax laws and employment regulations. For instance, different countries may have specific requirements for home-working allowances or work permits for foreigners, which can significantly affect an organization’s tax and legal obligations. HR must develop robust policies and systems to manage these aspects effectively, ensuring that all employee data is current and compliant with international standards.

Role of HR in Data Protection and Privacy Laws

With stringent data protection and privacy laws like the GDPR in the EU, HR’s role in ensuring compliance has become more critical than ever. The GDPR, which is the world’s strictest data privacy and protection law, requires organizations to handle personal data with high levels of security and transparency. HR professionals must be deeply familiar with these laws, as non-compliance can result in hefty fines and other penalties for companies of all sizes. HR teams must also manage the flow of employee data across borders, particularly around digital nomads and remote workers. By establishing systems like Human Resources Information Systems (HRIS), HR can better manage and protect employee data, ensuring that personal information is securely handled across all jurisdictions to mitigate any compliance risk.

The Key to HR Success in 2024? Applying the Right Information to Increasingly Complex Global Challenges.

In 2024, HR leaders need to be prepared to tackle all types of legal and administrative challenges associated with unforeseen global growth, regulations, and employee mobility. To succeed, HR professionals will need to be creative and proactive in developing policies to manage growth, retain top talent, stay in compliance in every country in which they have a footprint, from digital nomad workers to a legal entity. 

On top of it all, HR professionals will continue acting as trusted internal experts to organizational leaders and key stakeholders. But even HR experts can’t do it all, so leveraging outside expertise will be key for staying on top of the evolving complexities of global expansion. Authored by our Director of HR Consulting, Kathryn Hendy-Ford, our latest eBook, HR Considerations For Your Global Workforce, is designed to equip HR and People leaders with essential insights for managing a global workforce, covering everything from hiring models to compliance in remote work.

HSP is an end-to-end global expansion solutions provider focused on helping companies scale their operations overseas effectively and efficiently. We are the only global expansion expert to offer growing companies a full suite of end-to-end solutions designed to help them scale to any size, in any country. 

Our in-country experts have delivered the full spectrum of global expansion solutions—from EoR to entity set-up and management—across more than 100 countries (and counting). HSP brings full payroll, accounting, tax, legal, compliance and HR services to corporate teams, integrating with inhouse staff to both guide and execute across every domain. Contact us today so that we can start delivering your custom solutions.