Global Compliance and the Evolution of the Contingent Workforce

On September 23, 2015 at 2PM EDT, CXC Global hosted a complimentary webinar with Ardent Partners on “Global Compliance and the Evolution of the Contingent Workforce” to discuss the complexities and challenges of implementing a global compliant contingent workforce program.

CXC Global America’s MD John Smith, one of the key presenters for the webinar along with Ardent’s Christopher Dwyer provided answers to some of the questions asked by attendees.  We are delighted to share these below.

Q-1 – Directed to Chris.  Talk a little bit more about the idea of total talent management

A-1 – Chris  ‘Total talent management is being able to manage all your talent based resources under a centralized and standardized program of processes, capabilities and integrated solutions.’

Q-2 – Directed to John.  How are contractors paid around the world? Do they have to be paid in their local currency?

A-2 – John  ‘Every country has laws about how contractors are paid around the world and whether they have to be paid in their local currency or can be paid in one of the major currencies throughout the world.  CXC Global has noticed over the years that we are seeing more and more contractors trying to submit invoices to us when their currency is strong against the dollar or the pound or the Hong Kong dollar.  We have seen contractors sitting on invoices until their currency gets stronger, at which point they then try to submit a bunch of invoices for payment. As a company we don’t encourage this as a strategy and try to keep away from it.  What we do encourage and recommend is that there is a way for companies like CXC Global to help manage the currencies for you.  There is a cost associated to provide this service, but we have very good capabilities to assist our clients to have a bill that comes to them in their local currency and CXC can manage the invoice and payment locally in the U.S.’

Q-3 – Directed to John.  Are employment structures the same for all contractors around the world?

A-3 – John  ‘We talked about this very topic earlier and the answer is no.  Just because someone is employed as a contractor, it doesn’t mean they’re employed in the same way as a contractor here in the U.S. or anywhere throughout the world.  The term independent contractor is used so differently around the world.  You may be a Limited Company contractor (Ltd Co), self-employed, freelancer, Corp to Corp contractor etc.  There is no standard terminology that is used.  Employment structures are all based on the local standards and CXC Global does our best to stay in compliance with those.’

Other questions submitted by attendees

Q-4 – We are currently paying contractors via an online payment service, what risk do we face?

A-4 – John  ‘If you’re refereeing to a service like PayPal, the contractor or service you are paying is probably receiving a 100% gross payment. It’s also possible the contractor is not are not paying proper taxes.  If the contractor is ever audited due to regular or excessive PayPal payments the source of the payment can come back to your company and can open you up to audit by state, provincial or federal tax agencies.  Also your company’s communication / PR department probably will not like the possible negative press you can receive if you problems go public.’

 Q-5 – Chris and John spoke at length about the importance of compliance. How can I move this up the ladder, since our company typically pushes costs as its main metric?

A-5 – John ‘Many companies focus on cost of the primary driver when making decisions.  It’s important that any organization looks at all factors that lead to compliant contractor engagements around the world.  Both human resources and procurement play an important role in this process and should collaborate with your chosen partner to ensure that both the talent management and compliance components are both achieved.’

Q-6 – If we’re just embarking on expanding our program into new global regions, what are the first few steps we should take?

A-6 – John  ‘Speaking with a company like CXC Global, they can advise you of the questions that should be asked first when entering a new country and identifying talent.   Most important is to understand if only local nationals can be employed or if there is an opportunity for expats on work visas.   Second it’s best to always negotiate with the contractor based on the local currency not the currency in which the company’s headquarters is located.  Additionally, it’s important to know whether employed or self-employed solutions are available compliantly within the country.  CXC Global can advise you on this.’

 Q-7 – (Question for both Chris and John) Who should be leading the charge from a responsibility standpoint in regards to global compliance, procurement, HR or some other department?

A-7 – John  ‘This is an interesting question as the need to engage a contractor generally begins with a manager who will then move up the chain to human resources for talent acquisition. Given the role that procurement is playing in today’s contingent workforce programs is important that all three departments of your company work closely to ensure adherence to internal policies while focusing on the importance of bringing the right contractor in to perform a task. CXC Global has extensive history working in communicating with all three of these departments and understanding the role that each plays.’

The webinar is now available on-demand for replay or for anyone that wasn’t able to attend the live event.

To view, click the following link 

For any other questions you have on Global Contractor Compliance please contact:

John Smith
Managing Director
CXC Global Americas
+1 203 459-0683