Mastering Global Compliance for Tech Companies: A Guide for Hiring Beyond Borders

As technology companies continue to burst onto the scene, global hiring has become a strategic imperative to remain competitive. Global hiring can help tech companies overcome local talent shortages, fill critical roles, and test new markets, but it also brings a host of challenges, particularly around compliance. 

Compliance is key for companies building global workforces — and although there are core elements of compliance that apply to all industries, the tech sector has unique requirements, including technology transfer regulations, cybersecurity and data protection laws, and software certification and licensing rules like the EU’s Digital Single Market Initiative. 

With thousands of professionals on-platform, G-P has enabled companies to hire for nearly every role imaginable. Top roles include engineering and sales, but we’ve helped tech companies of all sizes hire senior software engineers, chief information officers, data scientists, and more.

Leveraging our 12+ years of industry experience, we’ve gathered essential compliance insights all tech companies should know. Let’s start with the basics and then explore the critical compliance tasks for your leadership team.

Why compliance matters for tech companies

Global compliance refers to adhering to the various laws and regulations that govern employment, taxation, data protection, and other operational aspects in different countries. For tech companies, noncompliance can lead to severe consequences, including legal issues, financial penalties, and reputational damage. When hiring globally, tech companies should consider a variety of compliance factors:

• Labor laws and regulations: Each country has its own set of labor laws governing employment contracts, working hours, minimum wages, and termination procedures.
• Immigration laws and work permits: Hiring global employees often requires navigating complex immigration laws and securing appropriate work permits and visas.
• Taxation and payroll regulations: Companies must comply with local tax laws, including income tax, social security contributions, and other payroll-related obligations and reporting, such as those mandated by the European Pay Transparency Directive.
• Data protection and privacy laws: Ensuring compliance with data protection regulations, such as the GDPR in Europe or CCPA in California, is critical to avoid fines and protect employee data.

Global expansion roadmap for tech companies

Tech companies need to not only meet basic employment regulations in the jurisdictions in which they operate, but also the unique needs of the industry and employee base. Tech company leaders are encouraged to seek the assistance of companies such as G-P, who have a large team of industry experts in employment law and compliance, as well as partner with some of the best law firms to support customers.

Once your team is ready to start expansion planning, here are a few additional compliance elements to include in your initial roadmap:

• Local tech regulations and standards: Tech companies must adhere to regional technology regulations and standards, including software certifications and industry-specific rules. For example, the European Union’s Digital Single Market Initiative outlines specific standards for digital services, impacting tech companies operating in the region.
• Intellectual property rights: Protecting IP across different jurisdictions is essential to safeguard innovations and prevent infringement. 
• Cybersecurity and data protection: Global operations mandate robust cybersecurity measures to protect sensitive and proprietary data. The increasing incidence of cyberattacks underscores the importance of compliance with local and international cybersecurity standards. According to estimates from Statista’s Market Insights, the global cost of cybercrime is expected to surge from USD 9.22 trillion in 2024 to USD 13.82 trillion by 2028. 
• Export controls and technology transfer regulations: Understanding and complying with export control regulations is vital when transferring technology across borders. For instance, U.S.-based tech companies must navigate the Export Administration Regulations (EAR) when exporting certain technologies.

What do HR, Finance, and Legal leaders at tech companies need to know?

From labor laws and employment contracts to budgeting for compliance costs, and managing intellectual property risks, leadership teams have a complex slate of mandates they need to stay on top of when entering new markets. 

Let’s take a closer look at what HR, Finance, and Legal leaders need to address when taking on global expansion, including tech-specific considerations for each of these areas:

Compliance task snapshot: HR

For HR leaders at tech companies, attracting and retaining top talent in a competitive global market is the top priority. HR teams must implement hiring practices that not only comply with local labor laws but also appeal to highly sought-after tech professionals. This includes offering compelling benefits and compensation to attract talent from diverse regions. 

Tech companies often lead the way in remote work and flexible arrangements, and that requires HR leaders to have a deep understanding of international labor laws to manage dispersed teams effectively. They need to understand cross-border team dynamics and cultural differences so that communication is easy and seamless.

Other critical compliance tasks for HR teams include:

• Revising local labor laws and employment contracts: Ensure all employment contracts comply with local laws and regulations.
• Conducting fair hiring practices and respecting anti-discrimination policies: Implement hiring practices that adhere to local anti-discrimination laws.
• Customizing employee benefits and compensation: Align employee benefits and compensation with local standards and regulations. Including benefits in kind, or supplemental benefits, can improve employee engagement and talent retention.

Compliance task snapshot: Finance

Finance leaders at tech companies face the complex task of managing global payroll and tax compliance. The financial implications of various software licensing and subscription models require careful planning and management.

Finance leaders must also budget for compliance-related expenses, which can vary significantly from one country to another. They should explore opportunities for investment in R&D and take advantage of incentives offered by different countries. Managing currency exchange risks and adhering to local financial reporting requirements further complicate the financial landscape for tech companies pursuing global expansion.

Other essential compliance checkpoints for Finance teams include:

• Navigating international payroll and tax: Study and learn the nuances of international payroll, tax reporting obligations, and social security contributions.
• Budgeting for compliance costs: Plan for potential compliance-related expenses.
• Managing currency exchange and financial reporting: Manage currency exchange risks and comply with local financial reporting requirements.

Compliance task snapshot: Legal

Legal leaders at tech companies must stay continuously updated on the evolving laws and regulations in every country of operation. Ensuring that contracts are legally sound and protect the company’s interests is crucial.

Legal teams must also focus on protecting intellectual property rights across various regions, as IP is often the backbone of tech companies. Compliance with pay transparency and global data privacy laws, such as GDPR and the California Consumer Privacy Act (CCPA), is critical to avoid fines and reputational damage. Managing the complexities of technology transfer and export controls is another vital consideration for Legal teams at tech companies.

Other important compliance tasks for Legal teams include:

• Staying updated on employment laws and regulations: Continuously monitor and adapt to changes in local employment laws and regulations regarding worker entitlements.
• Ensuring legal soundness of contracts: Draft contracts that are legally compliant and protect company interests. Ensure that terms related to IP, liability, and termination are clearly outlined.
• Managing IP and data security risks: Ensure robust protocols in each country to safeguard innovations, proprietary technologies, and competitive advantage.

The role of an Employer of Record (EOR) in tech company success

An Employer of Record (EOR) can be a valuable partner for tech companies looking to hire in new countries and enter new markets compliantly. An EOR serves as the legal employer for your global workforce, handling all employment-related matters, including payroll, taxes, benefits, and legal requirements. 

With simplified compliance management, and a reduced administrative burden, EORs can help tech companies facilitate quick market entry while also providing the flexibility to exit without the complexities of shutting down an entire legal entity. 

For tech companies specifically, the benefits of partnering with an EOR include:

EOR in action: G-P helps OneStream Software grow farther, faster.

Headquartered in Rochester, NY, OneStream’s mission is to empower companies with smart finance solutions that streamline and improve operations. The company’s leadership team was concerned about the potential administrative burden associated with expanding globally and its possible toll on their HR and Legal teams.

OneStream’s VP of Global Culture Martha Angle was impressed with G-P’s ease-of-use and secure insights.

Today, G-P provides OneStream with customized EOR services, self-serve technology, and access to the largest team of in-region HR and legal specialists in the industry. The company has more than 25 global employees, spanning across 10 countries and two continents, through G-P.

Global business success made possible with G-P

Maintain your competitive advantage and hire the right talent for critical tech projects in minutes with G-P Meridian Suite™, our fully customizable suite of global employment products and EOR solutions. We streamline and simplify the entire employment lifecycle — from hiring to onboarding, payroll, and end-to-end HR support — making global team management easy with G-P. 

For more information on hiring and building global teams quickly and compliantly, contact us today.