Directly hiring full-time overseas engineers as independent 1099 contractors without localized legal infrastructure exposes US companies to catastrophic misclassification liabilities.
1. Worker Misclassification vs. EOR Protection
- Misclassification Penalties: Foreign labor courts can enforce retroactive back-taxes, statutory healthcare contributions, 13th-month salary bonuses, and severance penalties.
- Automated EOR Shield: An Employer of Record acts as the legal employer of record in 150+ countries, managing statutory payroll, local labor filings, and health insurance.
- IP Assignment Guarantee: EOR agreements guarantee unconditional cross-border intellectual property assignment to your corporate entity.