Are you looking to engage and pay offshore IT developers in Saudi Arabia?
Find out how you can decide whether you should engage and pay employees or independent contractors using our free ‘Employee vs. Independent Contractor’ Checklist.
Designed to be used by companies engaging remote workforce in Saudi Arabia, the Checklist is the best way to define why and in what cases companies should onboard new hires or convert existing contractors/freelancers into employees without missing any crucial aspects.
Five Compelling Reasons to Transition Freelancers into Full-Time Employees in Saudi Arabia
The tech industry is undergoing a significant shift, as companies globally are keen to secure top talent while mitigating the risks associated with independent contractor misclassification. This is particularly relevant in Saudi Arabia. However, many organizations hesitate to transition freelancers and independent contractors to full-time roles. This hesitation could lead to missed opportunities and legal risks, as demonstrated by the following case study:
A Cautionary Tale You’d Want to Heed
An American IT company collaborated with a Slovakian freelancer for about three years. Concerned about potential misclassification risks, they considered formalizing this relationship through full-time employment. Although they initially declined an employment offer due to cost concerns, the relationship soured within six months. The freelancer approached labour authorities, exposing the company to potential fines and back payments totalling around €70,000.
To help you make an informed choice, here are five compelling reasons for transitioning freelancers to full-time employees in Saudi Arabia, backed by our expertise as a leading Global Employer of Record (EOR) in the region:
1. Risk Mitigation
Official employment through a Global EOR like us ensures 100% compliance, eliminating the financial and legal risks associated with misclassification. Your intellectual property and customer base remain secure.
2. Local Business Acumen
Full-time employees in Saudi Arabia offer on-the-ground insights and a deep understanding of local business culture, enhancing your competitive edge.
3. Language and Communication
By employing local talent, you benefit from professionals who can effectively communicate in the local language, bridging any cultural or linguistic gaps.
4. Cost and Time Efficiency
Our Global PEO solutions in Saudi Arabia are about 30% less expensive than in-house engagement and can save you up to 50% in costs compared to establishing your own legal entity. This enables you to focus your resources on your core business activities.
5. Employee Loyalty and Retention
Studies indicate that formal employment boosts employee loyalty by 47%, allowing you to retain top-tier talent for the long term. This is especially critical in competitive sectors like IT.
Additional Advantages: Flexibility and Scalability
With our EOR services, you can maintain operational flexibility while taking on projects of varying durations. Whether you are starting with just one employee or planning to scale, our services adapt to your needs.
To assist you further, we offer an ‘Employee vs. Independent Contractor’ checklist that covers all essential factors to consider when deciding.
Transitioning freelancers into full-time employees mitigates risks and offers many benefits, including cost savings, increased loyalty, and a deeper understanding of the local market. By doing so, you’re well-positioned to capitalise on the Saudi Arabian market’s opportunities.