If you don't have the resources or expertise to pay and manage your remote Mexican hires, consider outsourcing some or all of your human resources (HR) functions to a professional employer organization (PEO). A PEO is a full-service HR outsourcing company that performs various employee admin tasks on your behalf, such as benefits administration and payroll.
Read on to learn more about international PEOs and the benefits of using a PEO provider to manage and pay remote Mexican hires. We'll also provide tips for picking the best global PEO service company in Mexico.
An international or global PEO is a PEO that provides HR services to startups with outsourced staff. Most international PEOs offer a wide range of services, including payroll, tax, risk management, and benefits administration.
Small and midsized startups often use PEOs for supporting strategic and critical HR management. This gives them more time to focus on their business goals and core competencies, such as creating, selling, and improving the services and products that make their brand stand out.
PEOs and global employment organizations (GEOs) can both help you perform HR tasks. However, they're not the same.
Here's a summary of the main differences between PEOs and GEOs:
As you can see, there are many advantages to partnering with GEOs. However, there are also many disadvantages, such as:
GEOs offer many advantages, especially if you don't have the resources or time to register your business in Mexico. But, PEOs also have a lot of advantages, especially if you prioritize quality and flexibility over cost.
Here are the main advantages of hiring PEO providers:
International PEOs offer a full suite of HR services to pick and choose from.
Most PEO companies provide the following:
As covered above, PEOs are less likely to rely on outsourcing. They're also more likely to hire Mexican HR managers, which means your hires will get a more streamlined experience.
Regulatory violations and employee claims can damage your reputation, drain resources, and remove focus from profit-driving activities.
That's why you should partner with a PEO. Top-notch PEOs are caught up with relevant tax and labor laws, so you can rest assured that you'll always be on the right side of the law.
Most PEO services start after workers are hired, but some offer talent sourcing, recruitment, and management. They may also offer benefits for boosting engagement and reducing turnover, such as:
PEOs often use powerful HR tools that in-house HR departments lack. They also offer benchmarking and data analytics services that offer insight into your workforce. With the right HR expertise, data, and tools, you'll be able to derive clearer answers to mission-critical questions, including:
Paying and managing remote Mexican hires can be a time sink. This is especially true if you're a small or mid-sized business that distributes HR tasks across multiple departments. An experienced PEO can accelerate the employee management process by accelerating risk management, international payroll, business registration, and getting the right insurance for your startup.
Finally, PEOs offer a lot for very little. Google reveals that they usually cost around 2% to 11% of your wages, amounting to approximately $500 to $1,500 per employee annually. This isn't a lot, especially if you have a small team.
An international PEO in Mexico can help you source, onboard, pay, and manage Mexican employees according to relevant tax and labor laws.
When you sign a contract with a PEO in Mexico, you and the PEO will share employer responsibilities.
The PEO is typically responsible for the following:
Depending on your preferences and budget, you can outsource all or some of the tasks above.
This leaves you responsible for:
Many factors affect PEO pricing, including:
Every PEO has an initial setup fee when you sign a contract with them. These one-time setup fees cover all of the services needed to get your business up and running with a PEO, including:
Initial setup fees vary depending on your chosen PEO, but you can usually expect to pay $50 to $200 per employee.
Some companies and services may require additional annual or setup costs. For instance, companies that use PEOs to manage profit-sharing plans will owe a setup fee for the plan, along with an annual service fee.
PEOs' administrative costs are a set rate that accounts for all of the work required to manage your company account, such as:
If your PEO offers additional services, you will have to pay for them. These typically include:
Prices vary greatly depending on the service and the company. Ask your PEO to provide clear pricing for these services in advance.
If you're interested in working with a PEO, here are some tips for choosing the best PEO service for your Mexican hires.
First, you must assess how much HR assistance you need.
Chances are, if you only need to pay a few freelancers for part-time work, you won't need to partner with a PEO. This is because labor laws in Mexico only apply to employees, not freelancers. As such, the risks of running amok local laws and regulations are low, especially if you do your research.
On the other hand, if you're hiring a full-time remote development team from Mexico, you should work with a PEO. A PEO will accelerate the payroll and benefits administration process and make sure you're complying with relevant Mexican laws.
Next, you need to use the right keywords to locate your ideal PEO. Here are some keyword suggestions:
After you've created a list of PEOs, email them about your needs. You should also ask the following questions to learn more about their services:
PEOs are a cost-effective way to manage and pay remote employees in Mexico. Unfortunately, sourcing employees is often the most challenging part, especially in competitive industries like Web3 development and data engineering.
Luckily, we at Revelo are here to help. Latin America's leading tech talent solution, we provide recruitment and PEO services. To get started, just tell us about your job requirements and we'll send you a list of pre-vetted talent. We can also help you handle payroll, benefits, compliance, and more.
Fill in this form to start working with us.
We can provide professional employer organization services for all these countries in Latin America.