Hiring remote software engineers

More specifically, Remote’s 2022 Tech Talent Report surveyed 1,485 global executives and HR managers from the US, UK, Germany, France, the Netherlands and Sweden who are hiring tech talent to better understand their perspectives on emerging tech hubs. The report highlights misconceptions about remote hiring that may prevent companies from sourcing top tech talent in less competitive markets.

Our research identified that firms open to international remote hiring are still missing opportunities by focusing too heavily on traditional tech hubs. This represents a lost chance, since these locations show signs of a talent market under strain.

Sell your role: a job ad is more than a job description

One of the simplest ways to stand out in a tight market is to promote your vacancy more persuasively than competitors.

Too many employers treat a job description as merely a checklist of requirements. That approach makes it harder for your vacancy to appeal to top candidates who might be scanning hundreds of ads for a genuinely compelling opportunity.

A little extra effort up front will make your job advert stand out. Emphasise growth opportunities, any distinctive benefits you offer, and convey your company’s culture and values. Explain how you will support and develop each new hire to show your organisation cares.

"Job boards attract two main groups: those out of work who need a job, and those already employed who might be tempted by a new opportunity. A plain job description will likely reach the first group, but the second must be persuaded. Your advert should focus on what that person will gain from working for your company. Show why doing their job at your company is better. There should be less ‘Our requirements are’ and ‘Our mission is’ and more ‘You will impact these areas of the business’ and ‘You will be passionate about’. Capture the reader’s attention and make them excited to interview."

Yasmine Grey, Senior Talent Sourcer at Remote

Setting the right expectations will also attract top international talent. This reflects your organisation’s professionalism and demonstrates care for each candidate. Small additional efforts like these can make a considerable difference in helping your offer rise above the rest.

Keep your recruitment process as short as possible and adhere to a maximum timeline. Very long processes with numerous interview rounds, detailed psychological questionnaires and unpaid technical tasks demand a lot of time from candidates. The most experienced professionals are busy. They will not want to work for free and often avoid lengthy, cumbersome processes. A CV can speak for itself; you can assess cultural fit during interviews and confirm performance with reference checks.

Engineers occupied in their current roles cannot commit to protracted and demanding interview procedures. Streamline where possible and be ready to explain the purpose of each stage to the candidate.

Example process overview to include in job adverts

A concise overview like the example below can be added to your job advert to set clear expectations and reassure candidates their time commitment will be reasonable:

1

Interview 1 with HR

To assess cultural fit and values alignment

2

Salary discussion with HR

To ensure compensation expectations align

3

Interview 2 with line manager

To evaluate technical ability and experience

4

Interview 3 with a team member

Opportunity for the candidate to ask questions

5

Interview 4 with a team member

To validate mindset and strategic aptitude

Use proactive strategic sourcing to cherry-pick top global software engineers

The most successful recruitment teams tailor their approach for hiring remote software engineers. Finding and enticing world-class developers is challenging. The global shortfall means you must work smarter and harder to win the competition.

Amina Moreau, CEO and co-founder of Radius highlights the importance of transparency in recruitment. By leading with authenticity, hiring managers can foster a more open conversation with top remote engineers to assess the mutual suitability during interviews.

"Because it is as important for candidates to ensure we are the right fit for them, we begin by being open about who we are, how we work, our strengths and our weaknesses. As a startup, we operate differently to established firms, so we are candid about our financial position, what our current stage means for a new teammate, and both the upsides and downsides of joining a startup. Starting conversations with transparency makes candidates feel more comfortable sharing their own work styles and preferences, which speeds up the relationship and enables a truer assessment of alignment."

Amina Moreau, CEO and co-founder of Radius

The most overlooked aspect of hiring remote software engineers

The answer is straightforward.

Decide clearly how you will verify that candidates embody your company values.

Recruiting the best engineers is not an exact science. The top candidate for one organisation may be unsuitable for another. Your hiring process should shift from “finding the best engineers” to “finding the engineers best suited to your team”.

Lisbon-based Sergio Pereira is CTO at Bulk MRO Industrial Supply. An advocate of remote work, Sergio is constantly refining processes for his global team. He explains how Bulk MRO assesses cultural fit against company values to find the best remote software engineers.

"To ensure a candidate will fit the team, we involve several team members in the hiring process so they can assess how well a prospective engineer will blend with the team’s dynamics and contribute to our remote work culture. This cultural evaluation complements the assessment of technical skills required for the role."

Sergio Pereira, Chief Technology Officer at Bulk MRO Industrial Supply

Sergio offers practical guidance for leaders looking to raise retention and enhance this part of the hiring process.

It is not enough to understand your own company culture and values.

Your team must know how to ask the right questions to reveal whether a candidate acts in line with your values.

Remote’s recruitment team looks for engineers who are team players. The ideal fit for Remote is a strong communicator who is collaborative, ambitious, self-driven and curious.

"At Remote we focus on operationalising our values. We genuinely care about this and recruit accordingly. There is a technical baseline to meet and we seek developers creative enough to write excellent code. But we do not need ‘technical superstars’ who prefer to work alone. We want collaborators. That is our interview focus. I deliberately ask questions to see how candidates would behave in specific situations. I look for responses that show care and humility. This is how we test teamwork and collaboration skills."

Gabriela Suarez, Expert Recruiter at Remote

When is the best time to assess values alignment?

The first screening call with a recruiter.

Although all participants in the hiring process should evaluate candidates against your values and mission, this stage is particularly suited to exploring values in depth.

Use this time to determine whether the candidate demonstrates the behaviours you expect from a software engineer. Recruiters should concentrate on value-matching and can filter out candidates with cultural concerns, while later interviewers will assess technical skills and experience.

When you design a balanced, aligned and diverse interview process, you can proceed with confidence. A clear process reduces bias and lowers the risk of hiring someone who doesn’t align with your organisation and culture.

"The benefit of international hiring is clear and compelling — you open access to the world’s best talent. Value-based recruitment lays the groundwork for long-term success. Leaders who recruit new team members who share values can build an inclusive, equitable and trusting environment that enables a global team to thrive."

Anastasia Pshegodskaya, Director of Talent Acquisition at Remote

How hiring managers can prioritise diversity, equity and inclusion in practice

Many growth-minded leaders recognise the importance of prioritising diversity, equity and inclusion (DEI). Fewer, however, know how to turn this aim into practical steps, particularly in recruitment.

The Remote team is committed to transforming the world of work to provide top employment opportunities to anyone, regardless of their address.

Our hiring process is designed to find and provide opportunities to underrepresented groups. Below is a shortlist of practices you can implement now to diversify your team and introduce fresh perspectives to your organisation.

Chapter 3

The right benefits to attract top remote engineering talent

Good benefits can be as important, and sometimes more important, than a high salary. Remote software developers are in demand and want to work for companies offering the best balance of benefits and pay.

For many employees, even when wages are static, substantial company benefits foster a positive environment and a sense of value. Employers that provide competitive and cost-effective, value-based benefits such as flexible hours and asynchronous working can often attract and retain top talent even if they cannot match enterprise pay.

Remote software engineers often expect more than statutory entitlements as competition drives employers to offer extra perks. Candidates value autonomy through flexible and asynchronous work, a strong culture supporting diversity, share options, retirement savings and more.

Remote’s 2022 Global Benefits Report found that emphasising flexibility is a crucial incentive for top tech talent, with employees consistently ranking remote and flexible work as a top priority when considering job offers.

Recruiting international software engineers can be highly beneficial, but HR leaders must design an intentional and equitable remote compensation plan to both attract and retain top talent.

The straightforward way to provide competitive global compensation packages

Remote’s global employment platform can help you attract and retain top talent with locally relevant and compliant benefits packages in every country where you wish to hire. Our global benefits specialists design country-specific benefits packages and secure highly negotiated pricing.

You can offer equitable, leading benefits not only to remote developers but to your entire global team — at a fraction of the cost of doing it yourself or setting up local entities. You can even offer share options to your international workforce.

Ensure you meet local statutory obligations

Employers must provide several core benefits when hiring internationally. These statutory benefits (such as leave, social security and insurance) vary by country but are non-negotiable for any employer.

This nuance affects international employers, as benefits that exceed statutory requirements in one country may be less valued in another. Private medical insurance can be highly attractive in countries like the United States where public provisions are limited, whereas Australian employees tend to value it less because Medicare is robust and only 10% of Australian employers provide supplemental private medical insurance.

When recruiting internationally, familiarise yourself with secondary and non-traditional benefits in the markets where you wish to hire.

Software engineers value autonomy and flexibility as much as, if not more than, many other workers. Non-traditional benefits such as flexible hours are especially attractive for workers seeking a better life–work balance. Flexible benefits packages are particularly appealing to those already in remote roles.

Core benefits—sick pay, paid holidays, private medical insurance and retirement plans—are seen by many software engineers as essential. Cutting benefits during downturns could significantly harm employee satisfaction and retention.

Core benefits—sick pay, paid holidays, private medical insurance and retirement plans—are viewed by many software engineers as essential. Reducing benefits during economic slowdown may jeopardise employee satisfaction and retention.

Remote’s 2022 Global Benefits Report found decision-makers hiring internationally are leveraging the strong demand for flexible work as a competitive advantage to attract top remote talent.

When considering remote or flexible work, most leaders say the choice is motivated by a desire to improve retention, access new markets and respond to employee needs and requests.

How much should you pay remote software developers?

Determining pay is more complex in a global market with a mix of employees and contractors. Start by using an employee cost calculator to estimate typical developer costs in different countries. Then consult Remote’s Where to Hire Report to identify the best recruitment opportunities. Hiring developers wherever they are located makes sense in the remote era. It gives you access to an unlimited and diverse talent pool, proven to boost productivity and competitiveness. Having team members in countries where you are expanding is also valuable when entering new markets.

The cost of hiring internationally extends beyond the salary. Mandated employer taxes can raise total employee costs to roughly 1.25–1.4 times salary, depending on location.

For example, if you wish to hire an excellent software engineer in Argentina with a salary of USD 60,000 per year, you would face an extra $15,731.76 in mandated employer costs in Argentina, covering pension and contributions to public welfare and healthcare. Assess the entire package, not only payroll and taxes.

You must be competitive when recruiting and retaining staff. Avoid making insulting offers to prospective employees or contractors or risking reputational damage. Equally, avoid being priced out of a market or having to make redundancies when conditions change. Use resources such as Remote’s tools to guide your approach.

Chapter 4

How to stay compliant when recruiting developers across borders

There are several options for hiring remote developers overseas. You could open a local entity, hire through an EOR, or use an employer of record service.

Bear in mind every country has unique regulations and requirements for establishing an entity: from physical premises to tax and payroll obligations.

Set up your own local legal entity

If you opt to establish an entity, do not understate the investment required in setup and ongoing maintenance. The commitment is not only financial; the time needed to gain local market and legal knowledge often makes opening an entity impractical unless you plan long-term expansion into that country.

If you expect to hire fewer than around 25 employees in a country, forming an entity may not be cost-effective. Setup costs can be high, including bank accounts, tax registrations and possibly physical premises and staff. You will also need local legal advice to remain compliant.

Hire developers as contractors

Another route is to engage software engineers as contractors. This can be less burdensome than creating an entity, but it carries risks.

You may pay people as contractors rather than employees. However, you must classify workers correctly. Failure to do so can lead to fines and penalties, and may even result in a ban on hiring in that country.

Before hiring independent contractors, ensure the agreement would be regarded as a legitimate contractor relationship under local classification laws.

Use an employer of record to remain compliant

Engaging an employer of record (EOR) can be an appealing option for hiring remote developers in another country. With an EOR you can hire developers as full-time employees without establishing a local entity. If you use an EOR, you should know how to evaluate potential EOR partners.

Partnering with an EOR is often the most time- and cost-effective route for global employment in many cases, especially if you need to hire quickly or accept applications from multiple countries. An EOR removes the need to set up a local legal entity while shielding your business from certain compliance risks. The EOR employs the worker on your behalf and enters a service agreement with your company to protect the transfer of your intellectual property.

What is an employer of record (EOR)?

An EOR is a service that enables companies to hire people in other countries. EORs handle routine HR tasks such as payroll, tax and social contribution payments and benefits administration, and ensure compliance with local legislation. By using an EOR, the provider assumes the legal risk of local employment, helping you accelerate hires with less exposure to potential issues.

EORs are not co-hiring arrangements, as PEOs are. On paper, the EOR is the sole employer, but in practice they do not manage the day-to-day work of your staff.

Think of your EOR as your local HR team in another country. Ensure your EOR has the right presence in countries where you wish to hire, so you do not breach local law. It is essential to research and understand the terminology of the EOR sector.

How to hire remote developers with an EOR

In a survey of over 1,400 hiring managers, Remote’s 2022 Tech Talent Report showed hiring managers planning to recruit in new regions are concerned about how to remain compliant when employing international talent.

• 34% are hesitant about learning local legal hiring requirements.

• 31% worry about learning local payroll regulations.

• 26% say understanding local benefits packages is a challenge they prefer not to tackle.

• 23% are concerned about managing payroll.

These worries are real, but staying compliant when hiring abroad can be straightforward for companies serious about onboarding the right talent.

Hiring remote software engineers with an employer of record (EOR) is simple and direct if you choose the right partner. All you need to do is sign up for an EOR platform and begin onboarding employees.

The best EOR platforms will guide you through signing employment agreements, localising contracts and setting up payroll.

Once employees are onboarded, your EOR should manage payroll, benefits and tax obligations on your behalf. Remote can also provide relocation support, and manage equity incentives and share options for your international employees.

Relying on an EOR partner can save you thousands in legal fees and third-party costs — and time by centralising international employee management.

Using an EOR can be very helpful when hiring remote developers. EORs have specialist staff who enable hiring in countries where your company has no legal presence, and they offer local insight into talent pools and how to attract the right engineers for your needs.

Furthermore, EORs can support your remote hiring process. To attract top talent and stay competitive, companies must adapt to a new reality where the line between work and home is blurred and inclusivity is central to successful global recruitment.

Throughout hiring, EORs can advise on which benefits will attract remote software developers. Benefits can be the deciding factor in the final stages. A stronger benefits package may give your company the advantage when a top candidate compares offers.

Companies often focus on salary and take benefits for granted. You cannot afford to offer the bare minimum if you want to attract and keep top talent worldwide. With the right EOR, you can offer competitive benefits packages around the world, giving you an edge in recruiting the best remote engineers.

How to stay updated with changing local employment laws

Local employment laws combine written legislation, case law and customary practices. Depending on the country managing payroll, laws may be highly protective of employee rights or allow more employer flexibility.

To present a competitive international offer, you need to understand norms and expectations in the employee’s country. That includes basics of compliance, payroll practices, tax withholding and benefits administration.

Labour laws cover a range of topics, including:

• Minimum wage

• Parental leave

• Sector-specific benefits

• Paid leave

• Mandatory benefits

• Worker classification

Managing all these factors in one country is challenging enough. Add multiple countries and you would need to create a new division to handle the administration. That is a key reason many companies work with a global payroll services provider who understands the complexities.

Not all global payroll services are equal. Some providers outsource local duties to third parties, which can create a poor employee experience and expose your company to risks. If you plan to hire abroad, work with an owned-entity global payroll provider.

Each country handles payroll tax and compliance differently. Onboarding international talent is worthwhile, but don’t dive in without knowing what’s involved. A global payroll partner is one of the best ways to manage tax and payroll obligations.

Chapter 5

Managing payroll for global teams of remote software developers

Paying remote software developers can involve multiple considerations. The process can be straightforward even if you are hiring international employees, but you should consider several key points before onboarding and paying a new team member.

Employee or contractor?

First, consider worker classification. Should you engage remote developers as a contractor or an employee. This is not straightforward. Even if you intend to work with an engineer on a contract basis, local employment law matters and misclassification is a real risk.

What is misclassification?

Misclassification happens when a business assigns the wrong status to a worker, intentionally or not. While penalties are tougher for deliberate misclassification, businesses face consequences for honest errors too. Avoiding misclassification depends on conduct rather than intent: treat a worker as an employee and regulators may eventually deem them an employee, even if you did not intend to create that relationship.

There are several other practical considerations when paying international employees. Questions to ask include:

• In which currencies will you pay salaries and invoices?

• Do you hold currency accounts for each country where your workers reside?

• How will you transfer funds? Will you use a bank or a fintech provider?

• How will you pay employees who are relocating and do not yet have a bank account?

• What payment arrangement does your new employee prefer? Do they want payment in their local currency or yours, and is that legally permissible?

• How will you handle foreign exchange volatility?

What are the relevant local employment laws?

Each country where you employ staff will have specific rules about how to pay remote workers. This can include pay frequency, statutory benefits and withholding tax. Understanding these requirements before hiring is crucial to avoid fines and penalties.

The fastest, easiest and safest way to pay remote software developers

Whatever you decide, check local regulations and partner with a trusted global employment partner that can identify issues and reduce the risks of hiring in a new country.

Remote owns local legal entities in every country where our EOR services operate. Our global payroll software hub helps you manage payroll and taxes, administer benefits and ensure compliance for all employees, wherever they are based.

Remote is the world’s leading employer of record and our global payroll platform is designed to accelerate your international hiring goals.

• Simplify payments for both full-time employees and contractors in our easy-to-use platform

• Ensure compliance with local employment laws with support from our international legal experts

• Reduce payroll costs and streamline payment processes

If you’re ready, you can sign up now to begin onboarding employees and contractors worldwide in minutes. Have questions? Contact us today and one of our global employment specialists can advise you on growing your team.

How to handle taxes for remote software developers

Companies hiring engineers abroad must consider the tax implications (employer taxes vary by country of hire).

Large international companies have the HR resources to manage payroll tax and compliance globally. For small and medium-sized firms, it is more difficult: with limited resources it is challenging to compliantly pay international employees without hiring new payroll and legal staff in every country.

An employer of record simplifies matters. Remote’s platform is built to keep you compliant and to help navigate varying tax codes globally. Partnering with Remote will relieve pressure on your finance team and prevent non-compliance risks. An EOR will manage global payroll compliance on your behalf, enabling you to grow headcount without breaching international laws.

Running global payroll involves more than issuing pay on the first day of the month. Depending on the country and the worker type, payroll may require withholding taxes, wage calculations and compliance with unique local laws. This is time-consuming for internal HR, payroll, finance and legal teams.

How to offer share options to remote developers

Offering share options is an effective way to attract and retain talent, but it can be complex for privately held companies. You may wonder how to extend share options to remote developers abroad or how to legally expand an existing plan internationally.

An employee stock ownership plan (ESOP) can be a powerful tool to attract and retain great staff. People are more engaged and committed when they share in company success through profit sharing, share options or employee stock purchase plans. However, offering share options to full-time employees overseas can be complex.

Remote enables you to manage international stock option services for your global team, including setup and administration of equity incentives. We can help you include international employees in your ESOP legally and easily. Remote also handles tax withholding in multiple countries so you can benefit from a global equity plan without the administrative burden.

To realise the benefits of offering share options internationally, you must plan and execute your ESOP strategy effectively. Consider employee locations, tax handling and what your complete global benefits packages should include. Whether you want to offer stock to one remote developer or a distributed team, Remote can help.

Should you hire remote software developers as employees or contractors?

Understanding the distinction between contractor and employee is vital. Each option carries benefits and risks, and misclassification can be costly.

Deciding whether to engage an international contractor or hire an employee abroad requires a cost–benefit analysis, weighing contract management, local employment rules and compliance risk. Knowing how to remain compliant is essential to avoid legal consequences. Understanding the difference is half the battle.

An international contractor is someone who lives in another country while performing work for your company but is not a full-time employee. In this case you are the client rather than the employer. An international contractor is not your employee and typically agrees to work under certain conditions:

International contractors are responsible for the work you contract. They may have multiple clients. Contractors are effectively self-employed and accountable for running their own businesses.

Employees are hired to work over a longer term, usually for a single employer. They may lead teams or manage ongoing projects. Unlike contractor agreements, employee contracts typically do not have fixed end dates. Classification risk centres on employment duration and duties.

Employees work for an employer over an extended period and often exclusively for that business. They may oversee teams or deliver multiple long-term projects. Employee contracts typically lack expiry dates; classification hinges on length of engagement and responsibilities.

Factors to consider when hiring remote developers include the projects they undertake and who owns the IP created. Remote work introduces new vulnerabilities in this area.

If you fail to create compliant contracts and misclassify workers, you could find a contractor in another country owns IP you expected to own.

This does not mean you should avoid hiring abroad. On the contrary, a global workforce is a strategic strength, especially for smaller companies. However, companies must manage risks carefully. Each country has its own IP laws, and you must understand the nuances to protect your interests.

Remember contractors may split their attention between your work and others’. Understand local non-disclosure, IP law and how the information shared with a developer fits these protections.

Because IP protection is crucial, Remote created Remote IP Guard to secure your IP when hiring internationally. With Remote IP Guard you receive the maximum transfer of IP rights when hiring abroad.

Chapter 6

How to work with remote developers

Working with remote developers can be challenging. Many prefer flexibility and do not flourish in restrictive settings. They like to work when at their most creative and value autonomy to develop, test, fail and find solutions. When considering how to manage remote employees, remote software engineers are often a primary focus.

Many developers prefer to work at their own pace. This structure can be difficult for firms used to a conventional 9–5 schedule. When hiring internationally, you must adapt to various schedules and time zones. There is, however, a solution in asynchronous work.

Asynchronous (async) work allows remote developers to perform at their best by working at times that suit them, regardless of others’ hours. In async work, immediate replies are not expected, enabling deeper focus. The key is to establish processes that let employees work autonomously and earn trust.

In short, async work is not about procrastination or isolation. It allows employees to find a flow state to produce high-quality work efficiently. Async work enables remote developers to focus on outcomes rather than micromanagement.

Synchronous work planning

Typical synchronous planning schedules tasks in bulk. While not inherently flawed, a system progresses at the pace of its slowest element; any delay is propagated through the pipeline since each stage depends on completion of the previous one.

The diagram illustrates a three-stage software development pipeline organised with synchronous planning. To deploy a feature, tasks A, B and C must all be completed before deployment, which can slow delivery, especially across time zones.

Asynchronous work planning

Async planning breaks tasks into smaller pieces and releases Minimum Viable Changes (MVCs) frequently. This approach allows more frequent delivery, measurable outcomes and quick correction of issues.

In this example, separating Tasks A, B and C could produce three times as many deploys as the synchronous model (M1). Multiplexing tasks with async work gives more time to validate effects and to roll back or reassess next steps. Iteration time can be reduced to one-third of the original plan.

Overall, the async method enables developer teams to multiplex tasks, combine efforts and deliver faster while working across time zones without waiting for others’ completion.

How to protect your intellectual property with remote software developers

Protecting your IP is essential. How can you ensure your information is secure with remote employees worldwide, some of whom may be contractors working for multiple companies?

To safeguard your IP, remember creation may be cross-border. Some countries favour commissioners, others favour creators. This does not mean contractors will automatically own IP, but you must take care with contracts and working arrangements.

IP rights are straightforward when everyone works in the same office: work done on company time, using company equipment, typically belongs to the employer. That structure protects many companies from IP disputes, but for tech firms working with international engineers, IP and invention rights can be complex. Many countries lack clear rules for different types of tech IP. Employers with foreign engineers, programmers and product teams must be vigilant.

Working with an EOR such as Remote gives you the expertise and security to reduce IP risk. Remote delivers the industry’s most reliable IP protections through Remote IP Guard, Remote’s proprietary system for international IP protection. As a leading global employment provider, Remote helps companies protect IP across dozens of countries from internal and external exposure.

Start hiring remote software engineers to grow your business

Hiring a remote software developer can seem daunting. The first step is committing to strengthening your team — the second is partnering with experts for legal, social, compliance and payroll support, whether via an EOR or through your own entity and local partners.

There will be obstacles along the way. Stick to your plan and assemble the right resources, and you will find the developers who broaden your team’s skills and enhance innovation.

Opening your business to a global pool of skilled remote software engineers will futureproof recruitment and build a foundation for sustained success.

Remote provides the tools and flexibility to fill gaps and offer protection where it’s needed most. Contact our global team if you would like more information on getting started with hiring and paying remote software developers.