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 learn more about their views of emerging tech hubs. The report highlights misconceptions about remote hiring that may prevent businesses finding top talent in less competitive markets.

Our research found that companies open to international remote hiring still overlook value by concentrating too heavily on established tech hubs. This represents a missed chance, since those locations show signs of strain in their tech talent markets.

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

One of the simplest ways to stand out in a tight talent market is to present your role more attractively than competitors.

Too many employers reduce a job advert to a list of requirements. That approach makes it harder to catch the attention of high-quality candidates who may be scanning hundreds of listings for genuinely compelling opportunities.

A bit of effort at the start will help your ad stand out. Emphasise growth opportunities, unique benefits, and your company’s culture and values. Explain how you will support and develop each hire to show your organisation cares about its people.

"Job boards attract two main groups: people seeking work and those already employed who might be tempted by a new opportunity. Posting a JD is likely to reach the first group, but the second needs convincing. Your ad should focus on what that person will gain from joining your company. Show why it’s better to do their job with you. There should be less ‘Our requirements are’ and ‘Our mission is’ and more ‘You will impact these parts of the business’ and ‘You will be passionate about’. Grab the reader’s attention and make them eager to interview."

Yasmine Grey, Senior Talent Sourcer at Remote

Setting clear expectations will also appeal to top international candidates. It shows professionalism and care for each applicant. Small additional efforts like this can make a big difference in helping your offer stand out.

Keep your process as short as possible and stick to a firm timeline. Very long processes with many interview rounds, lengthy psychological questionnaires and unpaid technical tasks take significant time from candidates. The most experienced professionals are busy, won’t work for free and will likely avoid such cumbersome processes. A CV speaks for itself; you can gauge cultural fit in interviews and verify performance with references.

Engineers active in their current roles cannot commit to lengthy, demanding interview processes. Streamline where you can and be prepared to explain why each step matters to the candidate.

Example process overview to add into job advertisements

A concise overview like the example below can be placed in your job advert to set expectations and show 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 matching compensation expectations

3

Interview 2 with line manager

To assess technical ability and experience

4

Interview 3 with team member

Chance for the candidate to ask questions

5

Interview 4 with team member

To validate mentality and strategic aptitude

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

The most effective recruitment teams adapt their approach for hiring remote software engineers. Finding and attracting world-class developers is difficult. The global shortage means you must work harder and smarter to beat the competition.

Amina Moreau, CEO and co-founder of Radius highlights the value of transparency in recruitment. By being open and authentic, hiring managers can have more honest conversations with senior remote engineers to assess mutual fit during interviews.

"Because it’s important our team is the right fit for candidates, we start by being transparent about who we are, how we work, our strengths and our weaknesses. As a startup we operate differently from larger firms, so we are open about our financial position, what our stage means for someone joining, and both the upsides and downsides of startup life. Beginning conversations with transparency helps candidates feel comfortable discussing their own work styles and preferences, which speeds up rapport and gives a truer sense 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.

Hiring top engineers isn’t an exact science. The best candidate for one organisation might be a poor fit for another. Shift your recruitment aim from “finding the best engineers” to “finding the best-suited engineers for your team”.

Lisbon-based Sergio Pereira is CTO at Bulk MRO Industrial Supply. As a strong proponent of remote work, Sergio continually seeks to improve internal processes for his distributed team. He explains how Bulk MRO assesses candidates’ cultural fit against company values to find the best remote engineers.

"To ensure a candidate fits our team, we involve multiple team members in hiring so they can judge how well a prospective engineer would integrate with team dynamics and contribute to our remote culture. This cultural evaluation complements technical assessments and is crucial to selection."

Sergio Pereira, Chief Technology Officer at Bulk MRO Industrial Supply

Sergio offers useful advice for leaders aiming to raise retention and improve the recruitment process.

It’s not enough to know your own company culture and values.

Your team needs to ask the right questions to reveal whether a candidate operates by your company values.

Remote’s recruitment team looks for engineers who work well in teams. The ideal fit for Remote is a clear communicator who is collaborative, ambitious, self-driven and curious.

"At Remote we strive to operationalise our values. We recruit accordingly. There is a technical baseline, but we don’t need solitary ‘technical superstars’. We need collaborators. During interviews I ask how candidates would act in specific situations, looking for answers that show care and humility — that’s how we test for teamwork and collaboration."

Gabriela Suarez, Expert Recruiter at Remote

When is the perfect time to analyse a value-match?

The first screening call with a recruiter.

Although all parts of the hiring process should assess candidates against your values and mission, the recruiter screening is a perfect opportunity to explore this deeply.

Use this time to evaluate whether the candidate demonstrates the behaviours you want in an engineer. Recruiters can focus on value matching and filter out candidates with cultural concerns, while later interviewers assess technical skills and experience.

With a balanced, aligned and diverse interview process you can execute hiring confidently. A clear process helps reduce bias and lowers the chance of hiring someone who does not fit your organisation and culture.

"The benefit of international hiring is clear and compelling – it opens access to the world’s best talent. Value-based hiring lays the foundation for long-term success. Leaders who hire people with shared values can build an inclusive, equitable and trusting environment that allows 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 understand the importance of diversity, equity and inclusion (DEI). Fewer know how to turn that aim into practical steps, especially in recruitment.

The Remote team is committed to widening work opportunities for people everywhere, irrespective of their home address.

Our recruitment process is designed to find and give opportunities to underrepresented groups. Below are practical practices you can adopt now to diversify your team and bring fresh perspectives to your organisation.

Chapter 3

The right benefits to attract top remote engineering talent

Good benefits are often as important — or more so — than a high salary. Remote software engineers are in demand and favour employers who offer the best combination of pay and benefits.

For many employees, even if pay is static, substantial company benefits foster a positive environment and sense of value. Firms offering competitive and cost-effective value-based perks like flexible work and asynchronous practices can attract and keep top talent even when they cannot match enterprise salaries.

Remote software engineers often expect more than statutory benefits; competition drives employers to add perks beyond legal minima. Candidates seek autonomy through flexible and async work, strong inclusive culture, 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 top priorities when weighing offers.

Hiring international software engineers can deliver huge advantages, but HR leaders must build an intentional and fair remote compensation plan to both attract and retain top talent.

The simple way to offer competitive global compensation packages

Remote’s global employment platform helps you attract and retain top talent with locally relevant, compliant benefits in every country you hire. Our global benefits specialists create country-specific benefits packages with the advantage of negotiated pricing.

You can offer fair, best-in-class benefits not only to remote developers but to your whole global team, for a fraction of the cost and complexity of handling it yourself or setting up a local legal entity. You can even offer share options to your international workforce.

Ensure you meet local statutory obligations

There are core benefits employers must provide when hiring internationally. These benefits (such as leave, social security and insurance) differ by country, but they are non-negotiable for any employer.

This variation matters: benefits you offer beyond statutory requirements in one country may carry less weight in another. Private medical insurance is highly valued in places like the United States where public provision is limited, whereas Australian employees place less value on it because Medicare is comprehensive and only 10% of Australian employers offer additional private medical cover.

When recruiting globally, familiarise yourself with secondary and non-traditional benefits valued in the markets where you hire.

Software engineers prize autonomy and flexibility as much as — if not more than — many other workers. Non-traditional perks like flexible hours appeal strongly to those seeking a healthy life–work balance. Flexible benefits are especially attractive to people already in remote roles.

Essential core benefits — such as sick leave, paid holidays, private medical insurance and retirement plans — are viewed by many engineers as non-negotiable. Reducing benefits in a downturn can seriously damage satisfaction and retention.

Essential core benefits — such as sick leave, paid holidays, private medical insurance and retirement plans — are viewed by many engineers as non-negotiable. Reducing benefits in a downturn can seriously damage satisfaction and retention.

Remote’s 2022 Global Benefits Report found that decision makers who hire internationally use the strong demand for flexible work as an advantage to attract top remote talent.

When offering remote or flexible work, most leaders say it’s driven by retention needs, access to new markets and responding to employee requests.

How much should you pay remote software developers?

Setting pay becomes trickier when you recruit globally across a mix of employees and contractors. Start with an employee cost calculator to see typical developer costs by country. Then consult Remote’s Where to Hire Report to identify the best hiring opportunities. Hiring developers from wherever they are makes sense in the era of remote work — it gives you access to a limitless and diverse talent pool and can boost productivity and competitiveness. Having team members in markets where you operate is also useful when expanding internationally. Hiring software developers from wherever they can be found makes perfect sense in the era of remote work. Doing so affords you the flexibility to access an unlimited and diverse talent pool, a move proven to boost your company’s productivity and competitive edge. Having team members on the ground in a country where you’re developing your business is also crucial when you’re expanding to new markets.

The cost of hiring internationally goes beyond salary. Mandated employer taxes can raise total employee costs to around 1.25–1.4 times salary, depending on the employee’s country of residence and work.

For example, say you want to hire a great software engineer based in Argentina with a salary of USD 60,000 yearly. In this example you would incur an extra $15,731.76 in Argentina’s statutory employer costs, including pension and social welfare contributions. Consider the whole package, not just payroll and taxes.

You must be competitive when hiring and retaining talent. Avoid offering insulting packages to candidates or damaging your reputation. At the same time, don’t overpay into an unsustainable market or face layoffs when conditions change. Use resources like Remote’s to guide your decisions.

Chapter 4

How to stay compliant when recruiting developers across borders

There are several ways to hire developers abroad. You can set up your own legal entity in the country, hire via an EOR, or use an employer of record service.

Bear in mind each country has its own rules for forming an entity: from physical premises to payroll and tax obligations.

Launch your own local legal entity

If you opt to open an entity, don’t understate the investment required in setup and ongoing maintenance. It’s not just financial: the time taken to learn local market nuances and legislation often makes opening an entity impractical unless you plan a long-term presence in the country.

If you expect to hire fewer than about 25 employees in a country, setting up an entity may not be cost-effective. Entity setup involves bank accounts, tax registration, potentially premises and staff, plus local legal advice to remain compliant.

Hire developers as contractors

Another option is engaging software engineers as contractors. This can be less burdensome than forming an entity, but it carries risks.

You might pay people as contractors rather than employees. However, you must correctly classify your workers. Misclassification can lead to fines, penalties and even a ban on hiring in that country.

Before hiring contractors, ensure the contract would be viewed as a legitimate contractor relationship under local classification laws.

Use an employer of record to stay compliant

Working with an employer of record (EOR) is an attractive option for hiring remote developers abroad. With an EOR you can employ developers as full-time staff without opening a local entity. If you use an EOR, learn how to evaluate potential EOR partners.

Partnering with an EOR is often the most time- and cost-effective solution for global employment in most cases, especially if you need to hire quickly or accept applications from multiple countries. An EOR avoids the need to set up local legal entities while shielding you from many compliance risks. The EOR employs the worker on your behalf and agrees a service contract with your company to protect intellectual property transfers.

What is an employer of record (EOR)?

An EOR is a service that helps companies hire people in other countries. EORs manage day-to-day HR tasks such as payroll, tax and social contribution payments and benefits administration, ensuring compliance with local law. The EOR accepts the legal employment risk locally, enabling you to hire more quickly with less exposure to potential issues.

EORs are not co-hiring arrangements, like PEOs are. Legally your EOR is the employer, though they don’t manage day-to-day work.

Think of your EOR as your local HR team in another country. Ensure your EOR has the right presence where you want to hire so you remain compliant. It’s essential to research and understand the EOR vernacular.

How to hire remote developers with an EOR

In a survey of over 1,400 hiring managers, Remote’s 2022 Tech Talent Report found that managers who plan to hire in new regions worry about staying compliant when employing international talent.

• 34% are reluctant to learn local legal requirements for hiring.

• 31% worry about understanding local payroll rules.

• 26% say understanding local benefits packages is a challenge they don’t want to tackle.

• 23% are concerned about payroll management.

These are valid concerns, but staying compliant while hiring abroad is manageable for companies committed to onboarding the right talent.

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

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

After onboarding, 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 saves time by centralising international employee management.

Using an EOR can be a useful tool for hiring remote developers. EORs have specialist teams to help you hire in countries where you have no legal presence, and they provide local insight into talent pools and how to attract suitable software engineers for your needs.

Additionally, EORs can assist throughout the hiring process. To attract top talent and stay competitive, companies must adapt to the new reality. The distinction between work and home is blurrier than ever, and inclusivity is central to successful global recruitment.

Throughout hiring, EORs can advise on which benefits will attract remote software developers. Benefits and perks can be decisive at the offer stage. A strong benefits package can give your organisation an advantage when candidates compare offers.

Companies sometimes take benefits for granted and focus on salary. You can’t afford to offer the minimum if you want to attract and retain top global talent. With the right EOR, you can offer competitive benefits packages worldwide, giving your company an edge in the search for top remote engineers.

How to stay updated with changing local employment laws

Local employment law combines legislation, case law and customary practices. Depending on the payroll location, laws can be highly protective of employee rights or more flexible regarding payroll management.

To make a competitive offer to an international employee, you need to know local norms and expectations, including compliance basics, payroll practice, tax withholding and benefits administration duties.

Labour laws cover a range of topics, including:

• Minimum wage

• Parental leave

• Sector-specific benefits

• Paid leave

• Mandatory benefits

• Worker classification

Accounting for all these factors in one country is challenging. Add multiple countries and you’d need a whole new arm of your company to manage the administration alone. That’s a major reason many firms work with a global payroll services provider who already knows the rules.

Not all global payroll services are equal. Some outsource local duties to third parties, creating a poor experience for employees and exposing your company to additional risk. If you want to hire abroad, choose an owned-entity global payroll provider.

Every country treats payroll tax and compliance differently. Onboarding international talent is worthwhile, but don’t proceed without understanding the implications. A global payroll partner is one of the best ways to handle varied tax and payroll requirements.

Chapter 5

Managing payroll for global teams of remote software developers

Paying remote software developers can be complex. The process can be straightforward, even when hiring international employees, but you must consider some key issues before onboarding and paying new team members.

Employee or contractor?

First, determine worker classification. Should you engage remote developers as a contractor or an employee. This is not straightforward: even if you intend a contracting relationship, local employment laws may mean misclassification is a risk.

What is misclassification?

Misclassification happens when a worker is assigned the wrong status, whether unintentionally or deliberately. Although penalties are harsher for deliberate misclassification, firms can still face fines for honest mistakes. Avoiding misclassification is about actions rather than intent: treat someone like an employee long enough and regulators may deem them so, regardless of your intent.

There are other considerations around the mechanics of paying international employees. Ask yourself:

• In what currencies will you pay salaries and invoices?

• Do you have currency accounts for every country where your workers live?

• How will you transfer funds — via bank or fintech provider?

• How will you pay employees who are relocating who don’t yet have a local bank account?

• Which currency does your new employee prefer? Local or your home currency — and is it legal to pay that way?

• How will you manage foreign exchange volatility?

What are the local employment laws you must follow?

Each country where you have staff will specify rules about how to pay remote workers. This covers pay frequency, required statutory benefits and withholding tax. Know the rules before hiring to avoid fines or penalties.

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

Whatever choices you make, check local regulations and work with a trusted global employment partner who can spot issues and reduce risks when you hire 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 employees wherever they are based.

Remote is a leading employer of record and our global payroll platform is built to help you accelerate international hiring.

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

• Guarantee compliance with local employment laws with the help of 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 experts can advise you to accelerate your team’s growth.

How to handle taxes for remote software developers

Companies hiring engineers abroad must understand employer tax liabilities, which vary by country.

Large multinational firms have the HR resources to handle payroll tax and compliance globally. For smaller companies, it’s harder. With limited resources, managing compliant payment of international employees without adding payroll and legal staff in every country is difficult.

An EOR simplifies tax and payroll. Remote’s platform helps you comply with different tax systems worldwide. Partnering with Remote removes pressure from your finance team and avoids compliance risks. An EOR will manage global payroll compliance on your behalf so you can grow headcount without breaching international laws.

Running global payroll involves more than issuing payslips. Depending on country and employee type, payroll can include tax withholding, wage calculations and compliance with local employment law. This is time-consuming for internal HR, payroll, finance and legal teams.

How to offer share options to remote developers

Share options are among the best tools to attract and retain talent. For private companies, offering options abroad can be tricky. You may wonder how to extend your share plan to remote developers overseas or how to expand an existing plan internationally.

An employee stock ownership plan (ESOP) is a powerful incentive. People engage more and commit to shared success when they own part of the outcome. Profit-sharing, share options and employee purchase plans reward contributors and motivate them to perform. But offering options to international employees can be complex.

Remote allows you to manage international stock option services for your global team (including setup and management of other equity incentives). We help you bring international employees into your ESOP legally and easily. Remote handles tax withholding in multiple countries so you can run a global equity plan without the administrative burden.

To gain the benefits of offering share options internationally, you must plan and execute your ESOP strategy effectively. Consider where employees live, tax handling and what your complete global benefits packages should include. Whether you want to grant stock to a single remote developer or an entire distributed team, Remote can help.

Should you hire remote software developers as employees or contractors?

Understanding the difference between contractor and employee is vital. Both have advantages and risks, and misclassification can be costly.

Choosing between an international contractor and an employee requires a cost–benefit analysis and consideration of contract management, local employment rules and compliance. Knowing how to stay compliant avoids expensive legal issues.

An international contractor is a person who lives in another country while working for your company but is not a full-time employee. You are the client rather than their employer. An international contractor is not your employee, but they agree to work with you in defined ways:

International contractors are accountable for the contracted work and may have multiple clients. Contractors are technically self-employed and responsible for managing their own business.

Employees work for an organisation for a longer period, usually for one employer exclusively. They may supervise teams or manage multiple long-term projects. Employee contracts typically have no end date; classification risk depends on employment duration and duties.

Employees work for an organisation for a longer period, usually for one employer exclusively. They may supervise teams or manage multiple long-term projects. Employee contracts typically have no end date; classification risk depends on employment duration and duties.

When hiring remote software developers, consider the projects they undertake and who owns the IP created. Remote work raises new vulnerabilities around these issues.

If you don’t draft compliant contracts and misclassify workers, you could find a contractor in another country owns IP you assumed belonged to you.

This doesn’t mean you should avoid hiring abroad; a global workforce is a major advantage. But be careful to avoid unnecessary risk as you grow your international team. IP laws vary by country and you must understand local nuances to protect yourself.

Remember contractors may split their attention between your business and others. Understand non-disclosure agreements, local IP law and how the information you share with developers fits into these protections.

To protect your IP, Remote created Remote IP Guard to ensure you receive the maximum transfer of IP rights when hiring internationally.

Chapter 6

How to work with remote developers

Working with remote developers can present challenges. Many prefer flexibility and don’t thrive under rigid structures. They work when creativity strikes and value the autonomy to develop, test, fail and find solutions. When thinking about how to manage remote employees, software engineers are often a primary focus.

Many developers work best at their own pace. This approach can be unfamiliar to organisations used to a 9–5 structure. Hiring internationally requires adapting to varied schedules and time zones. There is a solution: asynchronous work.

Asynchronous (async) work lets remote developers do their best work at times that suit them, regardless of when others are online. In async work, immediate responses aren’t expected, so people can focus and reduce pressure. The key is establishing processes that enable autonomy and trust.

In short, async work is not procrastination or isolation. It helps employees enter a flow state to produce high-quality work efficiently. Async methods enable remote developers to focus on outcomes rather than micromanagement.

Synchronous work planning

Typical synchronous planning kicks off work in large batches. While not always bad, systems slow to their slowest component; delays propagate because each stage depends on the previous one.

The workflow diagram shows a three-stage development pipeline using synchronous planning. To deploy a feature, tasks A, B and C must all complete before deployment, which can slow production, especially across time zones.

Asynchronous work planning

Async planning focuses on breaking tasks into smaller pieces and releasing Minimum Viable Changes (MVCs) frequently. This lets you deliver more often, measure success and react to feedback quickly.

By separating Tasks A, B and C you could achieve three times as many deploys compared with the synchronous example. Multiplexing tasks with async work allows more validation time and faster iteration, reducing cycle time to a third.

Generally, async methods let distributed teams multiplex tasks, combine efforts for faster delivery and continue working across time zones without waiting for dependent tasks to finish.

How to protect your intellectual property with remote software developers

Protecting your IP is vital. How can you keep information safe with remote employees across many countries, some of whom may be contractors working for other companies?

To protect IP you must remember creation is often cross-border. Some countries favour company protections while others favour creators. That doesn’t mean contractors will own your IP, but you must be careful with contracts and overseas arrangements.

IP rights are simpler when everyone works in the same office: employees produce work on company time, using company property, and ownership is clear. With foreign engineers and varying national regulations, IP and invention rights can become complex. Companies with distributed tech staff must remain vigilant.

Using an EOR like Remote gives you the expertise and protections needed to prevent IP loss. Remote provides robust IP and invention rights protection through Remote IP Guard, Remote’s system for international IP protection. As a global employment solutions provider, Remote helps businesses protect IP across dozens of countries from internal and external risks.

Start hiring remote software engineers to grow your business

Hiring remote software developers can seem daunting. First, commit to improving your team — then partner with experts for legal, social, compliance and payroll support, either via an EOR or through your own local partners.

Expect hurdles along the way. Persist, gather resources, and you’ll find that hiring the right developers to diversify your team and expertise will significantly boost your company’s capacity to innovate.

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

Remote offers the tools and flexibility to fill gaps and provide protection where you need it most. Contact our global team if you would like more information on how to get started hiring and paying remote software developers.