
Ask HN: How do you pay your remote team? - soorajchandran
What tools&#x2F;services do you use your remote team? What does the process look like? Do the employees invoice you first and you make the payment?
======
scrollaway
Employees don't invoice you, you pay them a salary. Contractors invoice you.
If your team is contractors (or you're paying them as contractors for
tax/liability/whatever reason), they invoice you and, if you're in the US, you
should also ask for a tax form (usually a W8 or W9) based on where their tax
residency is.

There's many apps/services to handle your payroll out there. Gusto comes to
mind but I've never used it so I don't know what they're like. Some
accountants / CFO firms also may handle payroll for you for a fee.

But really, I don't know your situation so ask that question to an accountant.
There may be critical details you're not immediately aware of; your accountant
will be.

~~~
soorajchandran
Thanks! How do most companies hire? Employees or contractors? As far as I
researched - most companies hire from outside the US as contractors. And they
file invoices, and you pay the amount for it. Do you know of companies that
hire people from outside the US as employees and keep them on the same
payroll?

~~~
planetburgess
Hiring non U.S.employees on your U.S. payroll is a bad idea. The employee will
have a dual tax nightmare having to reconcile the tax and social security
against their home country regime.

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lol768
Please don't send checks.. I can't think of a more annoying way to get paid!
Regardless of the accounting particulars which have been discussed here,
there's bound to be a much better way of actually paying folks.

~~~
orev
This seems like a silly thing to be annoyed about. Checks don’t have fees like
most other types of electronic payment, and money is money. Why would you be
OK with giving up a certain percentage of your hard-earned money just because
you have to go through the “hassle” of dealing with a piece of paper? Many
banks even accept the check deposit via app now - you don’t even need to go to
the ATM.

Edit: I’m talking about paying/being paid as a contractor/vendor, not as an
employee.

~~~
rando444
Checks are a holdover from the 1800s. They don't have a place in modern
banking.

If the US were willing to put tighter rules around bank transfer fees, it
would be possible to create a European style system where bank to bank
transfers are free, regardless of which bank you're with.

------
JonoBB
Is this a US only question? Are you mixing up employees/contractors with
onsite local? Employees don't invoice you; contractors do.

UK employer here. For payment, I can't think of any way of paying any
employees other than via direct bank transfer. I haven't used a cheque (check
in the US) for _years_ , and certainly never for paying employees in the last
20 years.

Regular international contractors are paid via Transferwise; irregular
contractors are usually paid through PayPal.

~~~
telesilla
I love the ease of Transferwise but I've run tests and a bank wire is cheaper
(we get free wire fees with our business banking service so I'm not including
what might be an extra $30 from your bank).

~~~
_-___________-_
A friend recently needed to move EUR sitting in one of her HSBC accounts to
GBP in another of her HSBC accounts. To get HSBC to do it would have taken "up
to three days", and the exchange rate was abysmal. On my recommendation, she
used TransferWise instead, saved almost £300 on the exchange rate and it moved
within an hour. YMMV, but in UK I've literally never seen big banks be cheaper
than TW.

~~~
iSloth
Had a friend with a similar problem, simply moved the funds via Revolut which
gives you a bank account of the local currency at either side.

~~~
_visgean
this is essentially what transferwise does imho.

------
whalesalad
If your team consist of contractors etc... then they'll likely have their own
invoice and payment process. I use Freshbooks.

One of my clients pays me via wire transfer, another does checks, and finally
I have one project via moonlightwork.com (awesome service) where they actually
handle payments (weekly!) which is pretty cool.

If these are actual W2 full-time employees, I would suggest something like
gusto.com to give them direct deposit.

~~~
soorajchandran
Might be a silly question. But do you leave the burden ( may be not really )
of the whole invoice management process on the contractor - how good/bad is
it?

~~~
scalesolved
Would you compensate them either with time or money for it? I think think if
you know it'll take 'employees' that are contractors a certain amount of time
and expenses each month then offering something small in exchange for
(covering accounting fees etc) is a great way to go about it.

------
planetburgess
We have just over twenty remote workers internally and we use a mix. Full
disclosure we are a service provider in this space, so I am just taking about
what we do internally and freely admit I am biased because of the nature of
our business. 1) For short term we engage some folks as independent
contractors. They sign a freelance contract, they invoice us each month for
their gross earnings and we pay them via international wire transfer. Tax and
social security is their responsibility under the contract. We have some
contractors who have been on this arrangement more than twelve months and we
will try to move them onto employee status this year because of the risk of
misclassification. For many tax and labor authorities the contract doesn't
matter if they view it as an employment relationship. 2) If we have our own
entity incorporated in the country where the worker is (UK, Australia) they
sign an employment contract and we pay them through the payroll with full tax
and social security contributions & deductions. 3) Where we haven't got our
own entity or don't want to run our own payroll yet (USA, Spain, etc) we use a
GEO/Employer of record service. The employee signs an employment contract with
the GEO, the GEO invoices us each month for salary + employer costs + their
fees, we pay them and they pay the employee. If you are small or just
starting, begin with the first option. It's by far the easiest to administer.
Eventually as you get bigger and more stable then you will come to a point
contracting alone doesn't work anymore. Then the blended approach has worked
very well for us.

------
celestialcheese
Gusto is great - they have handled all our payroll and contractor payments for
our remote team extremely well.

------
bendauphinee
As a contractor I've been paid by cheque, PayPal, and (my favorite) wire
transfer. Always this was after sending them an invoice. I found PayPal to be
the least friction about invoicing and reminding about due payments, though I
lost between 2-3% of my invoice to fees.

~~~
soorajchandran
Thanks!

------
tomislav
I work remotely from Europe for a US company. Even though the company
considers me an "employee" with all the perks (vacation, health insurance,
etc.) I found that the easiest and best way is for me to form my own LLC,
employ myself in it and invoice the US company for the gross amount. Mostly
because of lower taxes, easier handling of our national health care and
retirement fund, expensing equipment and operational costs.

~~~
stephenr
Great, you’re a contractor.

The “easiest” way for you would be if the company setup a presence there and
you worked for it.

------
wesleyfsmith
We use cryptocurrencies, works super well. Typically ETH and BTC.

------
dininski
I've worked from home (if that qualifies as remote) and was on a salary, paid
directly to my back account with health, pension benefits, etc, handled by the
company. Worked as a contractor for a couple of companies and have been paid
using wire transfer and PayPal. My personal preference is wire transfer as
it's much easier to handle taxes and usually has the least amount of fees and
better exchange rates.

------
FanaHOVA
Deel came out of the last YC batch.
[https://www.letsdeel.com/](https://www.letsdeel.com/)

~~~
soorajchandran
I already came across deal - isn't this exclusively for contractors? If I want
to keep a "company culture" \- but the employees are hired as contractors -
does this work well?

------
echlebek
I work for a remote-only company. We use payworks.ca in Canada, and I believe
ADP in the USA, for direct deposits.

------
akulbe
For the US-based folks on this thread, I think the don't-pay-me-with-checks is
mostly a non-starter.

4 of the last 5 banks I dealt with now let you do mobile deposit, where you
can endorse the check and deposit it into your bank account by taking pictures
of the check with your smartphone.

¯\\_(ツ)_/¯

~~~
stephenr
The extent the US will go to, to avoid just moving on and adopting electronic
transfers like ever other developed nation is astounding.

------
kvee
Used to use [https://www.bitwage.com/](https://www.bitwage.com/) but fees were
too high so switched to [https://husky.io/](https://husky.io/)

------
AndrewKemendo
I'm confused by the question because your processes should be in place to pay
your people no matter where they are.

That means you need to have registered as a foreign corporation wherever they
are working, filed the W9s, W2s and 1099s so that they pay taxes correctly.

If you don't have a payroll processing company or an accountant (don't use
ADP) to make sure you're perfectly covered then you should get one ASAP. There
aren't too many faster ways to get shut down than to have a state or federal
tax agency come hunting you down.

------
mac01021
Then startup I worked for used Gusto and then later Sequoia One for payroll.

I'd be interested to know what the big remote companies like Elastic do.

~~~
soorajchandran
But Gusto only works inside the US right? What if the company is located in US
and contractors are outside the US?

~~~
xtracto
One way it works is by contracting a company that employs your people outside.

In Mexico there are several companies that do that, beware that they usually
charge a % of _everything_ you do: Not only salaries, but refunds or any other
money movement you want to make.

------
nodesocket
To pay contractors I use Square payroll. Pays out to ACH bank accounts (US
only) and handles sending 1099's. $5 per contractor per month.

For full time employees look at using Gusto
([https://gusto.com/r/MqwBf/?utm_source=reflink](https://gusto.com/r/MqwBf/?utm_source=reflink)).
Note: That's a promo link, we each get $100 Amazon gift card when you sign up
and run a payroll.

------
iEchoic
We've been very happy with Gusto for payroll + benefits for our salaried
remote team.

~~~
soorajchandran
Outside US too?

------
kanwisher
Transferwise, just regular payments twice a month, no need for an invoice
every time

~~~
stephenr
If you’re sending money offshore without an invoice how exactly do you account
for that?

------
wmab
We hire a number of folks both as traditional contractors as well as
freelancers. Here's some thoughts based on my experience:

1) Are they an employee or a contractor? You mention "employees" but talk
about them invoicing you. If they are requesting payment via invoice then it
sounds like a contractor. It's very important that you define this
relationship early on. There are different rules for both (health insurance,
paid time off, taxes owed and by who) that are handled very differently. You
might have seen a lot in the press about Uber / Lyft etc handling their
drivers as contractors and a lot of these reasons are the reason why. So if
you're deeming them as contractors (1099s) then make sure you have a contract
that makes this explicit. You can find good templates from places like
Upcounsel[1], but make sure you have a lawyer take a look.

2) I spoke with the founders of Deel[2] (YC W19) just last week. Their value
proposition is that they'll handle the contracts, paperwork and payments
(according to your payment schedule) for a small fee (I think
$10/m/contractor). This seems like a very good value prop if you hire more
than 1 or 2, and one I'm looking into.

3) If you have only a few contractors, then creating a standard contract and
making payments to them on submission of their invoice and time sheet (if
hourly) is pretty simple. I request our contractors only send invoices monthly
to limit the admin for me, and then I pay them via Transferwise (they have a
USD-USD beta program that I'm not sure is open to all), because it has cheaper
fees than our bank.

4) Assuming you're using a fully fledged accounting/ payroll service or
otherwise, then lots of these do have a contractor payment part. The payment
part isn't the difficult part, the real benefit of these systems is handling
the paperwork with the government for you. We use a full PEO called
JustWorks[3] which is awesome - you tell them you have a contractor, you're
paying them outside JustWorks and they'll handle all the year end 1099 forms
etc.

5) Freelancers. We hire many freelancers to do work for us via Upwork. It's a
great tool to get things done, and will do all payments/contracts/compliance
for you, for cheap. The downside is the freelancer pays pretty hefty fees,
which go down over time [4]. We pay $25/m for all our freelancers paid through
the system (30+ freelancers), so it works really well for us.

Happy to answer any other questions you may have!

[1] [https://www.upcounsel.com/free-legal-
documents](https://www.upcounsel.com/free-legal-documents) [2]
[https://www.letsdeel.com/](https://www.letsdeel.com/) [3]
[https://justworks.com/features](https://justworks.com/features) [4]
[https://www.upwork.com/i/how-it-
works/freelancer/](https://www.upwork.com/i/how-it-works/freelancer/)

~~~
dnh44
CurrencyFair.com does USD to USD transfers and I’ve found them to be very good
for the nearly ten years I’ve used them.

------
djbelieny
Check out Veem.com

~~~
overcast
What a poor choice in naming a tech company.

------
brudgers
Check, envelope, and stamp is the simplest thing that might work.

~~~
dnh44
checks don’t cross international borders cheaply. If I remember correctly from
the last time I tried Barclays in the UK charged about £50 to deposit a USD
check from a US bank.

~~~
brudgers
_£50_ a month is £600/year. Rounding error on a going concern. Rounding error
on a developer's rate. And worth less than the time an entrepreneur would
probably spend trying to save half of it. Moving money internationally will
always cost something. Exchange rates might eat more of a developer's salary.

~~~
dnh44
It’s £50 a month in addition to getting ripped off on the exchange by the
bank. Using a service like CurrencyFair or Transferwise would save someone
thousands a year. There is also the hassle of having to physically deposit the
check.

Also checks in general have gone the way of the fax here. I’ve seen only one
in the last fifteen years. I would be surprised if people in their 20’s have
never seen one.

------
knocte
gitcoin

------
charlesdm
Most remote workers are independent contractors, and they generally invoice
you.

~~~
soorajchandran
And what tools are used to pay the invoices?

~~~
brudgers
Checks or electronic equivalent.

There's a scale at which more complex tools may make sense. That scale varies
with the variation in the details of a company's operation. For a few
contractors the overhead of learning and integrating a tool may outweigh the
actual (not perceived) benefits.

Most of the work is reviewing invoices, not writing checks.

------
ramijames
We use cryptocurrencies. Fast. Free. Immutable and provable.

This is 2019 guys. Get with the program.

~~~
_eht
How does your accounting work? Is your accountant also up to date with the
2019 program?

Are there any caveats to this that you didn't mention? Are they all contract
1099? What about healthcare and retirement contributions and considerations?

~~~
knocte
I never understand why people bring up accountants or taxes when talking about
cryptocurrencies. Seriously, you negotiate with your employer an hourly rate,
you get paid that hourly rate and is what you should report.

The way you receive your salary at the end of the day (bank transfer or
crypto) is completely decoupled from this. In the same way you don't need to
tell the taxman what bank did you use to receive your wage, you don't need to
tell what cryptocurrency you used (if you don't convert instantly to fiat when
receiving it, that will mean you will have more taxable events later, but this
is another subject).

~~~
apazzolini
How is converting it to fiat a different subject when most people need to be
paid in something that can then be used for rent/food/literally everything
else?

This entire thread is insane.

The second a job tries to pay me in crypto is the second I'm looking for
another job.

~~~
phonebanshee
Depends on the amount of money involved, doesn't it? I don't care how you pay
me, as long as the amounts involved make it worth my time.

