Independent contractors or freelancers are self-employed individuals who provide services to companies as a non-employee. This is one of the most common ways companies tend to hire non-local designers, engineers, support reps, etc.
For legal and tax purposes, independent contractors are not classified as employees. They may work for multiple clients, set their own work hours, negotiate their pay rate, and decide how a job gets done.
For example, the IRS says that if an independent contractor or freelancer does work that can be controlled (what will be done and how it will be done) by an employer then they are, in fact, classified as an employee.
As you can imagine, hiring someone as an independent contractor versus an employee is a fine line to tread.
While there are benefits when you choose the contractor route, there are quite a few drawbacks to consider and you’ll need to weigh them carefully to determine the best fit for your company.
A foreign subsidiary is a company that operates overseas as part of a larger company who’s HQ is in another country.
Establishing a foreign entity is great for having an international presence and accessing new markets. Though, setting up a subsidiary in Botswana can be expensive, stressful, and time-consuming. It's not for the faint of heart.
To set up a subsidiary in Botswana, you have to:
If you're lucky, this process can take months. If you're not so lucky, it can take up to a year. And on average, it costs about $50k-$80k, all-in-all, to get setup. And that's just for Botswana.
An employer-of-record (EOR) is a company that hires and pays an employee on behalf of another company.
An EOR is typically used to overcome the financial and regulatory hurdles that often come with employing remote workers.
Each country has its own payroll, employment, and work permit requirements for non-resident companies doing business in their jurisdiction. Meeting those demands can be a huge obstacle when it comes to hiring remotely.
At Panther, we help companies employ and pay people in over 160 countries, without having to set up a foreign subsidiary. Payroll, benefits, taxes, compliance, and more are all handled by us, at a fraction of the cost.
Outside of saving you months and tens of thousands of dollars, other advantages of using Panther are:
Because you no longer have to set up your own subsidiary, you’ll save a ton of time and tens of thousands of dollars using Panther.
Paying employees in Botswana is not the same as paying workers in your own country. Employees have to be paid using Botswana’s employment and payroll standards.
This means that you have to know, understand, and keep up with 1) fluctuating currency changes, and 2) local payroll and tax laws in the countries you’re looking to hire in.
Outside of the laws and regulations around payroll, there may be different conditions surrounding leave, overtime, termination, and more. As you can imagine, maintaining this kind of regulatory knowledge can be challenging. But it is crucial and necessary to follow local legislation.
After, you’ll have to determine the best way to pay your international employees. This can be done in a number of ways, including but not limited to:
One of the most challenging (and expensive) parts of paying international employees is setting up the infrastructure to do so.
Before you start to run payroll, you have to register your company as the local employer in the country the worker resides in. As you can see in the “Set up a subsidiary” section, this is a multi-step process that can take up to a year and put you on your way to bankruptcy.
Outside of EORs acting as the full admin employer, many also provide remote payroll.
For example, at Panther, in just 1-click, you’re able to pay your entire global team, anywhere in the world. We send you an invoice each month, charge you in US Dollars, and pay your employees the same amount in their local currency.
We factor in currency fluctuations and use the mid-market rate plus any applicable fee passed on by our provider at cost at the time of billing.
The standard working hours in Botswana is 40 hours over 5 or 6 days.
In Botswana , any work beyond 48 hours is considered overtime for which employees receive extra pay.
For work over public holidays or weekends, rest time accounts for 200% of the normal pay.
Employees are paid on a monthly basis pay falls in different dates of the second half of the month. Pay day usually ranges from the 15th of the month to the last day.
In Botswana, employers are not required to pay employees bonuses but may elect to do so as part of their compensation package.
Employees must take eight vacation days within six months of accrual. The remaining days can be accumulated for up to three years.
Employees receive 15 days of paid leave each year.
An employee is entitled to receive annual leave pay of a minimum of 1.25 days for every month. Annual leave does not increase with the employment length with the employer.
There are 10 public holidays. If a public holidays falls on Sunday, it will be observed the following Monday.
The employee must inform the employer as soon as possible if they are absent from work for more than 24 hours. Employees receive up to 14 days of paid sick leave with a doctor’s certificate.
In Botswana, six weeks of maternity leave is taken before the expected due date and the remaining is taken after the birth. Female employees are entitled to 12 weeks of maternity leave.
There is no statutory paternity leave.
There is no statutory paternity leave.
Employers generally can terminate an employment contract by providing written notice to the employee.
The notice period is equivalent to the pay period of the employee. If the employee is paid monthly, then the notice period is one month. If the employee is paid weekly, then the notice period is one week.
No notice is required if the employee is dismissed for misconduct or poor performance.
Severance pay after 60 consecutive months of employment. This is calculated as a day of pay for each month served up to 60 months, and then two days for every further month.
Probation period is 3 months for unskilled workers and may extend up to 12 months.