As one of the world’s most populous countries, with the majority being between 18 and 25 years old, the Pakistani market is home to many well-qualified English-speaking professionals. The country is fast emerging as a preferred jurisdiction for foreign businesses seeking skilled professional remote workforces at relatively more affordable salaries. This trend is increasing as global economic conditions drive businesses to explore more efficient alternatives to establishing a local presence in a jurisdiction through a subsidiary.
Of late, many foreign businesses have shown interest in engaging employers of record (EOR) in Pakistan. These EORs are Pakistani businesses that assume the responsibilities of an employer towards personnel that the foreign business wishes to hire in Pakistan. This arrangement allows the foreign business to avoid the risk and compliance burden associated with directly employing personnel in a jurisdiction, including the performance of HR functions, establishing a local presence and managing payroll. The EOR hires personnel specifically to provide services to foreign businesses. These include individuals and remote teams who are specialists in various subjects, from HR to finance, accounting, customer support, administration, IT support, digital marketing, research and payroll management.
This arrangement allows companies to expand cost-effectively and efficiently while remaining focused on their core business by placing with specialist EORs the responsibility for compliance with jurisdiction-specific regulations surrounding employment, benefits and taxes. Given the rise of remote working, prevailing economic conditions and a large qualified workforce in Pakistan in search of rewarding employment opportunities, we anticipate an increase in foreign businesses looking towards hiring in Pakistan through EORs to meet their strategic expansion and specific talent requirements.
Should you require legal advice on engaging remote workforces, please contact partner Shafaq Rehman today.
Note: This article is not intended to provide legal advice, and no legal or business decision should be based on its content. It is intended to provide information of general interest about current legal issues.
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