North America consists of the Bahamas, Canada, the Dominican Republic, Jamaica, and the United States. If you wish to expand into a neighboring North American country, the proximity and resources available are a definite benefit. Often, this type of expansion is one of the most attainable.
US-based companies can expand into neighboring countries in this region of the world without having to set up a subsidiary or local company presence if they work with Globalization Partners. As your North American PEO we become your employer of record in the desired country and provide the infrastructure to manage international staff via our solution.
Expanding into North America
Expanding into North America is in some ways easier than trying to operate in another country. The United States, Mexico, and Canada have had free trade deals in place for more than twenty years, and there are tax treaties in place between these countries with closely integrated supply chains.
However, in other ways, expanding into North America is a challenge. The new free trade deal, the United States-Mexico-Canada Agreement (USMCA), had not been ratified as of summer 2019. In addition, the current U.S. administration (elected in 2016) imposed tariffs, which created some trade tensions.
With our platform, you can start hiring in a new country and enter an untapped market in a matter of days. Globalization Partners manages the administrative burden and through a service agreement, allowing your employees to work and report to you just like your current employees
North America Employment Law and Compliance
Provinces or territories determine Canada’s employment laws. These laws differ depending on where an employee lives. In Mexico, labor laws are codified in the Mexican Federal Labor Law (FLL), while laws in the Bahamas allow oral or written employment contracts.
Hiring and Work Permits in North America
To do business in the Bahamas without being a citizen or permanent resident, employers and investors need approval from the Bahamas Investment Authority (BIA). Expedited work authorization is allowed to Mexican and Canadian workers through a program called TN status under NAFTA (the North American Free Trade agreement, the predecessor to the UMSCA). The UMSCA kept this status largely intact.
In the Bahamas, non-residents may need to apply for a visa and work permit from the Department of Immigration. In Jamaica, some employees may need a permit from the Jamaican Work Permit Department of the Ministry of Labour and Social Security (MLSS).
Compensation and Payroll in North America
The minimum hourly wage in Mexico was U.S. $4.87 or 88.36 pesos in 2018. In Canada, minimum hourly wage varies by province or territory, from $11.32 (October 2019) in Saskatchewan to $15.00 (October 2018) in Alberta.
In 2018, the Bahamas minimum wage was B$5.25 per hour while the Dominican Republic’s minimum wage was 8,310 Dominican pesos a month. Jamaican had a monthly minimum wage of J$7,000 in 2018.
North America and GDPR
The European Union’s General Data Protection Regulation (GDPR) placed strict new rules in regards to personal data as of May 2018. Companies offering services or business to European customers must comply with these rules, which require greater transparency about what data you gather and how you use it.
North America GDPR compliance is important even though no North American countries are part of the European Union (EU). North American countries widely speak French, Spanish, and English, so companies’ websites can easily expand to offer services and products to European customers. Once they do, compliance with the GDPR is critical to avoid hefty penalties.
Data Privacy in North America
In North America, the USMCA limits data localization policies and prohibits restrictions on cross-border data transfers. The agreement also requires countries to keep anti-spam regulations and online consumer protection laws in place.
The Bahamas has an Office of the Data Protection Commissioner, charged with keeping private information safe. In 2019, Jamaica sought to pass the Data Protection Bill and Information and Communications Technology (ICT) Act to offer more data protection. Under Section 44 of the Dominican Constitution, citizens have a right to access to the information stored about them.
How Global PEOs Help Companies Expand into North America
With a PEO, you do not need to learn labor laws, data privacy regulations, payroll deductions, and other rules when you want to expand into North America. Are you wondering whether North America data privacy laws cover your website or whether you need a permit for your new employee?
Globalization Partners frees you from these concerns so you can focus on your company. With us as your PEO, you can hire across borders without opening foreign offices or worrying about compliance. You can attract the best candidates and expand your market reach while we support you with the regulatory details.
Talk to a North American PEO Expert
If you’d like to expand into North America easily and quickly, speak with one of our global expansion experts today. Globalization Partners will ensure you are compliant, disperse payroll accurately, and adhere to local tax law.