United States PEO

Hiring in the United States

Thanks to its widely acclaimed higher education system and a marketplace driven by innovation, the United States of America offers a wealth of talent that can benefit organizations. However, hiring American workers can be complicated due to a web of laws at the federal, state, and even municipal levels.

Monitoring and adapting to changes in US labor laws is a time-consuming but necessary task, given the consequences of noncompliance. Beyond that, it’s important to be familiar with salary and wage benchmarks and the benefits provided in different sectors. An employer of record (EOR) can make hiring and paying employees in the US easier.

Relying on an employer of record (EOR) in the US

Because of its in-country presence, the EOR can employ the workers a company needs and lease them to that company, taking care to comply with US labor laws. As a result, the organization doesn’t have to establish a legal presence or manage compliance in the US.

The EOR can hire and onboard employees in as little as two weeks and manage ongoing responsibilities such as payroll, benefits, and taxes. A full-service EOR can also manage recruitment. Together, these EOR services significantly reduce the administrative burden for an organization.

Visit our employer of record services page to learn how we can help you meet your international employment needs in the US.

Doing business in United States

Global PEO Services (GPS) helps companies hire employees in the United States without establishing a legal entity. All human resources, benefits, payroll, and tax needs for the employees are managed by the Global PEO, while the new hires and headquarter teams focus on your business goals.

When hiring employees in the United States, establishing a subsidiary or branch office is not always the best route, as it’s often a lengthy and expensive process. Hiring via a Professional Employer Organization (PEO), or Employer of Record (EOR), is a faster and often more effective option – especially when starting up in a new country.

Global PEO Services hires the employees on your behalf, legally contracting them through our subsidiary in accordance with the US labor laws. As a result, the burden of compliance is on us and the employees can begin work for your company in a matter of days. PEOs/EORs provide you with a streamlined option for hiring employees, testing markets, and responding to growing business needs in the United States. With Global PEO Services, you get control without taking on legal entity liabilities, contractor risks, or sacrificing on talent or speed to market.

Country Overview

Bordered by two nations, Mexico and Canada, the United States is an economic, military, and technological powerhouse. The country has a diverse range of natural minerals, including the world’s largest coal reserves.

Capital City

Washington, D.C. (District of Columbia)

Currency

US Dollar (USD)

Language

English

Government

Constitutional Federal Republic

In the United States, an employment contract can be either in writing or verbal.

Some of the details typically mentioned in the written contract include:

Performance assessments
Deductions
Expenses
Sickness & disability
and more

The different types of employment relationships are:

Permanent Employment – Most employees in the United States are presumed to work at will.
Fixed-Term Contracts – The maximum duration of fixed-term contracts in the United States is not documented in labor law (including renewals).
Temporary Employment – Temporary employees, also known as “temps,” are employed in the United States for a set period. They are usually hired to fill temporary vacancies or to fill other gaps in the organization’s workforce. They may work part-time or full-time hours and are not typically eligible for employee benefits.

Probationary Period

In the United States, a probationary period typically lasts up to 90 days.

Work/Time Regulations

The standard workweek in the United States is 40 hours, according to the law.

Leave

Employees in the United States are entitled to the following leave:

Annual leave – The Fair Labor Standards Act (FLSA) of the United States does not require payment for time not worked, such as vacations, sick leave, or federal or other holidays. Employers decide how much vacation to provide and to whom.
Maternity leave – The federal law of the United States is unique in that it does not provide cash benefits to women while on maternity leave. In the absence of federal legislation mandating paid maternity leave, several states have enacted legislation to compensate new parents.
Sick leave – There are no federal legal requirements for paid sick leave in the United States. Unpaid sick leave is required by the Family and Medical Leave Act (FMLA), and organizations subject to the FMLA must provide it.
Paternity leave – The federal Family and Medical Leave Act (FMLA) guarantees 12 weeks of unpaid paternity leave in the United States. The right to FMLA leave for birth and bonding of a child expires 12 months after the date of birth.

Public Holidays

The following are the statutory national holidays observed in the United States:

January 1 – New Year’s Day
January 18 – Martin Luther King Jr. Day
January 20 – Inauguration Day
February 15 – Presidents Day
May 31 – Memorial Day
June 18 – Day off for Juneteenth
June 19 – Juneteenth
July 4 – Independence Day
July 5 – Independence Day observed
September 6 – Labor Day
October 11 – Columbus Day
November 11 – Veterans Day
November 25 – Thanksgiving Day
December 24 – Day off for Christmas Day
December 25 – Christmas Day
December 31 – Day off for New Year’s Day

Benefits

In the United States, the usual forms of social insurance are Social Security, Medicare, and Unemployment Insurance.

There are two types of compulsory Social Security plans for employees in the United States:

The Old-Age, Survivors, and Disability Insurance (OASDI) Program
The Supplemental Security Income (SSI) Program.

The United States government program incorporates public funds to provide economic security to the general public. There are 4 main types of benefits that the U.S. Social Security Administration (SSA) offers:

Retirements benefits
Disability benefits
Benefits for spouses or other survivors of a family member who has passed
Supplemental Security Income (SSI)

Some examples of social insurance programs are:

Dependents/Survivors Benefit – In the United States, Old-Age, Survivors, and Disability Insurance (OASDI) provides survivors benefits to family members of a deceased insured member who was under the age of 62 and had at least 6 quarters of coverage. Eligible survivors include the deceased’s spouse, children, and parents.
Life and Disability Insurance/Benefit – In the United States, disability benefits are distributed through two programs:
- The Social Security disability insurance program, known as Old-Age, Survivors, and Disability Insurance (OASDI), provides pensions to employees who meet the age-based insurance coverage requirement.
- The Supplemental Security Income (SSI) program assists disabled adults and children with limited income and resources.

The other statutory allowances are:

Unemployment
Birth allowance
and more

Termination

In the United States employees, generally, do not have contracts and are hired at will. However, if an employment contract exists, the parties can negotiate contract terms governing notification procedures.

Visa/ Work Permits

There are typically the following types of visas:

Temporary Visas
- B-1/B-2 Tourist/Visitor Visas
- E-1/E-2 Treaty and Investor Visas
- F-1 and M-1 Student Visas
- H-1B Specialty Occupation (Professionals) Visas
- J-1 and Q-1 Exchange Visitor Visas
- K-1 Fiancé(e) Visas
- L-1 Intracompany Transfer Visas
- O-1 Extraordinary Ability Worker Visas
- P-1 Artists and Athletes Visas
- R-1 Religious Worker Visas
- TC and TN NAFTA and US-Canada Free Trade Agreement Visas

Permanent Residency (Green Cards)
- Family-Sponsored Immigration Visas
- Employer-Sponsored Immigrant Visas:
  - EB-1 Foreign Nationals of Extraordinary Ability, Outstanding Professors/Researchers, and Multinational Executives/Managers
  - EB-2 Workers with Advanced Degrees or Exceptional Ability in the Arts, Sciences, or Business
  - EB-3 Skilled Workers and Professionals
  - EB-4 Special Immigrant Visas for Religious Workers
  - EB-5 Investor/Employment Creation Visas
- DV-1 Visas (the “Green Card Lottery”)

Other Categories
- Refugee and Asylum Applications
- Temporary Protected Status

The payroll frequency is typically bimonthly unless stated otherwise in the contract.

Accounting

Accounting standards must adhere to the U.S. Generally Accepted Accounting Principles (GAAP) for publicly traded companies. However, in the U.S. SEC filings, foreign SEC registrants may use International Financial Reporting Standards (IFRS).

Taxes

Corporate Tax

The standard corporate tax rate is 21%.

Value Added Tax (VAT)

The U.S. does not levy a VAT.

Filing Dates

A corporation must typically file its income tax return by the 15th day of the 4th month following the end of its taxable year for taxable years beginning after December 31, 2015.

For corporate filers with a calendar year-end, the due date of the tax return (without extension) is 15 April.

Penalties

The United States tax rule provides a comprehensive set of penalties and interest regulations for failing to pay and failing to file, with relevant amounts typically determined based on the specific form or tax code section at issue.

While the Supreme Court has interpreted the Constitution to grant individuals the right to privacy, several federal laws have been passed to give statutory protections for people’s personal information in the U.S.

The U.S. federal government, specifically the U.S. Department of Justice (DOJ) and the Federal Bureau of Investigation (FBI) play a unique role in combating public corruption in the United States.

18 USC Section 201 is the key provision that expressly criminalizes the corruption of U.S. federal public officers. The two main subparts of the act are:

Section 201(b) – criminalizes bribery
Section 201(c) – forbids the payment or acceptance of gratuities

Penalties typically include imprisonment, a monetary fine of US$250,000, or both, or triple the value of the bribe, whichever is greater.

With our Global PEO/Employer of Record services, companies can expand into the United States and hire their employees without having to establish a branch office or subsidiary in the United States.

Your candidate is hired via our United States PEO. If needed, we can also help you find the right talent in any country with our comprehensive global staffing services.
Your new employee begins work quickly as we take care of employment contracts, statutory and non-statutory benefits, and running their payroll – all in full compliance with the United States laws.
Global PEO Services experts manage all day-to-day operational issues such as employee expenses, and severance/termination if required.
With no contractor risks, pass on the compliance burden to Global PEO Services.

Spin Off/M&A Support

Ensure continuity of payroll, benefits, and HR support when acquiring or spinning off a business with employees overseas.

24/7 Support in 150+ Countries

Empower your teams with 24/7 support and a single point-of-contact model in which experienced client services directors are in continuous communication with information and advice.
We are backed by a mix of 300+ multidisciplinary experts from HR, Payroll, Finance, Tax, and Legal domains who are ready to respond to the expected and unexpected needs of your business on the shortest notice.

Easy Visibility into Your Employee Time & Attendance and Benefits Data
With our Global PEO, you get access to Mihi, our proprietary SaaS solution for time and attendance, vacation, leave management, and benefits enrollment and management. Mihi enables clients to have easy access to employee data in real-time. It is designed specifically for companies with a global workforce, especially when working in multiple countries with a low headcount.

Ready for Growth When You Are
When ready, we can seamlessly transition you from the PEO/EOR model to your own legal entity and provide ongoing international HR, finance, legal, compliance, and staffing support. Learn more about our end-to-end international expansion services.

Contact Us

Ready to hire in United States?

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Payroll & PEO in United States

United States Payroll Outsourcing & Management Services

Hire and pay employees in United States without setting up a legal entity. With our United States payroll and PEO services, you select the candidate, and we handle the rest.

After successfully hiring and onboarding your employees, we manage all aspects of the payroll process, ensuring your employees are always paid accurately and on time.

Our United States payroll experts have an in-depth understanding of local payroll requirements and provide you with in-depth guidance and compliance support.

Our United States PEO Payroll Solutions Cover:

Struggling to Manage Payroll for Independent Contractors?

Global PEO Services eliminates the complexity and liabilities associated with employing and paying independent contractors. We allow you to hire your contractors as employees through our United States PEO. The individual continues to work for you, while we manage all aspects of payroll, HR, tax, and compliance.

The Solution to Low Headcount Payroll

Finding a payroll option for countries where you have low headcounts can be a challenge. Global PEO Services provides the solution. By using our United States PEO to manage your payroll, you leverage our pre-existing payroll infrastructure, teams, and processes, even if you only need payroll for just one employee. Stay flexible, save time, all while getting the payroll services and support you need.

Quick facts