How to Pay Your Global Talent

This week, I want to excerpt a wonderful piece our team at Sagan wrote about “Paying Global Talent.”

There are a range of options in the global payments space, and the below represents our experience with a bunch of different options.

This stuff is constantly evolving, and we are tracking new options every month.

One of the reasons I want to explain this, is “payments confusion” is a way that the staffing markup agencies bamboozle you into paying them their middleman fee in perpetuity.

“We take care of all the payments for you!!!”

Dude, it takes like 10 minutes to setup an account - you want me to pay you $2,000 a month in markup for that?

Be confused no longer - use one of these platforms, and make those jabronis go get real jobs (or come work for us at Sagan!)

Paying global talent can be done through various services, each with its own benefits and considerations.

Some widely known services include Wise.com, Payoneer.com, and PayPal.com.

Additionally, standard bank ACH or wire transfers are options.

The best service depends on the country your global talent is from.

Key Considerations:

1. Fees: Determine who will cover the fees. Some services offer choices.

2. Charges: Understand if the service charges a percentage or a fixed fee.

3. Transfer Time: Consider how long it takes for the global talent to receive funds after payment.

Establishing Your Payment Policy

When paying global talent, establish a clear policy:

1. Payment Frequency: Decide whether to pay weekly, bi-weekly, or monthly.

2. Arrears: Find a balance that allows processing time while considering the talent's financial needs.

3. Additional Benefits: Consider offering benefits like health care, even for contractors.

4. Time Off Policy: Define the holidays you recognize and the policy for time off.

Sagan's Payment Policy

• Payment Schedule: We pay every two weeks through Deel. Some talent is paid monthly.

• Invoices: Global talent must submit invoices with hours and rates.

• Flexibility: Deel allows flexibility with payment schedules.

• Health Insurance: Reimbursements are offered after 90 days, varying by location.

• PTO and Sick Days: We offer 10 days PTO and 5 sick days. PTO is not accrued, and additional PTO can be negotiated based on seniority. Long-term members may have unlimited PTO.

Payment Portals

Different platforms offer various pros and cons. The choice depends on exchange rates, speed of disbursement, service locations, and ease of setup.

Wise.com

• Supporting Countries: Does not support Venezuela, Nigeria, Nicaragua.

• Pros: Easy to set up and transfer funds. Works well with most countries. 

• Cons: Fund transfer delays can occur depending on the bank. 

For example, with Bank of America (BOFA), transfers are same-day, but with Mercury, it takes 3-4 business days. To manage this, we transfer funds from our bank account into Wise 4 business days ahead of payroll.

Once the funds are in the Wise account, money is transferred the same day to our global talent once we pay them.

There are exceptions where it takes one business day, usually due to the specific bank used by the global talent, not Wise.

Payoneer.com

• Pros: Works well with most locations.

• Cons: Transfer fee up to 3.5%.

Revolut

• Pros: Easy setup and transfer.

• Cons: Lower exchange rates compared to other platforms.

Deel

• Cost: $49 per month per contractor, with discounts at volume.

• Pros: Payroll processing is easy. Robust platform. Allows flexibility. 

• Cons: Funds are received 7 days after the pay date. Early withdrawal option available for about $15.

• EOR Pricing: $299 to $599 per month plus government fees and salary, with a 1-2 month refundable deposit. Pricing is negotiable based on volume.

Thera

Around $10 per user per month. Cheaper than Deel and recommended by members.

EOR Pricing: Starts $199 per employee per month. They are new - TBD on quality and finer details.

Remitly

• Pros: Quick transfers.

• Cons: Varying fees and exchange rates. Example: $1.99 for bank deposits to the Philippines.

• Can send money to Nigeria. 

PayPal.com

• Pros: Easy fund transfer.

• Cons: Transaction fees up to 2.99%, additional fixed fees for local account transfers, and exchange rate differences. Not recommended for long-term team members.

• Not recommended for LatAm locations due to exorbitant local fees. 

Exchange Rate Comparison

• Remitly: 440 USD = 24,358.4 PHP

• Wise: 440 USD = 24,744.4 PHP

• Google: 440 USD = 24,983 PHP

Insights from Sagan Members

Plane.com (formerly Pilot)

• Pros: Handles W8-BEN collection, country-specific contractor contracts, and ACH setup. Costs $29 per active contractor per month.

Bill.com

• Pros: Useful for payments to various vendors.

• Cons: Does not send money to Nigeria. 

Payments to Argentina

Local fees in Argentina tend to be expensive, adding $15-$25 per transaction on top of standard service fees.

Additional Notes

Many global talent members may have a US-based account with larger international banks, providing a USD account.

This overview should help you choose the right payment method and establish a clear payment policy for your global talent.

———————

Yallah Habibi,

Jon

Passage of the Week:

The Autumn Wind is a pirate

Blustering in from sea,

With a rollicking song, he sweeps along,

Swaggering boisterously.

His face is weather beaten.

He wears a hooded sash,

With a silver hat about his head,

And a bristling black mustache.

He growls as he storms the country,

A villain big and bold.

And the trees all shake and quiver and quake,

As he robs them of their gold.

The Autumn Wind is a Raider,

Pillaging just for fun.

He'll knock you 'round and upside down,

And laugh when he's conquered and won.