What is a Global Employment Company?
The GEC is a legal entity (a wholly-owned subsidiary of a group), which employs international assignees who are deployed on various international assignments. Therefore the Assignees are legally employed by the GEC and deployed to the overseas subsidiaries. The GEC is the legal employer of these assignees and manages many of the activities related to their HR Administration.
Is the GEC a third party provider?
No, the GEC is just another legal entity of the group (or, sometimes, a branch of an existing subsidiary), which is dedicated to employing employees who work across borders. Therefore the employees who are employed by the GEC remain 100% employed by the same organization, although there may be a change in the legal entity employing them.
Why do organisations decide to create a GEC?
When designed and implemented correctly, GECs can deliver many advantages, including:
- Centralisation of administrative processes, support services and technology infrastructure, leading to faster response time and better service quality
- Single point of contact for all Mobility-related processes and queries
- Consolidation of the assignee headcount in a single entity, providing centralisation of data, process consistency, increased visibility, efficiencies and economies of scale
- Better compliance, due to the improved visibility and a consistent implementation of policies and processes
- Better control of costs and risks
- Simplification and mitigation of Permanent Establishment exposure
How can ITX help?
ITX is the world’s undisputed leader in the area of Global Employment Companies. For more than 20 years, ITX has been helping organisations to navigate the entire lifecycle of a GEC, from a simple study to a fully-managed turnkey solution:
- Preliminary Study / Feasibility Assessment: ITX can help you assess the feasibility of a GEC model and identify the potential advantages specific to your organisation, based on an analysis of your policies, processes and assignee demographics (nationalities, home locations, host locations, assignment duration, and other parameters). The outcome of this step is a recommendation in favour or against the setting up of a GEC, together with suggestions regarding the most suitable location for the GEC and the assignee categories that should be within the scope of the GEC.
- Set-up support: If you decide to proceed with the establishment of a GEC, ITX can work with you on the legal incorporation of the new entity, drafting of Employment Contract templates, design of the remuneration structure, as well as mapping the processes for HR, Payroll, Accounting and Finance administration.
- Outsourcing support: ITX can also provide support with many of the HR, Payroll, Accounting and Finance processes, on an outsourced basis. You will retain full control and visibility of your Mobility programs, whilst leveraging some of the world’s best resources with many years of experience in managing Mobility through a GEC. You will also benefit from ITX’s own technology platform, Connected, which allow faster and easier administration. To find out why many organisations outsource their GEC processes to ITX, you can find more information here.
- Ongoing consulting support: Our International Mobility Consulting team is always available to provide support at every step of your GEC journey, or on an ad-hoc basis, if you have specific queries.
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