When managing international talent, visas and work permits can quickly become a top priority for your People teams – not just because your talent needs them, but also because the rules keep changing year after year.
From the EU to the US, processes, fees, and minimum requirements for different visas keep changing. Few companies can keep up on their own – in fact, nearly half of Global Mobility professionals in our recent study said they outsource immigration and compliance tasks to a third-party vendor to stay on top of demand.
If you’re struggling to get budget approved for this kind of solution, we’ve prepared a quick fact sheet for you to bring to your next meeting – proving just how important this investment in compliance can be for your company, your people, and your bottom line.
The risks of non-compliance
Not handling immigration protocols or employment terms correctly can results in serious consequences, including:
Financial fines
Depending on the type of violation, fines can easily reach thousands per employee. For example, in the UK, businesses convicted of hiring expats without the required employment visa and paperwork will be fined up to £45,000 per violation. In Germany, there are fines of up to €500,000 for illegally employing expats without the right to work in the country. Serial compliance offenders incur much steeper repeat charges, as well as damaging their reputation.
Disrupted investment and funding
Beyond direct fines, compliance issues can catch the eye of potential investors and partners during business deals or funding rounds. Finding issues at crucial points raises red flags that hurt credibility and growth opportunities.
Unknown or undisclosed violations discovered right before major international acquisitions might cause the entire purchase to unravel. No buyer wants to absorb compliance baggage that could spill over post-merger, especially in heavily regulated industries like financial services or healthcare.
Loss of customer trust
Diplomatic issues around foreign worker laws that become public knowledge also spark reputation fallout that impacts consumer trust and public perception.
Social media PR nightmares can unfold after compliance shortcomings around sponsored employment or business travel. This type of backlash creates lasting negative impressions that are difficult to overcome.
It won’t matter if breaking compliance was an honest mistake – what matters is how stakeholders will perceive the error. Consumer backlash, particularly around labor misconduct or foreign recruitment, can and will affect your bottom line. Fast growth abroad means nothing if achieved through breaches.
Finally, share prices and market valuation can also drop after negative compliance-related stories reach the public. Savvy investors become skittish of regulatory scrutiny while analysts downgrade future predictions.
Lost productivity and continuity
Non-compliance takes a major toll on operations when violations force employee departures. Losing key staff abruptly creates a ripple effect of productivity decline and business disruption. Here are just some examples
- Unexpected exits lead to the loss of niche skill sets and knowledge. This causes measurable productivity drains across entire departments or business units. Training replacements can take over a year to regain previous levels of productivity.
- Lost output and sales revenue can persist for months during transitional periods as teams absorb departures and await suitable replacement hires. Unfilled mission-critical positions significantly slow workflows that rely on specialized staff.
- Even once roles are backfilled, months of recruiting, extensive background checks, relocations, and onboarding delay when a new hire can contribute to the team's success.
- It goes without saying that mishandling labor laws can also damage the trust of your current employees. As more and more talent pays attention to companies’ commitment to diversity and inclusion, gross negligence around compliance and immigration topics can seriously damage your reputation as an employer.
The bottom line: non-compliance hurts your bottom line
As compliance missteps undermine funding and productivity, they directly hit your company’s bottom line. With so much at stake, companies managing international talent can’t leave compliance to chance. The risks span from thousands of euros lost in direct fines, to fallout that sets your organization’s trajectory way back.
Centralize with experts like Localyze
Partnering with a dedicated service provider like Localyze assists in:
- Properly vetting overseas candidates for visa eligibility during recruiting.
- Accurately completing complicated visa applications.
- Staying on top of changing immigration regulations across key markets.
- Supplying needed compliance documents.
- Issuing routine audits to identify any existing or upcoming issues.
Companies can then rest easy knowing that growth abroad is backed up by expert immigration guidance. Localyze's experts keep track of policy changes across countries and regions to ensure every visa application is completed correctly the first time, reducing delays and costs over the long run.
