Global Employment Companies 2025/26 Insight series

Global Employment Companies (GECs) are not new, and have been utilised for decades, with their ‘popularity’ fluctuating over time. Originally GECs were often utilised to effectively handle the employment of global nomads who moved regularly from country to country, or to benefit from the tax and social security regimes applicable to offshore employment (particularly in the Energy and Resources sector).  In response to the competitive talent environment, organisations focusing on developing their talent deployment strategies, global shifts in remote work technology and attitudes (which have made remote working more accessible than ever), and regulatory changes, we have seen over the past three years a period of increased activity. Many organisations are now considering whether a GEC entity offers a potential solution to global workforce employment for populations of employees, either by implementing a new GEC model or expanding the use of an existing GEC.

The importance of GEC location analysis

Selecting the most appropriate location for a GEC is an important part of the due diligence process for implementing a GEC and the review must be multi disciplinary in nature, covering all key business functions. As well as reviewing key tax aspects (including corporate tax, ability to establish and maintain corporate tax residence, transfer pricing, indirect tax, and employment taxes), there are several other significant areas which should be onsidered such as employment law, regulatory considerations, and corporate governance:

Historically, the location of a proposed GEC was often closely linked with potential tax and social security benefits, with many GECs located in low or no tax jurisdictions. However, due to changes over time in regulations and the introduction in several locations of economic substance requirements (e.g. the Middle East and Channel Islands) we have see a shift towards organisations prioritising countries with:

Stability

• Established tax and corporate governance regimes
• High political and economic stability

Substance

• Where a degree of business substance is already in place to benefit from knowledge and expertise in that country, potentially resulting in lower set up costs

Favourable treatments across key business functions

• For example, ability to manage individuals employed in that location but not working there – including benign employment laws and strong treaty networks 

There are still benefits and limitations to each of the identified locations and differing requirements and compliance obligations across the key workstreams need to be weighed up and compared for each respective location as part of a location analysis. Consideration should be given to risk mitigation and always ensuring that the business’s strategic objectives are at the forefront of decision making.

Within our report we include several example questions to be answered for each GEC location under consideration across the key business functions such as the different tax areas, employment law and corporate governance. Additionally, we provide an example for the employment tax and social security considerations when we previously assessed Portugal as a potential GEC location.

It is important to ensure relevant senior stakeholders across the key business functions are involved in the decision-making process to be certain that no area(s) which could have critical implications are overlooked. Decisions should be documented as part of the project’s sign off and governance process for future reference.

Please access our report for these additional insights.