How We Helped a Startup with Legal Aspects of Hiring

Legal aspects associated with hiring can be confusing, but with LEGID it doesn’t have to be. Our blog post explains how to hire volunteers and interns, as well as the differences between the two.

As an entrepreneur, it’s important to be aware of the different laws and regulations around hiring. With LEGID, you can easily find qualified legal professionals to help guide you through the process.

Hiring in Different Countries

When you’re hiring in a new country, it’s important to be aware of the different laws and regulations. In some cases, the laws for hiring can be very different from those in your home country.

It’s important to be aware of the laws in the country where you’re hiring, so that you can comply with them and avoid any penalties.

Hiring Volunteers vs Interns

When you’re hiring someone, you need to decide whether you’re hiring them as an employee, volunteer or an intern, for example. There are important distinctions between the last two that you need to be aware of. 

It’s important to understand the differences between volunteers and interns (or trainees) before you hire, as there can be significant legal implications.

We recently worked with a startup that was looking to hire remotely from the US. They were having difficulty understanding the legal implications of hiring in a new country and were unsure of how to proceed.

Contracts related to traineeships are regulated by the Vocational Education Institutions Act, according to which the relationship between a student or his / her legal representative and the person arranging the traineeship is regulated by a contract concluded before the start of the traineeship.

In the event that a person has been in a traineeship with a contract under which the company also pays the trainee a salary, there is a very high probability that in the event of a dispute, the labor dispute committee or the court may consider the concluded contract to be an employment contract.

Therefore, it is even recommended not to pay a salary. According to the explanatory memorandum to the Taxation Act, a person who enables the work is not required to register the traineeship of persons working within the framework of study practice on the basis of the Vocational Education Institutions Act and on the basis of the higher education standard.

In situations where it is unclear whether a contract is for an employment relationship or a traineeship, it is recommended to seek clarification from the Tax Board.

The second option is voluntary work. Volunteering is working on an unpaid voluntary basis. This work is subject to registration with the Tax Board’s employment register.

This difference is due to the need to avoid situations in which informal workers are treated as volunteers by the employers and thus evade the obligation to register, while payments to employed persons are made.

The concept of “employment” is therefore most important in distinguishing between a volunteer and a trainee – a volunteer is a person who comes to work for a company (without being paid for it), but a trainee is a person who comes to a company (without being paid for it) to acquire new knowledge and not for work.

A contract for employment on a voluntary basis is a contract, according to which a volunteer agrees with the organization to perform certain work without receiving financial compensation for it.

With this background in mind, LEGID provided this startup with a consultation on hiring volunteers versus interns and explained the difference in terms of laws. The result was that they were able to hire people free of charge remotely from the US, which accelerated their development process significantly.

If you’re unsure of the legal implications of hiring in a new country, LEGID can help. We have years of experience working with businesses in different countries, and we know the ins and outs of the hiring process. Contact us today for more information: