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I'm working as a software developer (kinda) for a small US company (we have around 10 Employees in the office in California). I'm a foreigner and was working for this company as a freelancer at first, then moved to the full-time remote job and it ended up with they paying for a rent of an office for me where I was allowed to hire 2 junior developers. I registered my own company in my country to manage this. I'm communicating with project managers, developing, leading 2 guys, paying salaries, rents and managing all everyday office needs and so on.

At first, I was getting around $40k per year as a regular freelance developer. After that, when I've got fulltime job I had a raise to $55k per year with 2 weeks of paid vacation. That was before I got all these new responsibilities - real office & a small team.

Now it's been two years since my last raise. And I'm thinking how to get as much as possible from my current position.

I understand that an employee with a similar job would get a much higher compensation in the US. On the other hand that's the point to take me abroad - to save money.

So my main questions are:

Can I ask US-competitive compensation or not and why? What compensation would be competitive? I'm not even sure how to call my position. It seems to be an odd mix of different jobs.

Main concerns:

  • My English's far from perfect
  • My company knows that it would be hard for me to get another job like this
  • My company knows that my current compensation is already very good in my country

Sorry for a long post, thank you in advance.

UPDATE: Thanks to the comments I've understand that my situation is having much more similar with independent contracting than I thought. Although there're differences: I don't have any specific separate project or conditions when my services are ended. Our team are the only developers who's working on a flagship product. So it's not a project-level outsource, It's more like unofficial overseas branch. I treaten myself as a developer way too long. A cause of misunderstanding is a fact that the development still takes much more efforts for me than management and running an Ltd.

nev
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    I don't quite understand how you can own a company, with 2 employees, and all 3 of you work for another company as legal employees. Are you paying their salaries or is the company you work for paying their salaries? – Clay07g Mar 19 '18 at 17:51
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    To hire people, rent an office and get money from abroad I have to register a company. I'd get legal problems if I just receive money as an individual. I also need to pay taxes and insurance for employees and so on. As for the money, I've negotiated how much these two new employees costs monthly for my employer. And he just includes this amount into my paycheck. – nev Mar 19 '18 at 18:10
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    To be clear: are you paying rent plus 2 employees out of your $55k? also, it sounds like you are not "full time" but rather a 1099 contractor which is very different. – NotMe Mar 19 '18 at 18:14
  • I probably wasn't clear when I said - I'm working for a company. I'm sort of pseudo self-employed with a single client. – nev Mar 19 '18 at 18:14
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    @scorch You sound like a contractor. And that arrangement is very sketchy. What if your employees have legal protections and rights that you are responsible for in the event you are "fired"? What happens when your contract is up, and you want to disband your company and forced to pay your employees severance? You're not asking for salary increases. You're asking that the company pay your company more. And you need to treat your company like a company, not a team, or you could be headed into serious problems. – Clay07g Mar 19 '18 at 18:17
  • I can't imagine it's illegal for the company who's paying you to open an office in your country and hire people. It sounds like they want a contracting company to work for them and convinced you to create one, instead of creating an international branch. – Clay07g Mar 19 '18 at 18:19
  • NotMe, initially, it was a deal that I'm hired not for some project but constantly: 40-hours week, paid vacation bi-weekly payments - so it's not a freelancer but a salaried employee. After that, they asked me to rent an office and hire two new employees. Yes, they're paying additionally for these expenses, it's beyond my $55k. I'm not sure is independent contractor term suits here since our office is working regularly - there's no project or fixed-term contract, we're treaten as a part of the company. Sorry for the confusion, it's not so easy to be clear :) – nev Mar 19 '18 at 18:48
  • Clay07g, you're right. The additional confusion is in the fact that all my agreements are verbal. I understand that it's not safe, but I'm working for this company for about 5 years totally (last 2 years as this weird version of an international branch) and I'm pretty confident about them, there's no money related problems during these years. As for the employees legal protections and severances - I was convinced that in case of any emergencies I will get compensation for all expenses. You'd say I'm naive, right :) – nev Mar 19 '18 at 19:05
  • Clay07g, Of course, it's not illegal for them to open a branch in my country, but it will be much more expensive than using me as a proxy I suppose. – nev Mar 19 '18 at 19:05
  • Possible duplicate of How can I determine a reasonable salary to ask for? – gnat Mar 19 '18 at 19:56
  • @scorch, "Confidence in them" or trust really have nothing to do with it. What if the other company gets purchased? What if your main contact gets hit by a bus and is replaced by someone else who doesn't like to outsource? There could be a thousand and one reasons things could go wrong, many of which have nothing to do with trust. If I were you, I would ask for more money to mitigate some of those risks and future expenses. And I would also try to diversify and get other clients. Do you have a contract with your two employees, so that they can't be stolen by the company from under you. – Stephan Branczyk Mar 19 '18 at 20:50
  • Also, please stop using the term "salary" in your question. You need way way more than a salary. You also need a retainer for legal counsel. – Stephan Branczyk Mar 19 '18 at 20:53
  • @scorch you have only verbal agreements with the company and they're using you as a proxy for establishing an office in your country. I can't see any way for this to end well for you, legally. The company took a shortcut in establishing business in your country and something legally required to do so was probably overlooked. I agree with Stephan Branczyk, you need legal counsel here. – alroc Mar 20 '18 at 11:23
  • Thank you very much for comments. I understand risks and I'm ready to take all the consequences in case of any problems. Let's put the legal things aside, I will consult on them separately. The only question is money and it seems that my current level of responsibility is far above development and basically includes micro-branch management+independent contracting above regular development & team leading tasks. So I'll start negotiation and will keep this in mind. – nev Mar 20 '18 at 11:42
  • alroc, verbal agreements is between me (person) and the company I'm working with. At the same time between me (Ltd) and a legal authorities everything clear. My Ltd is receiving money from non-resident Ltd and I provide an offer contract for every payment, which has a point that a fact of payment means acceptance of this contract. With a small amounts like mine it's a pretty simple job and I don't need to do any complex accounting on this. – nev Mar 20 '18 at 12:24
  • @scorch if they are employing you in county X they have to meet the statutory minimums for country X rather than just assuming that US employment law applies. – Neuromancer Mar 20 '18 at 15:43
  • @Neuromancer, hah, you would die from hunger if you get our minimal wage :) I don't think employment laws are related to the question. – nev Mar 20 '18 at 16:39
  • @scorch your government /tax authorities would probably not agree and stuatory means the minimum many country's have longer legaly enforced minimum annual leave requirements. – Neuromancer Mar 20 '18 at 16:49
  • @Neuromancer, officially for my government I'm a founder of Ltd and the labor law (working hours limitations, required annual leave, official holidays) isn't applicable to me. – nev Mar 20 '18 at 17:17

2 Answers2

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Disregarding laws and morals, this is a price negotiation. You ask for as much money as you think they might pay you.

Factors include your extensive knowledge of their business, which would take time to replace if they dropped you and hired someone else, and the value to them of the contribution you make (the money it generates for them, not the amount they pay you).

But also consider that if you cost as much as an on shore hire, they are more likely to consider replacing you.

user16259
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If I get you right, you're not interested in simple salary negotiation advice. Rather, your situation is as follows:

  • you're working for company X in a country with low IT salaries compared to company X's home country
  • but they provide you with a salary which is way bigger than the salaries in your countries
  • however it still is lower than salaries in country X's home country

So you can say something like your_country_salary < your_salary < company_country_salary more or less.

The first thing to realise is that while practically you are an employee of said company, technically you are a contractor to them. Which means that the 55k they are paying you is the total amount of money they spend on you. Whereas for a regular employee, they'd need to add other taxes which the "employer is supposed to shoulder", health insurance, pension matchings, office space, etc. they don't need to do any of that for you. Depending on the company and location, you could be looking at the total cost of employing somebody to be 1.5x-2x of the gross. So that is definitely a margin which works in your advantage. It's up to you if you use it in a negotiation. But it might make you more at ease that you're not asking for too much and making it not worthwhile to have you.

The other things you mention - the fact that you have a local Ltd they're using to hire other people is a separate matter, but it can be used to your advantage in negotiations. Alongside all the institutional knowledge you've gathered and the projects you've been part of.

Horia Coman
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  • Thank you very much for an answer. I'll use your points as a basis for negotiation strategy. – nev Mar 20 '18 at 11:45