Foreign labor contractors recruit workers residing outside the United States for employment opportunities in California. Hiring international contractors can be useful but comes with challenges like IRS requirements or foreign labor laws.Do you need a 1099 for international contractors? Your guide for understanding how to hire and pay independent contractors around the world. Use this article to speed through each step of the process when hiring a contractor so you can quickly bring on the best help for where your business is at. If you have any doubt about the requirement to withhold, go ahead and do it and use a Form 1042. The hiring entity must establish that the worker performs work that is outside the usual course of its business in order to satisfy part B of the ABC test. Learn how to hire independent contractors overseas and ensure compliance with foreign employment laws to avoid misclassification risks. To hire independent contractors, you must address issues of compliance, classification, finance, and process. An international contractor is a person who works on a perproject basis for a company headquartered in a foreign country.