We are a small U.S. company with about 30 employees. We would like to hire one employee in Germany who is a German citizen and will work out of his home. He will primarily be writing software on a computer provided by us. All of our business is in the U.S.
What formalities do we need to do to hire him? Can we just have him sign an employment contract and send him paychecks twice a month (and dealing with local tax, social security laws, etc.)? Or do we have to do something more formal like open a branch or create a German subsidiary?
Any pointers to useful info would be helpful. I've found some good sites that compare branches with subsidiaries, but I would like to know if we can avoid doing either of those entirely.