[shakkhar]

I think the biggest hurdle in hiring offshore employees is a legal one. A company has to comply with local labor laws and tax code. In some countries, you may even be required to have some form of physical presence. The hassle of working these out is only worth it when you are hiring thousands of employees in a country.

[njhaveri]

I've never used one, but I have heard of some "Employer of Record" companies that have a physical presence in the country you're looking into hiring in. They'll effectively hire the employee on your behalf, and then you just pay their sister entity (in the same country as you) a consulting fee equal to the employee's salary plus whatever fees are applicable. Could be an option for companies looking to start doing this.