Employee becomes a contractor - you change the paper to make sure it doesn't fall under 'employment' category and they pay their own taxes according to the coun

Employee becomes a contractor - you change the paper to make sure it doesn't fall under 'employment' category and they pay their own taxes according to the country rules, or simply outsource that to any local accountant. I'm pretty sure that if your employee is working for a US company they already know how to handle that. You can also use a service like useme.com or Oyster where they will invoice you on behalf of the employee and then figure out the way to pay the employee.