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Are you an employer who plans to go worldwide? If yes, you need an employer of record services. The global hiring industry is very competitive, and you must find great talent.
If you do it yourself, you can be a bit lucky to find a perfect candidate. And after that, you realise that your current payroll provider doesn’t support hiring from that country.
When hiring outside your country, you need to consider factors like legal compliance and taxes. How do you deal with payroll processing and tax registration? And how do you govern employment benefits, social contributions and contracts?
The only solution to all these questions and concerns is opting for the best employer of record service. Keep reading to learn about the employer of record, including what it means, how it works, and the services and benefits it offers.
What Does EOR Mean?
EOR is a short form for employer of record. An employer of record is a third party that acts as the legal employer for all of your employees.
The third-party organisation takes care of all responsibilities on behalf of the company, including management, payroll and onboarding. It’s vital to note that employer of record service providers differ in terms of operation.
While some own legal entities, others don’t and only act as intermediaries. Some providers have hybrid models where they own entities and, at the same time, act as intermediaries. Global employer of record service providers are also available.
These organisations have native entities set up in different parts of the world. They allow a company to look for international talent without going through the expensive and laborious local entity establishment process.
Working with a global employer of record will enable you to hire, pay and offer benefits to great talent globally quickly and affordably.
What Services Does an Employer of Record (EOR) Offer?
An employer of record facilitates the intermediary role in healthy, already-existing employee-business relationships. Here are all the functions and services that these companies offer:
- Carrying out all regulatory and legal requirements for payroll, immigration and employment
- Providing advice on some matters like severance pay, termination guidelines and notice periods
- Offering a legal entity for founding and operating locally compliant payrolls
- Managing global employees’ benefits
- Bridging between the authorities and the employees
- Filing insurance and tax forms
- Arranging the necessary documentation, which includes visas and work permits
While an employer of record can perform all these duties, the initial employer still has the power to control and make decisions on important matters such as termination, projects, duties, compensation and responsibilities.
What Are the Benefits of an Employer of Record?
Working with employer of record service providers is a common practice for worldwide businesses. Reaching out to an EOR service provider helps business owners minimise management expenses, enhance team efficiency and alleviate risks. Additional benefits include:
- Eliminate worldwide market entry hurdles
- Onboard great talent quickly
- Provide ongoing HR support
- Retain great talent and provide comprehensive benefit packages
- Maintain compliance with evolving labour laws and employment contracts
When selecting an employer of record, you need to keep some important considerations in mind. These considerations include transparent pricing, global coverage in target markets, accurate calculations of employer burden, independent third-party validation and support and responsiveness.
If you’re after a straightforward and easier way to govern worldwide hiring and worker benefits, there is no perfect substitute for employer of record service providers. Using EOR companies will make everything easier and affordable, providing you with much-needed peace of mind.