An Employer of Record (EOR) is a third-party organization that takes on the legal responsibilities of employment on behalf of a client company. The EOR manages tasks like payroll, taxes, benefits, compliance with labor laws, and other administrative duties, while the client company retains control over day-to-day management of employees.

Companies use an EOR to streamline compliance when hiring employees in foreign countries or regions where they don’t have an established entity. It allows businesses to expand globally, hire remote workers, and manage HR functions without navigating the complexities of local labor laws and tax regulations.

The client company remains responsible for the day-to-day management and oversight of employees’ tasks, performance, and projects. The EOR handles the legal and administrative aspects of employment, but the client manages the employees’ actual work.

Yes, using an EOR is legally compliant as long as the EOR adheres to local labor laws in the countries where employees are hired. EOR providers are experts in managing legal compliance, helping businesses avoid legal risks associated with employment regulations, tax laws, and employee benefits.

Yes, an EOR is particularly beneficial for international expansion. It allows businesses to hire and manage employees in foreign markets without the need to set up a legal entity. This saves time, reduces administrative costs, and ensures compliance with each country’s specific employment laws.

EOR pricing models vary on the number of employees, and the complexity of the services offered. We charge a flat fee per employee or a percentage of the employee’s salary. While using an EOR involves costs, it often saves businesses from the higher expenses associated with legal entity setup and compliance management.

An EOR can typically onboard employees much faster than setting up a local entity. In most cases, onboarding can take anywhere from a few days to a couple of weeks, depending on the country, legal requirements, and documentation needed.

Without an EOR, companies may face significant legal and financial risks, including non-compliance with local labor laws, incorrect tax filings, improper employee classification, and the potential for lawsuits related to employment issues. These risks can result in costly fines and damage to the company’s reputation.

An EOR can be used as a long-term solution for companies looking to maintain a presence in multiple countries without the burden of managing international HR compliance. However, some businesses may use an EOR as a temporary solution while setting up a legal entity or testing new markets.