Increasing Demands Of Employers Of Record Services: Yes or No?

Companies can legally and effectively connect with foreign workers in a new nation or state by using an Employer of Records, without having to set up a local organization or risk breaching local employment rules. An employer of record (EOR) is a third-party corporation that recruits and pays employees on behalf of another company, as well as handling all official employment responsibilities.

Because the EOR works in a certain method, it’s possible that they won’t be the best fit for your recruitment requirements. There is a way to hire staff internationally without having to set up a subsidiary: EOR, employer of record .

In the next five years, more than 75% of respondents said their organizations are utilizing or planning to use an EOR to help them with their business strategy.

You don’t need to have a local firm if you hire workers using an employer of record services. Rather, your worldwide personnel are hired on your behalf, which is sometimes precisely what your firm requires. The EOR service providers help in this process.

Differences Between EOR And PEO


1. Works for big business groups

2. EOR deals with hiring people and also the tasks done by PEO Services

3. If you hire an EOR, it will handle all the compliance insurance. 

4. With EOR the full employer relationship lies within the third party organization. 

5. EOR can hire employees from any state. 


1. Works for mid level and small businesses

2. PEO provides HR benefits to the companies that includes payroll and benefits, regulatory compliance etc. 

3. If you hire a PEO, you are own for your insurance. 

4. PEO allows third -party to step in and control HR functions Services. 

5. PEO needs to maintain strict boundaries for hiring.

Most Important Arguments,

1. This type of employee leasing with an employer of record has shown to be more useful than in-house solutions as an increasing trend throughout the world, especially in light of the Covid-19 epidemic.

2. The ability to hire staff from anywhere in the globe without the need for a subsidiary registration will help your company grow faster. As a result, the employer of record is an excellent choice for small businesses that want to expand into new markets.

When employing the EOR model, 60% of client businesses maintain some control over their company operations and are responsible for worker safety and regulatory compliance on-site of EOR employees.

Advantages of Using Employment of Record Services (EOR)

1. Optimal working conditions: The global employer of record services will create a more congenial working atmosphere that is better suited to the locals they hire. Each EOR is accustomed to interacting with possible candidates in their territory. They have a better understanding of the working cultures of the individuals they recruit.

2. No extra payroll taxes: When you hire through the EOR employer of record services, the taxes that must be paid are already included in the fee you pay. This saves endless hours of manually paying taxes in each nation.

3.No requirement for local incorporation: While some businesses can justify the effort and expense of establishing a foreign subsidiary, in many cases, using a GEO local Employer of Record is the best option.

4. No co-employment deal: An employer of records, unlike Professional Employer Organizations (PEO).  that offer to be co-employers with your company, makes things easy. They work as  full-fledged legal for EOR employees (on your behalf).

5. No administrative risk: Employers of record services may also help ensure that labor and tax laws are obeyed in many states. Our worldwide employer of record services stays on top of changes in state and local regulations across the country, so you don’t have to.

6. Employer Of Record handles everything: When you recruit someone through an EOR hr, they will be ready to work right away. The onboarding process and employment preparation will have already been completed by the record employer.

Disadvantages Of Employer Of Record Services

1. HR deterioration: Using EOR PEO services will relieve your company’s human resources department of some of its responsibilities. This isn’t always a negative thing because it will need a lot of effort from your HR department. It may lead to the outsourcing of too many positions, causing your HR department to fall behind.

2. Culture shifts in the workplace: Having someone else recruit staff might influence how you want your firm to grow. Even though the EOR is the legal employer, their treatment of employees will have an impact on you.

3. EOR is not appropriate for more than 10 countries:If a corporation intends to enter or develop significantly into a nation, it will almost certainly create its own organization, recruit local personnel, and oversee the payroll process. 

In this instance, the EOR may be nothing more than a band-aid solution to get employees back to work as soon as possible.

4. You can feel like you’re losing control: Hiring a third party as EOR provider to handle the recruiting process will give you the impression that you have less control over the employee onboarding process.


The EOR Services Of Our Company As A Solution

1. The HR benefit administration is handled by the employer of record, who ensures that labor/employment rules, such as anti-discrimination laws, are followed.

2. Discussions with previous employees or groups concerning working conditions are included in workplace records.

3. Employees or groups were met by our EOR services to review working conditions.

4. A worldwide employer of records provides  EOR payroll management administration, 

which withholds earnings and, in some cases, payroll taxes. Following that, the charges were notified to the tax authorities.

Bottom Line

Benefits and drawbacks are often subjective. What appears to be the greatest course of action for some firms may be detrimental to others. However, one thing is undeniable: with remote working options and new markets available, the employment of record service setup environments is becoming increasingly widespread.

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