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What is an Employer Of Record (EOR)?

An employer of record (EOR) is a company that offers international employment services and assists you in hiring employees legally abroad. An Employer of Record (EOR) handles administrative and onboarding tasks on your behalf. You can concentrate on your team because your EOR takes care of the payroll, benefits, taxes, stock options, and local compliance.

Businesses rely on employers of record to assist them in hiring employees internationally. Without having to establish a local entity, which may be costly and take months or longer to complete, a business can expand operations into another country with an EOR. Working with an EOR enables companies of all sizes to swiftly and affordably hire and pay employees abroad.

Let's now explore how an EOR operates.

To provide their recruitment services, EORs have legal companies in the countries. As a result of EOR's oversight of legal compliance in those nations, businesses collaborating with EOR can reduce risks by recruiting overseas staff. As they take on the duty of legal compliance for employment abroad, they essentially function as external HR departments.

What are employer of record (EOR) services?

Employer of record services enable businesses without local legal organisations to lawfully hire employees abroad. These services, which include payroll, benefits, taxes, stock options, and compliance, primarily fall under the purview of the legal and human resources departments.

For businesses wishing to expand their teams into other markets, advising services may be another employer of record option. An EOR might provide guidance on how to integrate remote workers or how to develop a global remuneration plan, for instance.

What does an employer of record (EOR) do?

On your behalf, an employer of record hires employees in another nation. For instance, you may use an EOR to hire a worker in Malaysia if your business is based in the United States.

An employer of record can handle a variety of HR and legal tasks, such as:

  • Enabling companies to employ full-time workers lawfully in other nations;

  • Handling payroll for workers abroad;

  • Managing foreign contractors;

  • Handling benefits administration for global workers

Employing individuals across different states or parts of the same nation might benefit firms as well. As an illustration, a business in Sarawak might use an employer of record to hire a person in Kuala Lumpur.


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