young professional man working at laptop
  • Publish Date: Posted 10 months ago

When To Consider Using An Employer Of Record

​What exactly is an Employer Of Record?Many of us have never even heard of an EOR, let alone used one's services. So, what exactly is an EOR, and why should you use one?Employer of Record (EOR) refers to a third-party company that acts as the legal employer of personnel on behalf of another company. The EOR is responsible for ensuring that the individual is compliant with local employment rules and regulations as the individual's legal employer, generally in a foreign nation. The EOR is not responsible for the employee's day-to-day responsibilities and is not engaged in decisions about remuneration, project involvement, or position.EOR services include assuring locally compliant payroll, establishing employment contracts in accordance with country employment regulations, addressing any visa or immigration procedures, and advising the company (their customer) on employee termination issues.​Why would I want to use one?​There are a variety of reasons why a company should consider hiring an EOR. Due to complicated employment laws, it can be difficult for businesses to hire employees in locations where they do not already have a presence. Companies run the danger of breaching local labour rules, which can have serious (and costly) ramifications. EORs can help organisations avoid potential issues while also saving time and stress for HR departments because they are specialists in the location's employment laws and regulations.​Expansion into other countries​Many businesses continue to prioritise foreign expansion in their long-term goals. Setting up operations in a new area, on the other hand, could be a time-consuming, costly, and risky procedure. The EOR can assist in making the process go more smoothly. By using an EOR to hire people in a new location, the company can avoid having to establish up their own legal entity in the new site and HR can avoid having to learn about local employment rules. New employees can be onboarded quickly, allowing the company to focus on establishing itself at the new location.​Using an EOR also allows the company to get to know the new location and market without having to make the large commitments that come with building a new office - if it doesn't work out, the EOR can handle the job termination procedure. If, on the other hand, things go well in the new site and the company decides to stay, some EOR services can help with the move and provide advice to keep the company compliant.​Work from any location​As a result of the COVID-19 pandemic, several organisations were obliged to introduce blanket remote working policies, and a considerable number of companies are still allowing current employees to work remotely. As a result, several people returned to their home countries while continuing to work for their existing employers all around the world. If these workers continue to work from the new site for an extended period of time, this could result in tax liabilities for them. Companies who find themselves in this predicament can hire an EOR to take on these sporadic employees and ensure that they are paying the correct tax in the correct jurisdiction without having to establish up an entity or find an outsourced payroll company.​Employ the Best​Many companies are implementing permanent changes to how their employees work, indicating that remote working is here to stay. As a result, businesses are no longer limited to discovering the greatest talent in their immediate area and may cast a broader net when seeking the perfect fit for their staff. Although this appears to be the perfect circumstance, challenges with contracting and recruiting a superstar applicant can develop late in the hiring process. Imagine finding your unicorn candidate, the individual who has the potential to transform your company, only to be stymied at the last minute by tax and Mandatory Provident Funds requirements. At the very least, this can cause delays in the employee joining your company, and at the worst, you may completely miss out on them and they join a competitor. All of this may be prevented if you recruit your new superstar through an EOR.​Contractors​Many businesses are attracted to hire overseas workers as independent contractors and have them invoice them for their services on a monthly basis. Although this may be a viable alternative if you only need this person's services for a short period of time, it might be quite unsafe depending on the contractor's location. Many countries are tightening down on this, enacting regulations that define who counts as a contractor extremely narrowly. Wrongly identifying an induvial as a contractor can have serious financial ramifications for organisations, leaving them accountable for unpaid taxes, benefits, and yearly leave to workers who should have been permanent employees. If you wish to recruit someone long-term, you can escape all of the difficulties of contractor employment rules by hiring your overseas workers through an EOR.​Global Expansion with Alchemy​Through our worldwide employer of record partners, Alchemy Global Expansion assists businesses in simplifying international expansion. Our partners make it possible for businesses to easily grow into new nations without the need to establish branch offices or subsidiaries.​Alchemy assists you in locating people, while our partners assist you in putting them on a locally compliant payroll. Alchemy, in collaboration with our partners, handles all the details for you, allowing you to employ anywhere, swiftly and easily.

Share this Article
Back to Blogs

​What exactly is an Employer Of Record?

Many of us have never even heard of an EOR, let alone used one's services. So, what exactly is an EOR, and why should you use one?

Employer of Record (EOR) refers to a third-party company that acts as the legal employer of personnel on behalf of another company. The EOR is responsible for ensuring that the individual is compliant with local employment rules and regulations as the individual's legal employer, generally in a foreign nation. The EOR is not responsible for the employee's day-to-day responsibilities and is not engaged in decisions about remuneration, project involvement, or position.

EOR services include assuring locally compliant payroll, establishing employment contracts in accordance with country employment regulations, addressing any visa or immigration procedures, and advising the company (their customer) on employee termination issues.

​Why would I want to use one?

​There are a variety of reasons why a company should consider hiring an EOR. Due to complicated employment laws, it can be difficult for businesses to hire employees in locations where they do not already have a presence. Companies run the danger of breaching local labour rules, which can have serious (and costly) ramifications. EORs can help organisations avoid potential issues while also saving time and stress for HR departments because they are specialists in the location's employment laws and regulations.

​Expansion into other countries

Many businesses continue to prioritise foreign expansion in their long-term goals. Setting up operations in a new area, on the other hand, could be a time-consuming, costly, and risky procedure. The EOR can assist in making the process go more smoothly. By using an EOR to hire people in a new location, the company can avoid having to establish up their own legal entity in the new site and HR can avoid having to learn about local employment rules. New employees can be onboarded quickly, allowing the company to focus on establishing itself at the new location.

​Using an EOR also allows the company to get to know the new location and market without having to make the large commitments that come with building a new office - if it doesn't work out, the EOR can handle the job termination procedure. If, on the other hand, things go well in the new site and the company decides to stay, some EOR services can help with the move and provide advice to keep the company compliant.

​Work from any location

​As a result of the COVID-19 pandemic, several organisations were obliged to introduce blanket remote working policies, and a considerable number of companies are still allowing current employees to work remotely. As a result, several people returned to their home countries while continuing to work for their existing employers all around the world. If these workers continue to work from the new site for an extended period of time, this could result in tax liabilities for them. Companies who find themselves in this predicament can hire an EOR to take on these sporadic employees and ensure that they are paying the correct tax in the correct jurisdiction without having to establish up an entity or find an outsourced payroll company.

​Employ the Best

​Many companies are implementing permanent changes to how their employees work, indicating that remote working is here to stay. As a result, businesses are no longer limited to discovering the greatest talent in their immediate area and may cast a broader net when seeking the perfect fit for their staff. Although this appears to be the perfect circumstance, challenges with contracting and recruiting a superstar applicant can develop late in the hiring process. Imagine finding your unicorn candidate, the individual who has the potential to transform your company, only to be stymied at the last minute by tax and Mandatory Provident Funds requirements. At the very least, this can cause delays in the employee joining your company, and at the worst, you may completely miss out on them and they join a competitor. All of this may be prevented if you recruit your new superstar through an EOR.

​Contractors

​Many businesses are attracted to hire overseas workers as independent contractors and have them invoice them for their services on a monthly basis. Although this may be a viable alternative if you only need this person's services for a short period of time, it might be quite unsafe depending on the contractor's location. Many countries are tightening down on this, enacting regulations that define who counts as a contractor extremely narrowly. Wrongly identifying an induvial as a contractor can have serious financial ramifications for organisations, leaving them accountable for unpaid taxes, benefits, and yearly leave to workers who should have been permanent employees. If you wish to recruit someone long-term, you can escape all of the difficulties of contractor employment rules by hiring your overseas workers through an EOR.

​Global Expansion with Alchemy

​Through our worldwide employer of record partners, Alchemy Global Expansion assists businesses in simplifying international expansion. Our partners make it possible for businesses to easily grow into new nations without the need to establish branch offices or subsidiaries.

​Alchemy assists you in locating people, while our partners assist you in putting them on a locally compliant payroll. Alchemy, in collaboration with our partners, handles all the details for you, allowing you to employ anywhere, swiftly and easily.

Latest Blogs

View All Blogs
hexagon green blue lights art
NFTs Part Two: Why are they popular in the Art World?

​Welcome to Part Two of Alchemy’s blog on NFT Art!Picking up where we left off – we now know what NTFs are and what they represent. But why do people buy them? Why have they become so popular in ...

Digital Nomads working abroad international move relocation
What Motivates Individuals to Move to a New Country?

​82% of employers in the US anticipate an increase in foreign employees over the next 12 months. This begs the question: “What would motivate you to make an international move?”. Secondly, given re...

Pexels Engin Akyurt 2098578
Alchemy Global Talent Solutions Announced as Winner of Outstanding International Recruitment Firm of the Year

​Alchemy Global Talent Solutions is very proud to be announced as the winner of Outstanding International Recruitment Firm of the year at the INT-X Awards 2022. It is an honour to be recognised...

Cube Digital Art Nft
NFT Art Explained: Part One

​In 2022, NFTs, bitcoin, cryptocurrency and blockchain seem to be words present in every conversation on technology, art or futurism. Galleries and Auction houses are setting up their very own NF...

Remote Team Working Work From Home
What is an Employer of Record?

​The best prospects aren't always in the best places. Attracting the right talent can be as simple as offering the correct packages to encourage the “work from anywhere” culture. Many global ...

colourful stairs outside travel destination
Benefits Of Hiring A Global Workforce

The number of employees working remotely has increased dramatically in the last year. Although there were some snags at first, many businesses have adjusted to this new normal, and remote working a...

green apartment building plants
Is Corporate Housing Becoming More Eco-Friendly?

Eco Issues in HospitalityClimate change and environmental issues are global issues. With massive volumes of garbage generated, energy consumed, and disposable goods, the hotel business has a signif...

speech bubble cards
Moving Overseas? Here Are Some Tips For Learning The Language

Moving to a different country is an exciting experience that also provides an excellent opportunity to learn new life skills, such as learning a new language. This may appear to be a difficult unde...

woman purple lights background silhouette
Artificial Intelligence And The Risk To The Immigration Sector

​It's no longer a science fiction fantasy...Artificial intelligence (AI) was once a sci-fi fantasy of the future; now, it is a functioning and ever-increasing part of numerous industries, including...

young couple hot air balloons adventure
5 Tips For Relocating Overseas

​Every year, people relocate abroad, but many do not feel prepared before the move, and it can take a long time for them to settle in once they arrive... Feeling homesick or going through culture s...

rubber ducks at sea
Overboard! When Shipping Containers Are Lost At Sea

​According to estimates, over 10,000 shipping containers are lost at sea each year; however, accurate figures are difficult to come by because not all losses are reported.With the rise in consumer ...

antique fine art green vase
Auction Houses vs Online Bidding

High-end retailers and luxury brands have been hesitant to offer their items online in the past, and have avoided using digital selling platforms. This is a deliberate decision taken by powerful fi...