What's EOR? Who needs EOR?

A company should expand its team globally because it helps to build brand recognition and ensure credibility. It can offer cost savings, new consumer markets, and talented teams overseas. Also, it offers market knowledge and experience for a larger talent pool, tax benefits, and compliance.

However, to ensure the company's expansion on a global level, having an EOR or Employer of Record is extremely important. Now what's an EOR, who needs it, and why should you go for it? Let's discuss it all below:

What is an Employer of Record?

Abbreviated as Employer of Record, EORs are third-party companies that supervise the administrative, onboarding, and related HR responsibilities for a remote team. They are ideal for all relevant legal responsibilities of employees, so you don't have to go through the hassle of administrative complexities. EOR also reduces the pressure related to market access and helps in efficient international talent management.

EORs ensure hassle-free remote workforce management. It prevents the need for subsidiaries and other elements like sponsoring visas and relocation costs for a company. Speaking of their working mechanism, EOR consists of legal entities for recruiting candidates from overseas. Those who partner with EOR can stay assured of risk-free association with internationally hired candidates and the legal compliance of the country.

Who Needs an Employer of Record?

Any company that plans to spread its business in a new country for global expansion may go for EOR. With EOR, they wouldn't require to set up a full-fledged physical entity in that location. EOR can also be used for the contractor workforce or any non-regular labor pool. It offers the flexibility and seamlessness that are required for scaling a global dream team.

Why Do You Need an Employer of Record?

Although we have mentioned it earlier, here are some of the reasons why EOR can be helpful for an organization:

• To manage remote employees abroad
• For paying and assisting organizations with legal and financial procedures of the employee
• Dealing with relevant benefits like insurance, operations, and transactions of human resources.
• Time and indirect cost savings for an organization
• Preventing the need for local incorporation
• Managing payroll in compliance with local standards
• Offering help with immigrants and employment-related tasks.
• Preventing any additional burden like calculations and pay deductions like pension, taxes, and more.
• Avoiding visa overuse and recurrent entries to the country
• Ensuring excellent group-rate prices for benefits for better staff optimization costs.
• Offering help with efficient business operations abroad

How Much Does an EOR Cost?

EOR cost varies per different companies and their packages. Depending on these aspects, it may be free or cost between $49 to $599. In many cases, an organization can offer free EOR services if you hire developers from them.

Generally, a company may offer package services for:

• Contractors
• Direct Employees
• EOR Employees

Contractor packages, as the name suggests, are for hiring and paying contractors from different countries. It may cost a little less, and on average, the package may start from $49.

Meanwhile, Direct employee packages allow onboarding and payroll for direct workers across many countries. Depending on the organization, you can access these packages for free.

Meanwhile, EOR employee packages are set for companies who want to hire candidates from different parts of the world on your behalf. From localized agreements and payslips to advance IP protection, EOR employees can manage all the relevant tasks. This package may start from $599.

What are the Pros of Employer of Record?

Employer of Record offers many benefits in an organization:

Large Productive Workforce

To sustain in the business world, having a large-scale, productive, and satisfied workforce is extremely important. And fortunately, EOR helps with the same. By handling all the relevant administrative tasks for a workforce, EOR ensures none of your employees are dissatisfied. Whether it's onboarding, timely salaries, or benefits, they can handle them all. As your company grows on a global basis, you can stay assured of long-term profits and good employee retention.

Invest Your Crucial Time in Team Building

As EOR works as an international HR compliance expert, you can sign a relief for managing labor and benefits laws in the new countries. These individuals are experienced with all crucial things, whether it's related to compliance or hiring. So, you can leave the burden on them and invest your crucial time in building your team.

Additionally, when you hire an EOR for your organization, you don't have to go through the hassle of establishing a legal entity in that country. This, in return, saves your time too. While the EOR handles your team members worldwide, you can work on thinking about new marketing tactics and boosting your revenues.

On-time Payroll Process

EOR ensures efficient payroll management by offering accurate salaries, taking correct deductions, and delivering timely payments. They maintain employees' trust in an organization and prevent any morale reduction with their payroll process.

EOR also ensures that you are up-to-date with the payroll, payroll tax functions, and compliance concerns. They do the work smoothly without dealing with regular inputs or inquiries from in-house HR teams.

Prevents Overstaffing and Over Expenditure

Why hire multiple individuals and waste your money when a full-fledged team can do it all for you without any extra cost? Whether it's hectic HR procedures or regulatory tasks, EOR can handle everything as one entity. If you hire individual employees for the roles that the EOR covers, you may have to spend a fortune. Also, there's the hassle of managing and retaining employees. So, it's best to prevent the concerns for all these things and go for EOR instead!

Growth on International Level

To become successful on an international level, you have to go through a lot of processes. In fact, to be consistent in the industry, you would require more manpower than you can imagine. But, with the help of EOR, you can easily bypass these steps and outshine your company on an international level.

That's all about EOR. Brix provides professional EOR services for you. We help you build up a strong organization on a global level.

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