What is an Employer of Record?

EOR is a hassle-free recruitment service for startups and growing companies.

With its convenient workforce management and budget-friendly packages, you can hire overseas employees legally without setting up offices in other countries.

In this guide, you’ll discover everything about EOR and its role in employment management. I have covered all the essential areas, including some top platforms, to help you get a general idea of the service.

What is EOR?

Employer of Record–EOR–is a third-party HR company that takes responsibility for onboarding and paying overseas employees on your behalf.

It acts as your legal representative, handling operational and compliance matters to make workforce management as smooth as possible.

With the help of an Employer of Record, you can hire people from anywhere and work with them legally and stress-free.

How Does Employer of Record Work?

When you hire an Employer of Record, you sign a master agreement, giving it the right to become a legal employer of your remote workers.

Once hired, your EOR connects with your employees, oversees the onboarding paperwork, disburses salaries, and performs other administrative workflows such as termination.

Most platforms also provide additional services, like background checks and immigration support. The range of services typically varies, but you get all the essential features.

EOR Core Services

The services you receive from an Employer of Record largely depend on your chosen package.

The standard package typically covers onboarding and payroll, but you can customize your plan to receive add-ons, like immigration assistance or contractor management.

Here are the four core services every EOR delivers.

Hiring and Onboarding–Connecting with employees and overseeing the onboarding paperwork.

Payroll–Calculating and disbursing payments.

Compliance–Handling compliance management processes, including contract generation, benefits administration, and taxes.
Visa/ Immigration Assistance–Managing the documentation and employee relocation.

Let’s explore them a little to get more clarity.

1. Hiring and Onboarding

Hiring isn’t technically an EOR’s job, but some providers, like Remote, do offer talent sourcing services as an add-on. An Employer of Record’s core job is to oversee the onboarding process specifically.

It connects with your remote employees, sends compliant contracts for signing, collects the necessary documents, and sets up payroll and taxes. In addition, it handles insurance and other statutory benefits.

If you offer some company perks such as equipment or allowance, your Employer of Record can also manage that for you.

Key areas EOR covers are;

Contract generation.
Document verification.
Onboarding and orientation.
Equipment shipment.

2. Payroll

EOR’s payroll service covers salary calculation, tax deductions, and payment disbursement. The agent is responsible for generating accurate payroll to eliminate compliance errors.

For example, if your employment agreement includes a monthly bonus, it’s EOR’s job to ensure it’s added to the gross salary.

Attendance and expense tracking systems are built into the payroll software for your convenience. You can manually manage leave, expenses, and allowances.

Key areas EOR covers are;

Payroll and tax calculation.
Benefits administration.
Payment disbursement.
Currency conversion.

3. Compliance

Compliance management is EOR’s top priority. As your Employer of Record, it oversees the hiring and payroll process closely to make sure you meet all the legal and regulatory requirements.

For example, Australia’s minimum wage and leave policies might differ from Ireland’s. Your Employer of Record tracks the updated labor laws and generates tailored employment agreements.

Key areas EOR covers are;

Labor laws and tax compliance.
Benefits administration.
In-country policy updates.
Ongoing support.

4. Visa/ Immigration Assistance

Many EOR providers offer mobility support to their clients. They can apply for the visa on your behalf and help you with accommodation and immigration documentation.

This is, however, an add-on service. The level of support also depends on the provider’s network. For example, Remofirst offers Visa assistance in 85+ countries, while Deel’s visa package covers 50+ countries.

Key areas EOR covers are;

Visa application.
Document tracking.
Ongoing support.
Residence through third parties.

Pros And Cons of Employer Of Record

EOR offers great expansion opportunities to businesses, but it comes with its own set of challenges.

Before engaging an Employer of Record for your company, you should consider its benefits and potential drawbacks to see if the service is suited for you.

Here are some pros and cons of working with an Employer of Record;

Pros

You can use Employer of Record to hire people from practically anywhere. Most providers have access to more than 90 countries, offering an excellent opportunity to diversify your remote team.
Hiring through an EOR is typically fast. While the actual onboarding process might take weeks or even months, the paperwork is generally quick.
EOR covers all the necessary compliance workflows, saving you from getting tangled in the legal paperwork.
Outsourcing the onboarding and payroll to EOR is comparatively cost-effective. For a fixed fee, you can manage everything from one place.

Cons

EOR is a third-party service. The moment you end the contract, you’ll have to restart again to get compliance support. Established organizations might find it a bit inconvenient.
EOR’s best feature is compliance management outsourcing. While it saves you from getting tangled in paperwork, you’ll have little control if you face any legal trouble.
Pricing isn’t always transparent. You’ll probably see hidden charges after consultation or signing the contract. It isn’t a dealbreaker, but it can increase the overhead cost, impacting your budget.

Business Insights

What To Look For When Choosing An EOR

Hiring an Employer of Record for your company is an important decision. You need to consider certain factors, such as cost and service quality, to evaluate the providers and find the service that meets your company and budgetary requirements.

Below, I have listed the five things to look for when choosing an EOR. Use them as a benchmark to shortlist your options.

1. Reputation

Check out both online and offline channels to assess the platform’s reputation.

You can reach out to past customers, explore social media communities like Reddit or Quora, and check out review platforms.

2. Package Features and Rates

Get tailored quotes from different providers to compare services. While most EOR platforms offer similar rates, their country-specific packages may vary.

Some also offer limited product features but good rates—like Remofirst.

Look for other features as well, such as payment gateways and billing currencies, to ensure you are choosing the right provider.

3. Scalability

Browse the package features to measure the provider’s service quality. See if they offer scalable plans and can manage bulk onboarding.

For example, Oyster offers a scale package to companies with over five hires. They can get discounted annual rates and the option to reuse the seat without additional overhead costs.

4. Add-ons

Explore their product line to see if you could get more features in your EOR plan.

Top add-on features you can request from a provider include background checks, visa sponsorship, relocation, and equipment shipment.

If your workforce has a mix of contractors and employees, you can manage both through an Employer of Record as well. Platforms, like Deel, offer excellent contractor management packages.

5. Tech Support

Explore the digital tools an EOR provides to its clients. Each platform runs in-house systems to onboard employees and connect with clients.

Check their core features and tech support to measure their software capabilities. It’s better to try out an EOR’s digital platform before engaging their services.

Best Five Best EOR Platforms

Employer of Record is an online service. You can reach out to EOR providers on their websites and purchase the packages through their digital portals.

Below, I have reviewed the top five EOR platforms with extensive global coverage. Most offer free consultations with product demos to help you make an informed decision. But, if you can’t find what you are looking for, the in-house sales team is available for assistance.

Let’s check them out.

1. Deel

Deel is a leading global HR platform. It offers EOR services in 150+ countries and delivers excellent compliance management.

You’ll receive a user-friendly digital platform with a centralized dashboard and built-in compliance. You’ll be able to oversee onboarding, collect legal documents, approve expenses, and run payroll.

Deel also has engagement tools for the workforce. You’ll get an LMS, communication plugins like Slack, and performance management modules.

What makes Deel stand out is its global coverage. It runs its owned entities in most countries to deliver a smooth experience.

Core Features

Employee onboarding.
Background checks.
Compliance.
Global payroll.
Benefits administration.
Equity option.
Digital and IT support.
Custom reporting.
Immigration assistance.
Mobile app.

Price

Deel’s package starts from $599.

2. Remote

Next on the list is Remote. It’s also one of the top EOR providers, offering similar products and a free HR app for day-to-day activities.

Its global coverage is comparatively lower, but you’ll receive all the benefits, including built-in security for intellectual property protection. You’ll also get basic operation management tools, such as time tracking, expense management, attendance, and payroll.

Onboarding is fast, and you’ll receive ongoing support from its in-house team. You can use Remote to find candidates as well. Two years back, Remote launched its talent sourcing to offer a complete hiring package.

A short demo is available on the website to check out the software’s usability. Plus, you can ask for a live demo.

Core Features

Talent sourcing.
Onboarding paperwork.
Payroll.
Compliance management.
Digital platform.
Benefits administration.
Equity management.
Visa sponsorship.
Reporting.
Integration.
Mobile app.

Price

Remote charges $599 per user on its annual plan and $699 per user on its monthly plan.

3. Oyster

Oyster is a user-friendly platform with an efficient employee onboarding system and simple team management features. Via Oyster, you can hire people in 130+ countries and pay in 120+ currencies.

You’ll get a free contractor account with a cost calculator to estimate your prices. If you like its services, you can upgrade your package to EOR, and convert your contractors to permanent employees.

Add–ons are available with the core packages. You can get benefits administration and visa sponsorship with EOR.

Oyster also provides a salary insight tool. You can get instant information on market competitive salaries to create fair packages.

Core Features

EOR in 130+ countries.
Compliant contracts.
Global payroll.
Benefits administration.
Digital platform.
Cost calculator and salary insights.
Scale package.
Visa sponsorship.
Talent sourcing.

Price

Oyster charges $699 per month. You can book a demo to explore it.

4. Remofirst

Remofirst is comparatively affordable. It charges almost half the prices for the same services.

The platform has extensive global coverage and a good third-party network for add-on support. You can hire it for onboarding, offboarding, payroll, benefits administration, and visa sponsorship.

Remofirst’s digital platform also provides excellent features. You’ll get a built-in chat for communication and several tools to manage time off, bonuses, and benefits.

Core Features

Employment in 180+ countries.
Global payroll.
Compliant contract.
Benefits administration.
Equipment handling.
Digital platform.
Visa and work permit.

Price

Remofirst charges $199 per user. You can try it for free.

5. Velocity Global

Velocity Global has one of the largest partner networks. The platform has access to 185+ countries and also runs its own entities in several countries.

Its EOR package covers employment, payroll, benefits administration, and equity programs. You can also get M&A support and immigration assistance.

A free product demo is available on the website. You can calculate your EOR cost and explore the digital platform.

Core Features

Onboarding.
Global payroll.
Benefits administration.
Compliant contract.
Equity program.
Immigration.
M&A support.
Reporting.
Integration.

Price

Velocity Global shares prices on request.

Make sure to check out our list of the 15 best EOR platforms here →

Conclusion–Why Should You Choose An EOR?

You should choose an EOR provider for overseas employment because there’s no major drawback to this service.

Sure, every service comes with some limitations–the most common is inadequate customer support–but in this case, the benefits exceed the shortcomings.

How?

EOR’s role is to simplify overseas hiring and payroll. In this partnership, you maintain full control over your workflows and get the final say on employment and payroll. In other words, you can hand over the complex tasks to another company and keep the day-to-day operations to yourself.

If you are a growing company, looking for an easy and cost-effective way to hire international resources, EOR is the best option for you.

Try out the above platforms, get free consultations, and decide what’s best for your company. Good luck!

What is an Employer of Record? – EOR Explained