Employer of Record (EOR) Service: How To Find The Best Service For EU

Tips and Tricks from Georgia and Armenia’s Leading Employer of Record Service Team up.

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Table of Content

Employer of Record: What is it?

Employer of Record is a third-party contracting solution. It provides services like payroll or HR for other businesses. First Employer of Record came to public attention in the late 1960s. The practice was largely unregulated until the 1980s.
 

Building a remote team?

A remote team can be a great way to get the best talent from all over the world. With more people working remotely, it's important to know what the benefits and drawbacks are before making the decision to go remote.

The Pros of a Remote Team:

  • You can hire the best talent from anywhere in the world

  • Employees are happy because they have more control over their work/life balance

  • There is less stress since there is no need for face-to-face interaction

The Cons of a Remote Team:

  • It can be difficult to build trust and cohesion without being in the same physical space

  • Communication can be difficult if everyone isn't on Slack or Zoom all day long

  • There is sometimes a lack of clarity about who is responsible for what

  • and lastly, it can be a nightmare on a legal side! 


Enter Employer of Record

Today, an Employer of Record, or EOR, is a third-party contracting solution that allows businesses to outsource their payroll and employment responsibilities. This can be an attractive option for businesses who want to maintain a build a remote team without the administrative burden of managing multiple payrolls in different countries. By using an EOR service, businesses can quickly and easily establish themselves in new markets while ensuring compliance with local employment laws.
An Employer of Record is a company that provides payroll and employment services to another company. This can be especially helpful for startups and small businesses who may not have the time or resources to handle these services in-house.

An employer of record (EOR) is a term typically used in the context of hiring overseas workers. An EOR is any party that hires/pays an employee on behalf of another company and takes responsibility for all formal employment tasks. This may include administering payroll taxes, workers comp insurance, and other benefits while the employee performs work at another company.

Typically, an EOR is a local partner or local EOR. Employers of record companies are responsible for managing payroll and taking on many of the responsibilities that an employer traditionally would. They have a contract with the company which delineates who is responsible for what.

Employer of Record services typically include many components such as:

  • Payroll management

  • Tax administration

  • Benefit provision

  • Compliance with state labor laws

Employers may be called upon to provide EOR services in high-risk or highly regulated industries or regions, such as healthcare, aerospace, financial services and defense manufacturing.

What does an employer of record (EOR) do?

An employer of record (EOR) is a company that provides payroll and HR services to another company. The EOR company is responsible for issuing paychecks, managing benefits, and handling all HR-related tasks for the company that has hired them. Employer of Record is a third-party contracting solution.

An employer of record (EOR) is a company which manages the outsourcing process. EORs can help your business with a number of different HR and legal functions, such as hiring employees in other countries, setting up a bank account or purchasing goods online.

EORs can also be used for international business transactions. For example, if you want to open a bank account in Germany but don't have a physical office there, you may need to use an EOR. Similarly, if you're buying goods from an overseas supplier, using an EOR may make the transaction easier.

Some employers may also use an EOR to help businesses employ workers in other countries legally. This could include residents of a particular state or region within the same country.

Remote is one of many employers of record services providers that operates globally. We focus on more than 40 countries worldwide and have years of experience helping businesses just like yours outsource their employment needs quickly and easily.

Why Use an Employer of Record?

There are a number of reasons to use an employer of record when hiring workers. Some of the benefits include:

  • Tax benefits: using an employer of record can help you save on taxes, as the employer of record is responsible for withholding and paying taxes on behalf of the workers.

  • Compliance: using an employer of record helps ensure that you are in compliance with all labor laws and regulations.

  • Streamlined onboarding: an employer of record is responsible for ensuring that workers are properly registered and onboarded

There are many reasons why a company might choose to use an Employer of Record (EOR) service when hiring workers. Perhaps the most important reason is that an EOR can help a company avoid regulatory and cost hurdles. For example, if a company has a commitment to a certain country, using an EOR can make it much easier to comply with local labor laws.

Another advantage of using an EOR is that it can be more affordable than other HR services such as recruitment agencies. In addition, using an EOR is often more compliant than working with a recruitment agency. This is because the EOR takes on all the responsibility for ensuring that workers are properly registered and paid according to local law.

When to use an employer of record

There are a few times when you might need to use an employer of record. One reason might be if you are a contractor and you want to hire a foreign national for a short-term project. In this case, you would use the employer of record to sponsor the foreign national for a work visa. You might also use an employer of record if you want to start a business in the United States, but you don't want to go through the process of setting up your own

There are many times when an employer of record (EOR) is the best option for a company. For example, if your company is expanding globally but doesn't have the time to set up all the necessary entities in each country, or if you need workers quickly and don't have the local expertise, then using an EOR is a great solution.

Another reason to use an EOR is when you want to test the waters with new employees before making a long-term commitment. You can try out different candidates without any of the risks associated with hiring international contractors. Just be sure to follow all local employment and tax laws, as violating them can lead to some serious penalties.

Using an EOR can be a great solution for companies who want to expand into new markets but aren't sure about the risks involved. It's also helpful when you need workers quickly and don't have the time or resources to establish all of the necessary entities locally. As long as you're aware of the risks and take steps to avoid any violations, using an EOR can be a great way to get your business up and running in no time!

Benefits of Using an Employer of Record

There are many benefits to using an Employer of Record service. One of the most obvious benefits is that it can reduce the cost, complexity, and compliance risk of local employment in foreign countries. Additionally, employers of record can help businesses expand into new markets without having to worry about complex legal issues related to international employment.

Another benefit of using an EOR is that they provide a single point of contact for all your international payroll needs. This includes collecting the necessary tax documentation and ensuring compliant payments are made to your employees. Finally, EORs always offer technical and legal support so you can focus on running your business.

Is employer of record (EOR) legal?

Yes, the employer of record (EOR) is legal. In fact, many companies use EORs to reduce their risk when hiring employees. By using an EOR service, you are essentially outsourcing your HR and payroll functions to a company that specializes in this area. This allows you to focus on your business and leave the administrative tasks to the experts.

EOR organizations are legal because they have robust legal teams on staff. They can help you with all the paperwork and ensure that everything is done correctly. Additionally, by hiring through an EOR versus hiring on your own, you can avoid costly mistakes and potential lawsuits.

How does an employer of record work?

An employer of record is an organization that acts as the employer of record for a contractor or freelancer. The employer of record is responsible for withholding and paying taxes, providing benefits, and handling other HR-related tasks.

When an employer wants to expand their business into new markets, they can do so by using the services of an employer of record. This type of service is becoming increasingly popular as it allows companies to outsource the often difficult and costly task of setting up entities in new countries. An EOR already has local infrastructure in place, making it easy for businesses to quickly and easily hire employees in new areas.

An employer of record is a company that hires employees on behalf of another organization and takes on the legal responsibility for complying with local laws. The EOR handles HR and payroll, while the client company is responsible for managing employees' day-to-day work, including performance reviews and termination decisions. Using an EOR service offers employers the ability to expand into new markets without having an entity set up in those countries, as well as compliance expertise in-country.

Employers of record can benefit from in-country workers’ contributions without taking on risk. They are also able to hire talented people and bring them into their company for a fair wage, being paid back for the work they have done with no risk on their part.

Limitations to Using an Employer of Record

When considering an Employer of Record (EOR) service, it's important to be aware of the limitations:

  • The EOR service will act as the official employer for tax and immigration purposes.

  • The company must still comply with local employment and labor laws.

  • Employees are still entitled to any benefits offered by the local government.

  • An EOR can only provide support for certain aspects of payroll and HR management.

Despite these limitations, using an EOR is a smart solution for companies expanding into new markets or hiring international employees. The EOR will take care of all the bureaucratic red tape, allowing the company to focus on its core business objectives. Additionally, use of an EOR often results in significant cost savings when compared to setting up a subsidiary or local entity.
 

What are the Alternative Options to Using an Employer of Record?

There are a few different alternatives to using an employer of record:

  • Use a PEO: A professional employer organization (PEO) can provide you with the benefits of an employer of record without having to manage the HR and payroll processes yourself.

  • Use an Umbrella Company: An umbrella company can provide you with the benefits of an employer of record without having to create a separate company.

  • Use a Contractor Management Company: A contractor management company can help you

When expanding a business into a new country, there are many things to consider. One of the most important decisions is whether or not to use an Employer of Record (EOR). This option can be helpful in navigating complex employment, payroll and work permit regulations, but it is not the only choice companies have.

There are two main alternatives to using an EOR: hiring independent contractors or establishing a local presence. Each has its own set of pros and cons that should be weighed carefully before making a decision.

Hiring independent contractors is often seen as the first step for companies looking to expand internationally. It offers low commitment levels and variable skill sets, which can be appealing to businesses just starting out or those with limited resources. However, there are some risks associated with this approach. The biggest one is reclassification - if an employer is found to be misclassifying workers as independent contractors, they may face the significant expense and compliance problems.

Another option for companies looking to expand without using an EOR is establishing a local presence. This involves setting up a subsidiary or branch office in the target country and hiring employees directly. While this approach has more upfront costs, it comes with several benefits. There is less risk of reclassification, and companies can be confident that they are in full compliance with the host country's labor, tax, and employment regulations.

Ultimately, the decision of whether or not to use an EOR comes down to a company's specific needs and goals. There are pros and cons to each option, so it is important to weigh them carefully before making a decision.

Can you employ international workers without an EOR?

Employing international workers can be a difficult task, and it's even more difficult if you don't have an Employer of Record (EOR) in place. An EOR is a layer of protection that limits your liability, as well as taking responsibility for all the steps that must occur to hire an overseas worker.

The future of the EOR model is assured, as more and more countries are changing their local regulations on immigration and employment in order to prevent abuses and loss of tax revenue.

If you're looking for a way to employ someone internationally, then contact our team of experts. We can help you navigate the complex process of hiring an international worker without running into any legal issues.

Finding an employer of record for your remote team

When it comes to finding an employer of record for your remote team. There are a few things you need to consider. For one, you'll want to make sure the company has local expertise, so they know how to handle global employment in every scenario imaginable. 

Secondly, you'll want to make sure the company has a strong presence in the country you want to build your remote teams. 

How to Choose an EOR Service

When choosing an EOR service, it is important to consider the following factors:

  • The size of the company.

  • The experience of the team.

  • The quality of the services.

  • The company's reputation.

  • The company's location.

When looking for an EOR service, it's important to do your research and ask the right questions. You'll want to find a company with a good history and performance record. The employment contract should also align with your interests, while the EOR should have a strong understanding of what your business is like.

Make sure the EOR service provider you are considering meets your HR requirements. Find out what kind of contract length and notice period they offer, as well as how they charge fees and when they process payments. Choose an EOR service that is suitable for your company's needs.

When evaluating an EOR, it's important to have a clear action plan about what you want them to handle for you. Evaluating the EOR can give the company better clarity on what they are getting into--and help them decide if this is the right solution for their needs.

The EOR would be someone who has won the confidence of many businesses like yours; so choosing an EOR service is definitely something worth considering if you're not already happy with how things are currently being handled in-house. Once you are confident in the EOR, let them take care of HR activities and go back to focusing more on your core business concerns.

How to compare employer of record (EOR) services?

There is no one-size-fits-all answer to this question, as each service will offer different features and benefits. When comparing EOR services, it is important to consider the following factors:

  • The size of the company

  • The number of countries the company operates in

  • The services offered

  • The company's experience

  • The company's reputation

When looking for an employer of record (EOR) service, it's important to compare different providers and find the one that best suits your needs. Here are some factors to consider when making your decision:

  • Cost: How much will the service cost? Is there a setup fee? Are there monthly or annual fees?

  • Services offered: What services does the provider offer? Do they include payroll, benefits administration, tax filing, and stock options?

  • Experience: How long has the provider been in business? Do they have experience working with businesses in your industry?

  • Ease of use: How easy is it to use the provider's website and software? Are there tutorials or customer support available if you need help using the system?

  • Reputation: What do other customers say about the provider's quality of service, customer support, and ease of use?

Why Georgia or Armenia?

Georgia and Armenia as well as the Caucasus region are known for their high-quality workforce. If you're looking for an employer who can offer you stability and security, they may be a great option for you.

There are a number of reasons to hire professionals from Georgia or Armenia. Some of the benefits include:

  • Stable business environment

  • Competitive salaries

  • Young, skilled & motivated labor force

  • European mindset & culture

  • ~ 3hrs time difference

Employer of Record service is a relatively new concept in Georgia and Armenia, but there are several industry leaders such as Team Up designed for companies who want to hire professionals but don't have time and resources in-house to deal with administering payroll taxes other related obligations.

During the past years, bureaucratic levels eased by simply eliminating dozens of regulations to speed up the process and boost the easiness of hiring new employees working remotely from Georgia and Armenia without lengthy processes and administrative complexity.

As a result, more and more people invest in education and self-development to forward their careers on the international market with better opportunities. The population in the Caucasus is highly skilled and incredibly motivated with nearly 90% having at least secondary education.

So if you're looking for a flexible and versatile employer who can find you the best people, the Employer of Record provider in Georgia & Armenia may be perfect for you!

The Future of International Employment Using a EOR

It's no secret that the business world is constantly changing. With new technology and a globalized economy, companies are finding new and innovative ways to expand their businesses. And as more and more countries become interested in regulating cross-border employment, it's important for companies to understand the ins and outs of hiring employees abroad.

One way to overcome the challenges of doing business in a new country is by using a GEO Employer of Record (EOR). An EOR can provide a layer of legal insulation for companies, making it easier to hire employees in foreign jurisdictions. Additionally, as more and more countries change their regulations to prevent abuses and loss of tax revenue, the EOR will become an increasingly important strategy for international employers.

So what does the future hold for international employment? It's hard to say for sure, but one thing is certain: employing a EOR will be essential for companies looking to expand into new markets.

Conclusion

Like always it is a complex decision if and what EOR Service to use. We hope this article gave you some insights. If you think you can prefer from this please share it with colleagues or feel free to book a free consultation session with us: