What Can an Employer of Record Do for Your Business?
What Can an Employer of Record Do for Your Business?
What if someone could help with the trickiest paperwork associated with your business?
Having an Employer of Record can be a real game-changer for businesses around the world. Unfortunately, most of the workers who would benefit from this the most don’t know anything about it.
So, what is an Employer of Record? What can it do for your business, and how can you get started? Keep reading to discover the answers!
What Is An Employer of Record?
Our guide is going to walk you through all the benefits of using an employer of record. First, though, we need to answer the obvious question: what is an Employer of Record?
Simply put, an EOR an employer for the tax purposes of different employees. Put another way, the EOR serves as an important intermediary between an employee and that employee’s client company.
An EOR is not right for every business. But in certain situations, it may be the best choice for the success of your career or organization.
An Alternative To Human Resources
Still unclear about what an employer of record does? A good way to think of an EOR is that it functions as an alternative to a traditional human resources department.
An EOR handles many of the things that HR would traditionally handle (more on this later). So, why would anyone rely on an EOR instead of their own HR department?
In some cases, this decision helps save money. Small businesses, and especially new businesses, may have an easier time paying for a third-party EOR rather than hiring a full HR staff and paying their full salaries and wages.
An EOR also makes sense for employers that wish to create a fully remote workspace. Since CEOs and managers will already be coordinating with employees remotely, coordinating traditional HR responsibilities remotely makes sense and, as we noted before, can save the organization money.
What Can An EOR Do?
We have noted how an employer of record offers an alternative to traditional human resources. But what, exactly, can an EOR do for you or your business?
Traditional, EORs process payroll, file taxes, deal with employee contracts, conduct background checks, and onboard new employees. Your EOR can also handle timesheets, unemployment compensation, certificates of insurance, employee benefits, and so much more.
Again, these are the kinds of responsibilities most businesses would use their internal Human Resources departments for. But in our dynamic and increasingly-global work environment, an EOR simply makes more sense for many businesses across the world.
Is This the Same As a Professional Employer Organisation?
If you have previously explored alternatives to HR, then some of what an employer of record can do may sound very similar to what a Professional Employer Organisation can do. With that in mind, is an EOR the same thing as a PEO?
The short answer to this question is “no.” While a PEO also handles many of the responsibilities of an EOR, traditional PEOs are also responsible for managing employees. This has made PEOs a very popular choice within the United States for businesses that need assistance in helping and handling their workers on a day-to-day business.
An EOR can handle all of the responsibilities that we outlined before and so much more. But beyond that, an EOR will leave it up to the client company to manage their own employees. This relationship often works better for employees because it removes the perception that an outsider is telling them what they can and can’t do (which happens often with a PEO).
Promoting International Business
Earlier, we mentioned that EORs are a popular choice for entrepreneurs that want to either start a new international business or expand an existing business into a new country. But what makes EORs such a good choice for employers who want to go global?
When you use an EOR, it’s a lot easier to hire local talent in a new country. For that matter, a good EOR can help you find and recruit the best employees. This is a great option for small businesses that may lack the time or other resources necessary to research potential hires.
EORs are also experts in subjects like labour laws and other regulations in countries all around the world. When you rely on the services of an EOR, you greatly reduce the odds of committing any compliance violations.
Hitting the Ground Running In a New Country
Perhaps the biggest benefit of using an EOR is how much time they can save. And this is often very crucial to businesses hoping to hit the ground running in a new country.
For example, everything that we outlined before could be handled internally by your own company. You could conduct your own extensive research into labour laws and compliance regulations of various countries. Similarly, you could conduct your own in-depth research of potential employees to hire around the world.
Your business may very well have the financial resources and expert personnel necessary to get the job done. But ask yourself: how much time is this going to take? And how much better could that time be spent helping build your brand?
When it comes to business opportunities, there are few things quite as important as being able to strike while the iron is hot. And with an EOR handling much of the paperwork and legwork, your own business can get a jumpstart on the competition as you expand your business to its full potential.
Your Next Move
Now you know more about what an employer of record is and what it can do for your business. But do you know where you can find an EOR that you can trust with your business?
Here at Bradford Jacobs, we specialize in helping businesses just like yours achieve maximum success all around the world. To see what we can do for you and your business, all you have to do is contact us today!