The world is more interconnected now than it has ever been before. When it comes to business expansion, geographical boundaries no longer exist, and international expansion can take place from any corner of the globe. Because of this, businesses are also looking for the best ways to expand as quickly and seamlessly as possible. However, given the situation with the COVID-19 Pandemic, most borders are closed and travelling is either troublesome or close to impossible. So, where does one begin? That’s where Employer of Record (EOR) services come in. An EOR is an expert in employment, immigration, tax regulations and compliance. Their main purpose is to simplify the process of a business’s international expansion. EORs are gaining in popularity due to their convenience and cost-effectivity. Let us break down the basics of what an EOR is, what it does and how it can benefit your business.
First of all, an EOR is a key option available when one decides to expand their business globally. In layman terms, this means outsourcing all employer responsibilities and liabilities to a third party. This includes contracts, hiring process, compliance, tax and payroll-related duties. In this manner, companies no longer need to set up local entities in foreign countries in order to expand overseas. An EOR allows companies to expand overseas and deploy workers efficiently and legally without the hefty cost and risk of setting up an entity overseas.
Why an EOR?
Companies face a plethora of challenges and hurdles to overcome when it comes to hiring employees overseas. In other countries, business can be an entirely different ball game as you face a completely different set of economic, social and cultural contexts that can differ greatly from what you are familiar with.Researching on and staying compliant to various laws and regulations is necessary, but can also be the downfall for many companies who may accidentally fall short. Luckily, an EOR is well-versed and experienced with the laws and regulations in the countries they operate in. This means that they can take care of all the necessary paperwork and compliance issues for clients. With an EOR, any business can ensure that they stay compliant to the local laws and regulations without any hiccups.
Furthermore, partnering up with an EOR saves businesses the cost of having to set up a local entity abroad. This is often time-consuming as it can take up to a few months or even years to process and approve. Furthermore, this is often a costly process as well. An EOR eliminates these costly, time-consuming processes and enables companies to hire employees overseas without the need to set up a local entity. This also cuts down the amount of time needed to process this, and is often a lot more affordable than setting up a local entity as well. This saves any business a whole lot of time, money and effort which can be otherwise spent on planning and strategising for the business.
Businesses are growing significantly more global as time passes, and everyone needs to keep up with this expansion in order to stay relevant. An EOR allows businesses a cost-effective, easy way to do so. Talk to us today if you have any questions regarding engaging an EOR for your business, and we’ll be more than happy to help you.