An Employer of Record (EOR) is a third-party organization that legally employs workers on behalf of another business. The EOR takes on all employer-related responsibilities and tasks, such as onboarding, payroll, employment contracts, taxes, and benefits, while the client company retains control of the day-to-day operations. The EOR is responsible for ensuring that employees are hired in accordance with local laws in every country or jurisdiction and provide them with compliant employment contracts.

Using an EOR can be beneficial for companies looking to expand globally without the costs of launching an entity or the complexity of building the expertise required to manage compliance in-house. EORs can significantly speed up a company’s global expansion efforts, offer a quick way to employ staff in new markets, and facilitate swift growth. EORs can also help companies hire full-time and part-time employees compliantly, increase a company’s flexibility in staffing, and save time and money in the hiring process.

EORs often offer a variety of benefits, such as health insurance, time-off policies, parental leave, and more, but these vary from service to service. EORs can also help with local regulatory compliance, with local experts handling all aspects of employment within the bounds of the local jurisdiction.

It is important to consider whether the EOR will require a significant investment in time and people-power on your end. You may want to look for an EOR that automates the busy work like onboarding and benefits enrollment and other common HR and IT tasks, which can save you time.