What Is an Employer of Record (EOR)? A Simple Guide for Growing Companies

Expanding your team globally opens doors to new markets and a wider talent pool, but it also comes with complex legal and regulatory challenges. From understanding local labor laws to ensuring compliance with payroll requirements, international hiring can be daunting.

An Employer of Record (EOR) service simplifies this process, offering startups and growing businesses a compliant, cost-effective way to hire employees internationally without the need for setting up a local entity.

This guide explains what an EOR is, what it handles, and why it is a popular choice for startups seeking to hire globally.

What Is an Employer of Record?

An Employer of Record (EOR) is a third-party provider that acts as the legal employer for your international employees. Essentially, the EOR employs workers on your behalf, while you manage the daily tasks and work assignments of your team. The EOR takes care of everything from employment contracts to taxes and compliance with local laws.

Key Responsibilities of an EOR:

• Employment Contracts: Drafting contracts compliant with local labor laws.
• Payroll Processing: Managing salary payments, withholding taxes, and handling government reporting.
• Employee Benefits: Ensuring employees are enrolled in mandatory benefits such as social security, health insurance, and other required contributions.
• Ongoing Compliance: Keeping track of local labor laws and ensuring that your team is always compliant.

By utilizing an EOR, businesses can avoid the complexity of setting up a local entity in every country they hire in, while also remaining compliant with local regulations.

Why Startups Choose EOR Services for Global Hiring

Hiring internationally can provide significant growth opportunities but also presents unique legal hurdles. An EOR service provider helps startups remain agile, flexible, and compliant as they expand. Here’s why startups choose EOR services:

• Faster Time to Hire: With an EOR, companies can onboard international employees in a matter of days, as opposed to the months it typically takes to establish a local legal entity. This allows startups to scale quickly without delays.
• No Local Entity Required: An EOR eliminates the need to incorporate in every country you hire in, saving legal fees, setup costs, and avoiding lengthy delays. This provides a more efficient way to enter international markets.
• Minimized Compliance Risk: Misclassification, tax issues, and labor disputes can arise when hiring in different jurisdictions. An EOR provider ensures that all contracts and payments comply with local laws, protecting your business from compliance risks.

Why Simply Source for EOR Services?

Simply Source provides outsourcing and workforce solutions applicable to businesses of all sizes, who are looking to expand their teams globally without the complexity of setting up a local entity.

With Simply Source’s EOR services, you get:

• Transparent pricing with no hidden fees
• Fast, reliable onboarding in over 100 countries
• Employment contracts tailored to local laws
• Dedicated HR and compliance support
• A simple, modern platform to manage your global remote workforce

Simply Source makes global hiring seamless, allowing you to focus on scaling your business while we handle the legal complexities.

Start Hiring Globally with Confidence

Expanding your team globally doesn’t have to involve navigating legal complexities or setting up multiple entities. Simply Source’s EOR services allow you to hire top talent from around the world, ensuring compliance and simplifying payroll management—all without the need to establish a local office.

Start Hiring Smarter Today

Visit Simply Source to learn more about how we can help you expand your business globally with ease