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It took a pandemic for many employers to recognize the productivity benefits of working from home. With 42% of the labor force now remote, the state boundaries that once confined us are gone. Remote work is not expected to go away, which means employers have an opportunity to go after diverse talent from around the country. But what if your workplace wants the best talent from a state or country you aren’t registered in currently? Here’s how an employer of record (EOR) can help you comply with regional hiring rules no matter where you are.
Employer of record can help you with your basic hiring needs and make the recruitment process in another country much less arduous and complicated.
As you can notice an Employer of record takes care of everything
When you get a new hire through an EOR, this person will already be ready to work. The employer of record will have already taken them through the onboarding process and prepared them for the job. Additionally, an employer of record should have their own payroll software and take care of payment for all of their employees. This means no one misses their paycheck and you don’t have to manage pay period timesheets. Finally, if the employee doesn’t fit the position, the EOR will terminate their contract. However, keep in mind that the employer of record doesn’t influence your business decisions and that you as the business owner have full ownership of your staff’s working relationship. The employer of record takes care of the administrative tasks around hiring, from the very first to the last day of an employee’s contract.
For companies worried about compliance as they begin staffing additional remote workers across the world, the EOR gets to find the right people while keeping remote teams engaged in the organization’s success. Want to know more about Roots EOR? Click here
An Employer of Record regulates the relationship between the client company and the employee as a “third party” also called EOR.
It helps the employers retain, hire, payroll issues, insurance, visa applications, and other types of applications and paperwork about their employees when the employees attempt the company from another country.
Why Should Companies Use an EOR? Here some reasons:
When expanding, setting up a local entity via incorporation and registration can be very time consuming and costly, needing expertise and knowledge in order to remain compliant.
A global EOR might be the better alternative, supporting the company by handling payroll, employment and immigration requirements in the host country. The EOR would be an intermediary between the client-company and assignee, helping to ensure compliance through its network and expertise.
If you are looking to access international talent in a compliant way, an EOR can help you do just that, making sure that compliance is met and further HR-related processes run smoothly.
More and more employers are looking into becoming a hybrid or even remote first company, allowing not only future but also existing employees to work from anywhere in the world.
This however is a highly complex process, with many aspects that need to be taken into consideration such as each country’s labor laws as well as possible lack of experience in managing teams remotely.
With an EOR, your company will be able to give this approach a trial phase with a smaller number of employees. This would result in an easier and better prepared transition as well in important financial and time savings.
Many companies profit from an alternative workforce such as freelancers and contractors. You might consider converting freelancers to employees because of various reasons such as a greater control over the working time, increased sense of belonging to your company and more commitment, reduced turnover rate and many more.
An EOR can help you retain this talent and support you in long term workforce planning by shouldering important transition and HR processes to remain compliant.
If one or some of your employees is considering moving permanently to another country, don’t make this a reason for letting them go. Being able to maintain your talent even if their wish to move abroad for an indefinite amount of time will not only reduce your turnover rate but can also strengthen your employer brand with increased flexibility and innovative features.
An EOR will be able to support you during the process, being in charge of the labor law, payroll differences and further aspects that need to be taken case of when wanting to remain compliant.
More flexible work arrangements may be one of the pandemic-driven changes that will endure for businesses across industries for years to come. Many companies have realized their employees can be just as productive working remotely. That´s why it can be a good time to hire employees from other parts of the world. Need held to do it?
3 ways to hire and pay remote workers:
Given the current economic uncertainty, it will be tempting to just hire a new worker as an independent contractor and avoid long-term employment obligations altogether. The problem with this approach is that every country has their own statutory guidelines on classification of workers, and just because a company claims the worker is a contractor does not guarantee that status.
If a contractor is hired full time, paid a regular amount like a salary and has their schedule and work methods controlled by the company then they could be classified as an employee. That would lead to non-compliance claims against the company, back taxes and contributions and in some cases fines in the foreign location.
One interim method of hiring a new employee is to use a local partner/supplier in the host country where the company has an existing business relationship. The partner could agree to put your employee on their payroll and take care of all employment administration for your company. This can work well where your company has a solid business relationship with the partner, who may be willing to help during a transition.
A final option is to outsource employment administration to a Global Employment Organization (GEO) using an Employer of Record (EOR). The EOR in the host country will be familiar with local restrictions surrounding COVID-19 and can assist with navigating those rules for employees and residents.
Even if your company is planning on eventually setting up their own corporate entity, using a GEO will allow you employ your workers temporarily until the pandemic eases and business life returns to normal.
In this articles you can read more information about EOR solutions
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Advanced technologies, growing economies, access to new markets and a skilled workforce are all factors that motivate companies to expand outside their borders. When considering expanding internationally however, many businesses think that the only one way to achieve this goal is by setting up their own entity in a foreign country.
It is certainly true that this option can work extremely well for companies who are building infrastructure and have pre-defined long-term plans for the country. However, if a business is looking to expand quickly without delays then working with an EOR provider could be the solution.
So, if you’re a company is looking for a fast way to expand their business and hire workers then an Employer of Record (EOR) solution could be considered. Why? Here a list of some of the benefits:
If a business is looking for a quick expansion strategy that enables them to employ remote workers in different countries at the same time, then EOR solutions will help achieve this goal. This is a great way to test the market without having to set up a subsidiary. EOR solutions make it easier for businesses to expand into new international markets quickly and in a safe and potentially profitable manner.
An EOR solution allows a business to retain valued workers who may move to a different country for personal or other reasons.
Enables companies to focus on their core business activities
EOR solutions make it easier for business to concentrate on the running of the core day-to-day business. Business can focus on core activities without the hassle of organizing global payroll and HR. EOR solutions save valuable time and resources that would be spent on understanding the complexities of setting up in country.
So… Why use an employer of record provider?
With advancements in technology, it is possible to outsource many of the responsibilities that your company has to someone in another part of the world. Your remote worker can handle these tasks and make sure that your customers are taking care of as if you were handling them.
A. Lower your costs
As virtual employees work from their homes and other remote locations, you save on in-office costs like rent, internet, desks, parking, etc. This allows you to scale up your workforce at a fraction of the cost.
B. Provide services around the clock
As you can hire virtual employees from all over the globe, you can take advantage of time differences to work on projects around the clock. This is especially helpful for customer support teams as you can provide a 24×7 service without overworking anyone.
C. Get a more diverse staff
With access to people all over the world, hiring a remote employee will give you access to people from different backgrounds and cultures. This will not only boost your brand’s global reputation but also give you more perspectives to boost creativity.
Here’s exactly what you need to do:
1. Identify Your Needs
The first step in hiring a virtual employee is determining what you need.
2. Create A Good Job Description
If you want to hire a good virtual employee, you need to write a good job description.
3. Determine Where You Want To Hire From
The next step is identifying where you want to hire your virtual employees from.
4. Conduct Interviews
Once you have narrowed down your list of candidates, it’s time to start interviewing them online.
5. Start with A Trial Assignment
One of the best ways to determine how well a candidate fits your operations is by giving them a trial assignment.
Last but not least, we give you 2 more reason to choose us.
It is important to understand local employment law when terminating an employee or you risk legal action. Every country has its own regulations for termination, notice period and severance payment, so it’s vital to follow the regulations and stay compliant.
An EOR keeps you informed of the process and ensures a lawful termination
When you create a new entity, you may be unaware of all the local language and cultural factors, which can lead to misunderstandings and cause tensions.
Often, you’ll need to hire cultural advisors and translators to ensure a smooth process, which is difficult when all local documentation needs to be compliant with local
regulations and available in local dialects too.
With an EOR, you receive help from a Country Expert who explains cultural clashes and language differences in English. This way you avoid any cultural or language issues.
EOR is responsible for:
• Visa, immigration and work permits
• Country compliant payroll and taxes
• Advice on cultural and language awareness
• Adhering to local labour laws
• Advice on required notice periods and termination rules
For many organizations and companies, the prospect of expansión can be overwhelming. Creating a new local entity in an unfamiliar country is frequently a long, stressful and costly process without any guarantee of success. Therefore, many businesses choose to delay before they finally step forward globally, but these delays hand your competitors first-mover advantage. More and more businesses are taking advantage of Employer of Record services to take these initial global steps first.
Want to give this step? Contact us