top of page | PEO: How an EOR (Employee of Record) Works ?

Published by Hector Lopez | SetupGlobal.Com


An Employer of Record is a third party entity, who serves as an intermediary in an existing employee-employer relationship. ...

Our EOR (Employer of Record) solution is designed to make your global operations and hiring new employees in Brazil (or other countries) simple and cost-effective.

The Employer of Record manages all HR and employee integration responsibilities, including:

Hiring and on-boarding

Timely and accurate payroll processing

Ongoing compliance with local labor laws

Additional HR-related tasks

An Employer of Record allows companies to focus on managing their employees, and continue executing their day-to-day responsibilities—without the hurdles of HR-related tasks when operating in multiple markets.

In order for companies to integrate into a new market themselves, they must determine international entity structures, manage tax requirements, and set up processes to address compliance and risk management.

The Employer of Record is responsible for all compliance, payroll, and helps mitigate risks associated with hiring an employee, allowing companies to enter into new markets with peace of mind.

What Are the Benefits of Using a Global Employer of Record?

In addition to compliance, EOR's take on the following responsibilities:

Ensuring a quick entry or exit from international markets.

Cost savings compared to entity setup.

Ability to hire top talent quickly.

Drafting and maintaining compliant employment contracts.

Managing all payroll and tax withholding.

Staying updated on local labor laws.

Providing ongoing support for the HR function.

Alternatives to a Global Employer of Record

Using an Employer of Record is often the quickest and most efficient way to expand into new international markets.

However, there are alternative options to this solution. The two most common alternatives are hiring foreign independent contractors or setting up a legal entity in a foreign market.


May 2019

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