How to choose an Employer of Record (EOR) service provider

Imagine a mid-sized software development company based in Seattle, known for its cutting-edge products and agile development teams. Let’s call it The Company for now!

The Company has recently secured a lucrative contract with a multinational corporation, which requires expanding their development capabilities to meet increased demand.

To achieve this, The Company now needs to tap into specialized talent pools in Europe, South America, and Asia.

However, navigating local laws, cultures, and employment practices presents a daunting hurdle. This is where an Employer of Record (EOR) service proves invaluable.

EORs enable companies to expand swiftly and compliantly into new markets without the complexities of establishing legal entities abroad. By outsourcing HR, payroll, and compliance to EOR providers, The Company can focus on scaling its operations and accessing specialized talent globally.

In this guide, we explain the seven criteria for choosing an EOR provider, the questions to ask during your evaluation, and how Multiplier measures up.

Who should choose EOR services?

Employer of Record (EOR) services cater to various scenarios in which businesses seek to expand their operations internationally or efficiently manage employees in different jurisdictions.

Here’s a brief look at who can benefit from EOR services and the challenges they address:

• Businesses expanding internationally or into new markets.
• Small- and medium-sized enterprises (SMEs) who struggle to take on global employment complexities.
• Companies seeking local regulatory knowledge.
• Companies seeking to bypass delays and rapidly enter markets.
• Companies who want to hire and manage international employees for temporary or project-based assignments, addressing the challenge of efficiently allocating resources across global operations.

How to choose an Employer of Record (EOR) partner

When choosing a provider for global EOR services, look beyond the number of countries covered. Evaluate the provider’s local entity network, compliance expertise, payroll capabilities, benefits administration, and ability to support your hiring needs consistently across all target countries.

1. Define your needs and objectives

• Business goals: Define why you need an EOR service, whether it’s for international expansion, compliance management, or specific project requirements.
• Geographical scope: Determine which countries or regions you plan to operate in and ensure the EOR has a strong presence and expertise there.

   

  Use Multiplier’s country-specific employment guides to compare local hiring requirements and employer costs before choosing your target markets.

• Services required: Identify the specific services you need, such as payroll management, compliance assurance, HR support, or talent acquisition.

  If you already have legal entities in some countries, compare payroll and EOR for global hiring to determine which model fits each market.

  How Multiplier measures up: Multiplier supports companies making their first international hires on a deadline, scaling teams across markets, or consolidating employment vendors. For example, Headout consolidated three EOR providers into Multiplier as its people team managed operations across 20 jurisdictions.

2. Evaluate provider expertise

• Global presence: Assess the provider’s ability to operate in multiple countries or regions where you intend to expand.
• Client references: Seek client testimonials or case studies to gauge the provider’s success in delivering services similar to your requirements.

  Explore Multiplier customer stories to see how other companies have used EOR and global payroll services to support international growth.

  How Multiplier measures up: Multiplier’s customer stories show experience across different hiring and operational needs. MoEngage onboarded 50+ employees across 19 countries; DB Results grew its Philippines workforce from zero to 100 employees in 10 months; and FTC Solar reduced administrative turnaround from 15 days to one day. 

3. Compliance infrastructure

• Legal compliance: Ensure the EOR has a robust understanding of local labor laws, tax regulations, and employment practices in each jurisdiction. Look out for a “compliant-by-design” solution that helps you follow local laws.

• Owned entities: Look for an EOR that offers a high number of owned entities, rather than partnering with other companies. As described in our guide to global hiring, this helps you avoid delays. “If you’re onboarding a new team member using an EOR that doesn’t have its own entity, you could face a delay when sending over a compliant contract. Then, if you have questions about the onboarding process, you’ll likely have to wait for replies from several different people.”

  How Multiplier measures up: Multiplier owns legal entities in 160+ countries, providing local employment infrastructure to support your international hiring.

4. Technology and integration

• Platform capabilities: Assess the provider’s technology infrastructure for payroll processing, HR management, and compliance tracking.

• Integration: Ensure their systems can integrate smoothly with your existing HRIS, finance, and management platforms.

  How Multiplier measures up: Multiplier integrates with HiBob, Workday, ADP Workforce Now, SAP SuccessFactors, Personio, Zoho People, and Oracle HCM. Its Growth plan includes integrations across HRIS, expense, accounting, and payroll systems, alongside open APIs.

5. Service quality and support

• Service-level agreements (SLAs): Define expectations regarding service delivery, response times, and customer support availability.

• Client support: Evaluate the provider’s responsiveness, accessibility of support teams, and ability to address issues promptly.

• Onboarding: Look out for a solution that provides a thorough onboarding process but prioritizes efficiency.

  How Multiplier measures up: Multiplier provides 24/7 support and a named Customer Success Manager from day one. You can generate a locally compliant contract in minutes, and your new hire can be ready to work in as little as four hours after uploading their documents.

6. Cost considerations

• Fee structure: Understand the provider’s pricing model, including setup fees, monthly charges, and any additional costs for extra services or expansions.

• Total cost of ownership: Compare costs with the quality of services offered and assess the overall return on investment. An effective solution will include insurance and benefits, expense management, automatic time-off calculations, and full onboarding/offboarding.

  How Multiplier measures up: Multiplier’s Core plan starts at $459 per employee/month when billed annually or $499 when billed monthly. Growth starts at $519 annually or $559 monthly, while Enterprise offers custom pricing. There is no minimum headcount requirement.

7. Security and data protection

• Data security: Ensure the provider adheres to strict data protection standards and complies with regulations like GDPR.

• Confidentiality: Verify measures taken to safeguard sensitive employee and company information.

  How Multiplier measures up: Multiplier maintains SOC 2 Type I and Type II reports, publishes a SOC 3 report, and holds ISO 27001:2022 certification to demonstrate its information security controls.

Questions to ask while evaluating an Employer of Record service

When evaluating an Employer of Record (EOR) service provider during a demo or presentation, asking the right questions can help you assess their suitability for your business needs.

Here are key questions categorized by different sections to guide your evaluation:

1. General overview

• Can you provide an overview of your company and its experience in providing EOR services?
• What industries do you primarily serve, and can you share examples of clients similar to our industry?

2. Compliance and risk management

• How do you ensure compliance with local labor laws, tax regulations, and employment practices in different countries?
• Can you explain how you handle compliance challenges specific to [mention specific country or region]?
• What measures do you take to mitigate risks associated with international employment?

3. Technology and integration

• What technology platforms do you use for payroll processing, HR management, and compliance tracking?
• How do you ensure seamless integration with our existing HR, finance, and management systems?
• Can you demonstrate how your technology solutions improve efficiency and accuracy in global payroll and compliance?

4. Service quality and support

• What are your service-level agreements (SLAs) regarding response times and issue resolution?
• How accessible are your customer support teams, and what support channels do you offer?
• Can you provide examples of how you’ve resolved critical issues or challenges for your clients?
• How do you typically onboard new clients, and what steps do you take to understand our company culture and values?

  For a closer look at the process, see how an EOR can streamline global employee onboarding.

5. Cost and pricing

• What is your fee structure, including setup fees, monthly charges, and any additional costs?
• How do you ensure transparency in pricing and billing?

6. Security and data protection

• How do you ensure the security of our sensitive employee and company information?
• What measures do you have in place to comply with data protection regulations (e.g., GDPR)?
• Can you provide details about your data security protocols and certifications?

7. Additional questions

• Can you share examples of how you’ve helped clients scale their workforce or operations efficiently?

Can you share testimonials or case studies from satisfied clients?

Use Multiplier’s EOR RFP template to turn these questions into a structured provider evaluation.

How to read HR reviews of EOR providers

Read reviews for patterns before you trust the star rating. Check how recent the reviews are, how many there are, and whether the vendor referred or rewarded the reviewers. Then weigh what people praise about support and onboarding against what they keep complaining about.

Multiplier on G2 and Capterra

We checked our own listings so you don’t have to start from scratch.

Read the most recent reviews yourself, and use each platform’s filters for company size and reviewer role to find teams like yours.

EOR service-support matrix: who handles what

Before you sign, find out who owns each part of the employment relationship — and who steps in when something goes wrong. Ask every provider the same questions below, then compare their answers with what Multiplier publishes in its FAQ and EOR Terms.

Multiplier provides 24/7 EOR support and a named Customer Success Manager from day one on every tier.

European EOR due diligence: entity and delivery model

In Europe, start with two questions: who’s the legal employer, and does the provider employ staff through its own entity or a partner? The answers decide whose name is on the contract, who you escalate to, and which local licensing rules apply.

The table below shows what Multiplier publishes for seven European markets. It’s a starting point for your own checks, not a ranking of providers.

Multiplier’s listed European entities

Entity names come from Multiplier’s About page.

Questions to ask any EOR provider for each European country

• What’s the name of the legal employer on the employment contract?
• Do you employ staff in this country through your own entity or a partner?
• Which local license or registration do you hold, and can we see it?
• When did you last verify this, and will you confirm it in writing?

What costs are associated with EOR Services?

The cost of EOR services can vary by country based on local employment requirements, statutory benefits, taxes, and other employment-related costs, including:

• Monthly service fees: Recurring charges per employee for ongoing payroll processing, compliance management, and HR administration. Examples include monthly fees per employee for payroll processing and tax withholdings and administrative fees for HR support and employee record management.
• Additional costs: These are fees for specific services like benefits administration, legal compliance, and employee support. For instance, costs may include administering health insurance benefits and retirement plans, and legal consultation fees for ensuring compliance with local labor laws.
• Geographical complexity: Costs may vary depending on the complexity of compliance requirements in different countries or regions. For example, there may be higher fees for countries with stringent labor laws and regulatory requirements, and additional costs for managing payroll, taxes, and statutory benefits in multiple jurisdictions.

To get an accurate estimate of EOR costs, it’s advisable to request detailed pricing information from EOR service providers. They can provide customized quotes based on your specific business needs, the number of employees, and the countries where you require EOR services.

Review Multiplier’s EOR pricing and use the employee cost calculator to estimate total employment costs across countries.

Countries where EOR services are available

Global EOR services enable businesses to hire and employ workers across multiple countries without establishing a local legal entity in each market. When comparing providers, consider whether they have the local entities, compliance infrastructure, and in-country expertise needed to support your target countries.

The specific countries where EOR services are present can vary depending on the provider’s global network and expertise. Multiplier, for instance, provides EOR services in more than 160 nations.

Common regions where EOR services are offered include:

• North America: United States, Canada, Mexico, etc.
• Europe: United Kingdom, Germany, France, Spain, Netherlands, etc.
• Asia-Pacific: China, Japan, Australia, Singapore, India, etc.
• Latin America: Brazil, Argentina, Chile, Colombia, etc.

It’s important to verify with EOR service providers which countries they operate in and their capability to support your business’s specific international expansion or workforce management needs.

This ensures you select an EOR partner that can effectively manage compliance, payroll, and HR administration in the countries relevant to your operations.

Introducing Multiplier

If you’re looking for a comprehensive EOR solution that can be tailored to your specific needs, look to Multiplier. You can find all the tools you need to onboard, pay, and manage your global team in one solution and access 24/7 support from day one. Our technology automates compliance, but we also utilize local experts and assign dedicated points of contact from day one. 

To learn more, schedule a demo today.

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