The top 15 Employer of Record services for global expansion

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 blog, we discuss the essentials of EOR services, outlining what they entail and providing a comprehensive list of the top 10 EOR services available in the market. 

Whether you’re exploring global expansion or seeking efficient workforce solutions, our guide will help you choose the perfect EOR service to fit your unique global expansion needs.

What are the employer of record (EOR) services?

Employer of Record (EOR) services are specialized solutions that allow businesses to hire and manage employees in different locations without the need to establish a legal entity in each jurisdiction.

By acting as the official employer on paper, the EOR assumes responsibility for various employment-related tasks, including payroll, benefits administration, tax compliance, and adherence to local labor laws.

This enables companies to expand their global workforce efficiently and compliantly, focusing on their core operations while the EOR handles the complexities of international employment.

How does an EOR service work?

Employer of Record (EOR) services work by acting as the legal employer for your international employees, handling all employment-related responsibilities on your behalf.

Here’s a step-by-step overview of how EORs typically work:

1. Engagement: Collaborate strategically with an Employer of Record (EOR) service provider to facilitate seamless global workforce expansion.
2. Onboarding: Strategically identify and recruit talent in target locations. The EOR offers meticulous onboarding processes to ensure all documentation aligns with stringent local regulations.
3. Employment contract: The EOR crafts meticulous local employment contracts that adhere to regional labor laws and industry standards.
4. Payroll and benefits administration: Delegate payroll processing, tax withholdings, and employee benefits administration to the EOR. This ensures accurate, timely payments while maintaining strict adherence to complex local tax regulations.
5. Compliance management: Ensure comprehensive compliance with diverse local labor laws through expert guidance and proactive risk mitigation strategies provided by the EOR.
6. Employee management: Optimize operational efficiency by outsourcing day-to-day HR tasks, such as employment records, leave management, and performance reviews to the EOR. Retain control over strategic workforce deployment and task assignment.
7. Ongoing support: The EOR provides continuous, personalized support. This includes addressing HR challenges, managing dynamic employment changes and terminations, and ensuring compliance throughout. The EOR’s regular reporting and process refinements enhance operational efficiency and compliance integrity.

With EOR services, your company can focus on its core business activities while seamlessly managing a global workforce with the assurance of compliance and efficient administrative processes.

What are the different types of EORs?

Employer of Record (EOR) services can vary based on the provider and the specific needs of businesses expanding globally. Here are the primary types of EOR arrangements:

1. International EOR: Provides comprehensive global expansion support, managing payroll, compliance, and HR functions across multiple countries or regions. This is ideal for companies looking to enter diverse international markets without establishing local entities.
2. Regional EOR: Focuses on specific regions or continents, such as Europe, Asia-Pacific, or Latin America. Regional EORs offer tailored expertise and compliance knowledge relevant to regional labor laws and business practices.
3. Specialized EOR: Offers niche expertise in specific industries or sectors, providing customized HR and compliance solutions tailored to the unique needs of specialized markets.
4. Project-based EOR: Supports temporary or short-term projects in international locations. It facilitates rapid deployment of workforce resources without long-term commitments or entity setup.
5. Hybrid EOR: Combines elements of EOR with other HR outsourcing models, such as PEO (Professional Employer Organization) services. Offers flexibility in managing workforce needs across various jurisdictions.
6. Technology-driven EOR: Utilizes advanced technology platforms for payroll, compliance management, and employee administration. Enhances efficiency and transparency in HR operations for global businesses.

Choosing the right type of EOR depends on factors such as the scope of international operations, industry-specific requirements, and the desired level of administrative control and flexibility.

Each type of EOR service provider offers distinct advantages tailored to support businesses in navigating global expansion challenges.

The key benefits of hiring employer of record services

• Streamline global expansion of your business across borders
• Access the best talent anywhere in the world, anytime
• Ensure compliance with labor laws and avoid any potential penalties and fines
• Run seamless, on-time salary disbursement with global payroll processing
• Reduce your liabilities and risk exposure in foreign markets
• Scale up business operations with the flexibility that EORs offer

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

Choosing the right EOR partner is crucial for businesses looking to expand internationally or manage global workforce compliance efficiently. Here’s a comprehensive guide on how to select the best EOR service provider:

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

2. Evaluate provider expertise

• Industry experience: Look for EOR providers with experience in your industry sector, as they will better understand your unique needs and compliance requirements.
• 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.

3. Compliance and risk management

• Legal compliance: Ensure the EOR has a robust understanding of local labor laws, tax regulations, and employment practices in each jurisdiction.
• Risk mitigation: Evaluate how the provider manages compliance risks and mitigates legal liabilities for your business.

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.

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.

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.
• Value for money: Compare costs with the quality of services offered and assess the overall return on investment.

7. Cultural fit and partnership

• Alignment with values: Choose an EOR provider whose values align with your company culture and operational philosophy.
• Long-term partnership: Look for a provider willing to build a collaborative, long-term relationship and grow with your business needs.

8. Security and data protection

• Data security: If the provider operates in Europe, ensure it adheres to strict data protection standards and complies with regulations like GDPR.
• Confidentiality: Verify measures taken to safeguard sensitive employee and company information.

9. Scalability and flexibility

• Scalability: Assess the provider’s ability to scale services as your business expands into new markets or grows globally.
• Flexibility: Look for a provider that offers flexible solutions to accommodate changing business requirements and market conditions.

10. Industry reputation and stability

• Market standing: Research the provider’s reputation in the EOR industry, including reviews, awards, and recognition from industry bodies.
• Financial stability: Ensure the provider is financially stable and capable of sustaining operations in the long term.

By following these steps, businesses can effectively evaluate and select an EOR service partner that meets their specific needs, ensures compliance across global operations, and supports sustainable growth and success.

Questions to ask while evaluating a 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?
• How many countries or regions do you currently operate in?
• 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?

5. Cost and pricing

• What is your fee structure, including setup fees, monthly charges, and any additional costs?
• Are there potential hidden costs or fees we should be aware of?
• How do you ensure transparency in pricing and billing?

6. Cultural fit and partnership

• How do you typically onboard new clients, and what steps do you take to understand our company culture and values?
• Can you describe a successful long-term partnership with a client, including how you’ve adapted to their evolving needs?
• What steps do you take to foster collaboration and communication between our teams and yours?

7. 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?

8. Scalability and flexibility

• How do you support businesses in scaling their operations into new markets or expanding globally?
• What options do you offer for adapting your services as our business needs change over time?
• Can you share examples of how you’ve helped clients scale their workforce or operations efficiently?

9. Industry reputation and stability

• What sets your company apart from other EOR providers in the market?
• Can you share testimonials or case studies from satisfied clients?
• How do you ensure financial stability and operational continuity for your clients?

10. Additional questions

• Is there anything specific about our industry or business model that you would like to know more about?
• How do you stay updated with changes in global labor laws and regulations?
• What is the typical timeline for implementing your EOR services and going live in new markets?

These questions should provide a comprehensive framework for evaluating and comparing different EOR service providers based on your specific business requirements and priorities. Adjust them as needed to reflect your company’s unique needs and focus areas during the demo or presentation.

Top 15 Employer of Record companies

This is a review of the 15 best Employer of Record companies. Find out their features, advantages, and disadvantages to make an informed choice.

1. Multiplier

• Operates in over 150 countries, ensuring broad international presence
• Simplifies international payroll, covering payments in over 120 currencies and complying with local tax laws
• Empowers HR and finance teams to manage payroll, onboarding, and benefits efficiently from a single platform
• Ensures employment contracts are thoroughly compliant with local laws, minimizing global hiring risks
• Provides localized HR expertise and visa support in 140+ countries for smooth operations
• Curates best-in-class, localized insurance coverage with customization options for international employees
• Maintains secure cloud infrastructure, GDPR compliance, and enterprise-class data protection policies
• Named an Industry Leader and IEC Star in the 2024 IEC Global EOR study, reflecting strong market position
• The wide range of services offered by Multiplier can be overwhelming initially

2. Globalization Partners

• Operates in many countries, providing broad international coverage
• Offers localized HR expertise and specialized knowledge in local labor laws and HR practices, ensuring compliance
• Proactive compliance updates: Actively updates clients on changes in local employment laws, maintaining legal compliance
• Complex pricing structure, with a minimum 15% markup on each employee’s monthly salary
• Several one-off fees such as country setup fees, wiring fees, per-employee setup fees, and offboarding fees
• Lacks specific tools for managing contractors
• Rely on local third-party vendors in some locations, which may result in delays and an inconsistent experience
• The use of third-party vendors can expose intellectual property to risks
• No global payroll services

3. Velocity Global

• Ideal for companies looking to scale operations quickly
• Ensures comprehensive compliance with local employment laws, reducing legal risks
• More expensive compared to some competitors, especially for SMEs
• May have service limitations in specific countries or regions

4. Remote

• Offers clear and straightforward pricing models
• The user-friendly platform is easy to use and with a clean interface
• May lack some advanced features compared to other EOR services
• Integration Issues: Limited integration capabilities with other HR systems

5. Deel

• Offers flexible contract options for different employment types
• Operates in multiple countries, providing broad international support
• Complex Pricing Structure can prove difficult to understand and follow
• Some users report delays in customer support responses

6. Papaya Global

• Uses advanced technology for payroll processing and compliance
• Offers a broad range of services, including payroll, benefits, and compliance
• Can be expensive, especially for smaller companies
• Businesses may face integration challenges with existing HR systems

7. Gustav

• Strong focus on staffing and contractor management
• The user-friendly interface is easy to navigate and manage
• Primarily focused on staffing, with fewer features for full-time employee management
• Can prove expensive for smaller businesses

8. TalentWave

• Strong focus on compliance with local employment laws.
• Excellent customer support known for responsive and helpful service
• May have limited coverage in certain countries or regions
• Pricing is customized based on client needs

9. Galvin International

• Expertise in Global Expansion; Specializes in helping businesses expand globally
• Ensures stringent focus on compliance with local laws and regulations
• The onboarding process can be lengthy and complex

10. TopSource Global Solutions

• Comprehensive payroll services across multiple countries
• Strong compliance focus ensures adherence to local employment laws and regulations
• May lack some advanced features compared to competitors
• Businesses can face challenges integrating with other HR systems

11. HireRight

• Excellent at conducting thorough background checks
• Operates in multiple countries, providing comprehensive international support
• Limited HR services that are primarily focused on background checks, with fewer HR management features

12. Blue Marble Global Payroll

• Excellent payroll management across various countries
• The user-friendly interface is easy to use and navigate
• Can be expensive, especially for smaller companies
• May lack some advanced HR management features

13. iiPay

• Uses advanced technology for efficient payroll processing
• Operates in multiple countries, providing broad international support
• Custom pricing based on the number of employees and specific services required

14. Fidu

• Offers flexible employment and payroll solutions
• The user-friendly platform is easy to navigate and use
• May lack some advanced HR management features

15. Pasona Global

• Specializes in the Japanese market, providing localized expertise
• Offers a wide range of HR and payroll services primarily focused on Japan
• Can prove expensive, especially for SMEs

What costs are associated with EOR Services?

The cost of Employer of Record (EOR) services can vary based on several factors, 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.

Countries where EOR services are available

Employer of Record (EOR) services are typically available in multiple countries and regions around the world. EOR providers establish networks and partnerships to offer compliant employment solutions in various jurisdictions.

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 150 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.

Top Industries implementing EOR services

Businesses in several industries partner with EOR services when expanding globally, entering new markets, or testing waters in different countries. They include

• Information technology
• Renewable energy
• Financial services
• Management consulting
• Staffing and recruiting
• Legal services

If you’d like to understand how Multiplier can partner with you in your global business needs, schedule a demo today.

FAQs

Q. Can your employer of record service handle payroll and tax compliance?

Absolutely! EOR service excels in seamlessly managing your payroll and ensuring stringent tax compliance with efficiency and accuracy. Multiplier, for instance, handles these critical tasks to alleviate the administrative burden from your team, allowing you to focus on your core business operations.

Q. Can you employ international workers without an employer of record (EOR)?

To employ international workers compliantly, you either need the services of an EOR provider or establish your own legal entity, which can be costly and complex. Partnering with an EOR is the optimal solution, enabling you to access global talent swiftly while saving costs, time, and effort associated with legal and administrative setups.

Q. Can an employer of record service help with onboarding and offboarding employees?

Yes! Some EOR services, such as Multiplier’s, include expert assistance with both onboarding and offboarding processes, ensuring full compliance with local regulations. From initial documentation to smooth transitions, we support your workforce management needs every step of the way.

Q. How does an employer of record service handle employee benefits and insurance?

With a dedicated team of experts well-versed in the evolving laws and regulations of various countries, our EOR platform ensures that your employee benefits and insurance packages comply with local requirements worldwide. We navigate the complexities of global benefits management, providing peace of mind that your workforce is well-cared for.

Q. How does an employer of record solution stay updated on changing labor laws and regulations globally?

Our EOR solution boasts an expert legal compliance team dedicated to continuous research and updates on labor laws and regulations globally. By staying ahead of regulatory changes, we ensure that our clients remain fully compliant with evolving requirements across different jurisdictions.