How to compare Employer of Record service providers

July 17, 2020

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Are you considering an Employer of Record (EOR) to outsource some or all of your Human Resources function? 

For many small to mid-size businesses experiencing growth, outsourcing can help with scaling but you want to choose the right solution. And like any product or service in the market, there is much to choose from!

So, how do you choose your employer of record partner?

The truth is that much of it will depend upon your unique situation. However, there are some common factors that should be thoroughly researched in order to select a partner that best suits your needs.

Here are five factors to consider when reviewing employer of record providers:

  1. Reputation
  2. Geographic experience
  3. Employee benefits offering
  4. Technology
  5. Servicing model

We have summarised some questions to ask in the below infographic. Click on the image to download a pdf version.

Read on to learn more about comparing Employer of Record service providers

choosing an employer of record

1. How reputable is the EOR?

First things first. How well established is the company?

Research their time in business and what their current client base looks like. Since a EOR will handle payroll and benefits administration for your company, you want to be sure that they are experienced in doing so to mitigate the risk of errors and compliance issues.

2. Does the EOR have global employment experience in your geographic area?

Processing employee payroll is an intricate process in which tax withholdings, insurance deductions, wage garnishments as well as sick and leave accrual must be calculated.

Be sure that the EOR you select has a track record of success in the geography in which you are doing business. Country, state and local tax laws and regulations vary by locality. Violation of such laws often carries the risk of civil penalties and fines.

Additionally, labor laws can vary depending upon location, so you’ll want to partner with an EOR who is familiar with international employment laws to ensure regulatory compliance.


3. What employee benefits does the EOR offer? 

One of the greatest advantages of working with an EOR is the employee benefits offering.

As they work with many businesses, EOR companies have greater buying power in the benefits market. This means that small business owners can offer their employees the types of benefits plans typically seen in larger organizations. Thus, you want to ensure that the EOR you choose offers benefits that would otherwise not be available to your employees.

Do they offer benefits in addition to the standard employment contract? For example, many EORs also offer life insurance, training and development and employee performance programs, among other benefits.   

4. What technology do they use?

Technology is an integral part of working with a EOR service, as it is used for employee onboarding, recording hours to process payroll and taxes, and ensuring compliance.

Ideally you want to have use of a system that easily integrates with your organization’s software and allows you to seamlessly manage the employee lifecycle. Request a demo so you’re able to determine how the user experience will work.

As you’ll be transmitting large quantities of sensitive data, you’ll also want to assess the security of their software to ensure your organization’s information remains safe.

Consulting Services-featured-image

5. What is the servicing model?

When assessing which provider might be the best partner for your organization, consider their servicing model.

Is it a one size fits all approach, or do they customize their model based on their clients’ needs? Do they primarily communicate through an online portal or would you be assigned a designated point of contact to whom you can escalate issues and consult with queries?

Another factor to consider is whether the service you’re interested in procuring is a core part of their business. Ideally, this would be the case as you’d receive the care and attention that you’d expect and deserve.

We can help you make the best decision for your business

When weighing which company to partner with for your Human Resources needs, assess a variety of factors to be sure that you’re selecting a solution that allows you to focus on what matters most - the growth and success of your business!

If you would like further advice on choosing the best approach for your business, contact one of our global employment experts.

Find out more about our Global Employment Outsourcing services

This post was written by: Liz Fiumara, Content Manager