GEM Webinar: Navigating the World of Global Employment: Employer of Record Explained

August 2, 2023

Gain insight into the core functions of an Employer of Record (EOR)  with the first part of Airswift's global mobility (GEM) webinar. This session delves deep into the ever-expanding realm of international work opportunities. 

Featuring, Ian Wilkinson  (Sales Director, GEM - Airswift) and Holly Navarro (Engagement Manager, GEM - Airswift)  this webinar explores the depths of Employer of Record and uncovers the multitude of benefits that come with partnering with an EOR and how it can become a powerful asset for businesses aspiring to conquer new territories overseas.

Discover the keys to unlocking success on the international stage as we explore the responsibilities and capabilities that an Employer of Record brings to the table. Whether you're an ambitious startup eyeing global expansion or an established enterprise seeking to broaden your horizons, this webinar holds invaluable insights that will propel your ventures to new heights.

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What is an Employer of Record?

"Simply put, an Employer of Record is an organisation that serves as the legal employer for workers on behalf of another company. This allows businesses to hire overseas or abroad without the need to have a physical local entity" 

An Employer of Record is a third-party organisation that serves as the legal employer for workers on behalf of another company, particularly for international hires.

This enables businesses to employ full-time workers abroad without the need to establish their own legal entity in a foreign country, a process that can be costly and time-consuming.

By adopting the EOR model, businesses can navigate global employment with ease, ensuring compliance with local laws and regulations while also managing tasks such as visa handling, payroll processing, tax deductions, benefits administration, and compliance with tax regulations.


What are the key benefits of hiring an Employer of Record? 

Hiring an EOR  provides businesses with several significant benefits.

Firstly, it offers an effective solution for global expansion, allowing businesses to employ local workers in new regions without the administrative and legal complexities of setting up their own entity. This leads to considerable cost and time savings, as establishing a new entity can be costly and take months to complete.

Secondly, an EOR offers scalability, enabling companies to adjust their workforce size in response to business needs without the burden of handling the legalities and administration involved in hiring and terminating employees.

Lastly, an EOR allows businesses to legally employ remote workers, ensuring compliance with local rules and regulations and reducing legal risks associated with worker misclassification. Thus, an EOR serves as a cost-effective, flexible, and compliant solution for businesses looking to expand their workforce globally.

Employer of Record core services

Airswift EOR services

Accelerate your market entry strategy

With the assistance of an Employer of Record, businesses can catapult their expansion into untapped markets. EORs possess the ability to establish a company's footprint in a foreign territory within a mere two days, assuming the role of the legal employer for all international hires. This empowers organisations to attract and secure top-tier global talent, while also capitalising on emerging market opportunities.

Working with an Employer of Record is convenient

The Employer of Record solutions offered by Airswift furnishes corporations with enhanced flexibility. This service allows companies to trial new markets or initiate short-term projects without the need to establish a physical presence overseas. This is particularly beneficial for smaller businesses lacking the necessary infrastructure to manage local payroll, immigration, and tax obligations.

An EOR equips a business with a legal entity capable of managing these commitments, complete with the expertise to ensure full compliance with the host country's laws and regulations.

It is cost-effective

An EOR  enables businesses to avoid the overheads associated with setting up and maintaining a foreign operation. From acquiring international talent to keeping up with compliance issues, an Employer of Record permits businesses to streamline their cash flow and focus these resources on enhancing their growth strategies.

It can minimise risk 

An Employer of Record assists in mitigating the liabilities associated with international hiring and operations. Responsibilities related to employee benefits, payroll and taxation, administrative operations, and compliance are assumed by the EOR, thereby protecting companies from risks associated with the mismanagement of these matters. Collaborating with skilled and seasoned EOR service providers assures clients that these obligations are being expertly handled.


Are there any restrictions?

We say internally that an EOR is industry agnostic. It can be utilised across all industries and all sectors where a company needs to engage with workers in a different country where they don't have an entity or need employment-related administrative tasks.

What are the responsibilities of an Employer of Record?

The responsibilities of an Employer of Record are multifaceted and typically vary by country, whilst also being tailored to the client's specific requirements. A fundamental duty of an EoR is managing visas in the designated country, ensuring all legalities of employment are adhered to. This includes payroll processing, calculating wages, deducting taxes, and issuing paychecks.

Furthermore, they administer benefits such as health insurance, retirement plans, and other employee and statutory benefits. An EOR also ensures tax compliance with local and regional regulations.

Beyond these, the EOR often handles a substantial portion of HR support, from the issuance of employment contracts and onboarding processes to managing employee inquiries, leave policies, disciplinary issues, and general on-site employee support matters. Finally, the EOR guides the client through local employment regulations, providing crucial labour market insights and compliance requirements.

Striking a balance between utilising an Employer of Record and maintaining some services in-house

To strike a perfect balance, careful planning, and strategic decision-making are essential. Companies must start by recognising the core and non-core aspects of their business. Core functions, such as product development and strategy formulation, which are vital to the brand's identity, should be kept in-house to maintain control and preserve the business's unique value proposition.

On the other hand, non-core functions like payroll, tax compliance, or HR administration—particularly for international operations—can be effectively outsourced to an EOR.

By entrusting administrative tasks to the EOR, businesses can concentrate on their core competencies, allowing for increased focus and efficiency. This arrangement not only reduces overhead costs but also guarantees compliance with local regulations. Regular reviews and adjustments ensure that the partnership remains adaptable and aligned with the ever-evolving needs and objectives of the business.

If you have any questions or are in need of expert guidance to determine if hiring an Employer of Record can benefit your business, don't hesitate to get in touch with us. We're here to provide the support and answers you need to make informed decisions and propel your business toward success.

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This post was written by: Tomás Battaglia, Content Marketing Coordinator