Employer of Record Company | EOR Services in India
An employer of record is an organization that serves as the employer for tax purposes while the employee performs work at a different company. The employer of record takes on the responsibility of traditional employment tasks and liabilities. By using an employer of record, recruiters and other businesses can free up time. Not having to deal with payroll and HR issues can potentially save hours.
A global employer of record service provider has already done the often costly and work of setting up entities around the world ensuring all banking, insurance, tax, HR, facilities and contract requirements are met and it has the local infrastructure in place to employ and pay local workers. An employer of record service company is a cost effective way to outsource payroll and HR functions. The business pays the employer of record a set rate for every hour the employee works, and the employer of record handles all tasks.
Employer of record services can be especially helpful when dealing with payroll processing and employment laws for employees in multiple states. The employer of record stays updated on the state and local laws so you don’t have to worry about learning and complying with laws in multiple places.
BENEFITS OF HIRING AN EMPLOYER OF RECORD SERVICES
Collaborating with EOR service vendors is a common place practice for global companies. Reaching out to a company that can become an intermediary between a business located in a different country and the local government helps business owners mitigate risks, reduce management costs, and improve team efficiency.
Remove global market entry barriers
Although building teams abroad has a ton of benefits (affordable workforce, larger talent pool, workplace diversity), a lot of business owners are wary of looking for talent abroad because of the challenges that come along with registering a business entity abroad.
In countries with a high level of bureaucracy waiting for the embassy’s approval to start business activities abroad can take months. All this time, business owners are in an undefined state, unsure whether they should keep trying to break in or focus on hiring talent at home and give up on a global office.
Comply with local laws
The cases of expensive law suits caused by not knowing local trade and labor laws are common among international businesses. For example, European companies oblige employers to give female team mates a 14 week maternity leave. Since there are no such requirements in the United States, an American business owner can get himself in a legal pickle because they were not aware of the nuances of EU legislation.
Save time
Keeping track of paperwork, administering benefits, Payroll outsourcing, and terminating employee contracts takes a lot of time. Trying to juggle dozens of management tasks on their own, business owners end up not spending enough time on the company’s core activities improving the product, building strategies, and fostering meaningful connections with clients or partners. By collaborating with an EOR, business owners can improve their skills in areas they are passionate about and skilled in rather than spending hours researching international laws and procedures.
Reduce risks
Hiring an employer of record company is a way for business owners to shift the burden of responsibility off the organization and on to a vendor. Since the employer of record is the one featured in the official documentation, drafting agreements, and paying taxes, the organization will be the one to take the fall should something go wrong. Thus, by hiring an EOR, a business owner does not have to worry about the consequences of accidental tax documentation negligence or non-compliance with local labor laws.
Reduce costs of setting up office
A lot of costs are associated with opening an office in India. From the expenses related to establishing a subsidiary to hiring legal and financial assistants, building a team abroad from scratch ends up costing company owners.