Choose the Right Employer of Record Software

Mayank Bhutoria


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The allure of a global workforce is undeniable. Accessing a broader talent pool, diversifying skill sets, and expanding market reach are just a few benefits that beckon businesses to venture beyond their borders. However, navigating the complexities of international employment can quickly turn this exciting prospect into a logistical and regulatory minefield. This is where an employer of record software comes into play..

The EOR market is projected to reach USD 8045.3 million by 2031. With a growing number of EOR solutions on the market, choosing the right one can be a daunting task. Selecting the wrong EOR software can hinder your global ambitions and expose your business to significant financial and reputational risks. This blog post delves into the factors to consider when making this critical decision, along with highlighting the pitfalls of operating without an EOR partner.

Understanding the Employer of Record Software

At its core, EOR solution functions as a strategic partnership, empowering companies to hire and manage employees in countries lacking a legal entity. This partnership relieves the burden of establishing foreign subsidiaries, navigating intricate labor laws, and wrestling with localized tax regulations. 

An EOR software usually refers to EOR service providers who provide a SaaS platform to help employers automate contract generation, and simplify payroll, benefits and invoice processing. 

The EOR provider assumes the all legal liabilities of employing a foreign talent, meticulously handling crucial tasks like payroll processing, tax compliance, benefits administration, and adherence to local employment laws. The resultant advantage is a substantial saving of time, resources that might arise from a decentralized organizational structure.


What Businesses Are Missing Without EOR

Globally, all businesses are figuring out how to do more with less. This has led businesses to optimize their workforces, as maintaining an engaged workforce is its biggest expense.   With the cost of hiring in most labor markets increasing, businesses are turning to low-cost economies where cheaper talent can be found. 

In such circumstances, ignoring the potential of an EOR software can significantly hinder their growth. Consider the following roadblocks businesses face without effective EOR service:

Administrative hurdles

Establishing legal entities, navigating intricate labor laws, and complying with varying tax regulations can be overwhelming, requiring significant resources and diverting focus from core business activities.

Compliance catastrophe

Non-compliance with local employment laws can result in hefty fines, operational disruptions, and reputational damage, jeopardizing your brand and business continuity.

Limited talent pool

Geographic restrictions confine your talent pool, hindering your ability to access top performers and innovative minds across the globe.

Hidden costs

The expenses associated with setting up foreign subsidiaries and managing payroll internally can erode profit margins, impacting your bottom line.

How to Choose the Best Employer of Record Software

To overcome all the complexities mentioned above, choosing the EOR software that offers the best features is critical. Ask the right questions and look for solutions that offer

Ensure transparency

The cornerstone of a proficient EOR service resides in its transparency. Unambiguous communication concerning fees, service levels, and potential risks are fundamental prerequisites. The chosen EOR software must offer explicit details regarding the financial implications, service offerings, and risk assessment methodologies. This transparency instils confidence and cultivates a robust partnership between the business and the EOR service provider.

Check alignment with goals

Seeking an EOR solution that comprehensively understands the enterprise's expansion objectives is paramount. A symbiotic relationship between the EOR and the business requires a profound understanding of the company's aspirations. An EOR service tailored to these objectives ensures a strategic and synchronized approach towards international expansion.

Should offer Comprehensive Services

 Your EOR software must be a one-stop shop for  integrating payroll management, benefits administration, and must ensure stringent adherence to tax compliance regulations. The efficacy of the chosen software hinges on its capability to seamlessly incorporate these crucial services, ensuring operational efficiency and compliance with legal obligations.

Evaluate the cost-effectiveness

An informed evaluation of the pricing models, cost breakdowns, and elucidation of potential additional fees is indispensable. The employer of record services must present transparent pricing structures that align with the business's financial parameters. Clarity regarding additional charges ensures informed decision-making and mitigates unforeseen financial burdens.

Choose customization capabilities

The adaptability of the EOR software to cater to specific industry dynamics, workforce requisites, and geographical expansion plans is indispensable. Customization capabilities within the software amplify its efficacy by tailoring services to suit the business's unique demands, thereby enhancing operational efficiency and efficacy.

Know if they provide streamlined onboarding

Efficient onboarding processes, encompassing automated contract generation and streamlined administrative procedures, are pivotal attributes of a competent EOR software solution. These features significantly diminish administrative burdens, augment operational fluidity, and expedite the incorporation of new hires.


7 Mistakes Businesses Make While Choosing an Employer of Record Software

EOR software offers many benefits for global expansion. However, choosing the wrong EOR software provider can lead to significant challenges down the line. To avoid these pitfalls, avoid the following common mistakes while selecting the Employer of Record services:

  1. Being Aware Of  the EOR's Vendors and Partnerships 

When considering EOR software, it's essential to understand the internal structure of the provider. While many EORs claim to manage payroll in-house, some partner with other EORs to service clients in specific locations. This layered structure can create communication delays and accountability issues. To avoid this, thoroughly vet potential EORs and engage directly with the EOR's Client Service Managers (CSMs).

  1. Overlooking Client References and Reputation

Rely not solely on the EOR's marketing materials. Request and diligently review references from existing clients, especially those operating in your target market or industry. Seek feedback on the EOR's responsiveness, transparency, credibility, and reliability. Additionally, research the EOR's online reputation through industry forums and independent review platforms to understand the reliability of the EOR software or employer of record services.

  1. Neglecting Communication and Support

Effective communication is crucial for a successful EOR partnership. Evaluate the EOR's communication channels, response times, and the expertise offered by their support team. Ensure they have dedicated personnel familiar with the specific needs of your industry and target locations. This aspect plays a vital role in distinguishing a reliable EOR platform.

  1. Compromising on Security Standards

When considering EOR software, data security is paramount. Assess the EOR's security protocols, compliance with relevant data privacy regulations such as GDPR, and the strength of their IT infrastructure. Choosing a secure EOR solution is crucial to safeguarding payroll and employee information.

  1. Underestimating the Importance of Legal Compliance

Selecting an EOR that ensures compliance with local labor laws, tax regulations, and social security contributions across chosen jurisdictions is critical. Look for certifications and references to the EOR's legal compliance track record. This is a significant factor when choosing between EOR vs contractor services.

  1. Ignoring Scalability Considerations:

Your EOR solution should adapt seamlessly as your business expands. Choose an EOR that can scale its services to accommodate your future personnel needs, whether scaling up or down in specific locations. Scalability is an essential feature of an effective EOR platform.

  1. Overlooking Flexibility in Workforce Structures

If you want to build a diverse  workforce of permanent employees, freelancers and independent contractors, you would need an EOR solution that helps you with flexible contract types, employment structures, and accommodation for remote or freelance talent. Opt for an EOR solution that offers diverse employment options and can adapt to the evolving needs of your global team. 

Choosing the right EOR services for streamlined processes: Top 5 Picks

Best for Features Pros Cons Pricing
Gloroots Payroll in 150+ countries
Multi-currency support
Automated tax compliance
Employee self-service portal
Benefits administration
Automated employee contract generation
Faster onboarding and offboarding
Complete transparency on how the employer’s funds are managed.
One transaction per payment cycle.
Scalable solutions for growing companies
Competitive Pricing
Dedicated account manager
Suitable more for startups and small businesses Contractors $29 /contactor/month
Employees $299 /employee/month
RemoFirst Global payroll
Compliance support
Workforce management
Health insurance
International employee payments disbursed in local currency
Competitive Pricing
Sleek visually appealing UI
Limited range of HR services
May not be suitable for highly complex needs
$25/month for contractors
OysterHR Global payroll
Hiring guidelines
Benefits administration
Employee engagement tools
Intuitive and easy-to-navigate user interface
Discounts for refugees, nonprofits, and large teams
Responsive customer support with dedicated account managers
Integration options are limited
Benefits packages are offered as paid add-ons
Some delays in local currency payments
Contractor $29/month
Employee $599 per employee/month
Rippling Full suite HRIS including payroll
Benefits administration
Performance management
Expense management
Modern and intuitive interface
Streamlined workflows for all HR processes
Integration with other tools
Good scalability
Premium features aren't available worldwide
EOR is not available as a standalone product
Dedicated support isn’t available 24/7
From $8/user/month
(EOR pricing upon request)
Multiplier Global payroll
Tax compliance
Contractor payments
Expense & Leave Management
Flexible and scalable solutions
Dedicated account manager
Strong compliance expertise
Limited integrations
Lack of tailored options
Slow response time from the customer support team
EOR from $400/employee/month

Chart Your Global Success with the Right Employer of Record Software

Choosing the right EOR software by understanding your business needs. With the right choice, you can empower your global workforce, streamline operations, and navigate the intricacies of cross-border employment.

Don't let the complexities of international employment hinder your global ambitions. Start your journey with Gloroots and discover the best fit for your unique business needs. Manage your global workforce, automate your payroll, and reorganize your administration with us. Your ideal EOR partner to manage your international workforce.

Book a demo with us today and get personalized advice on how Gloroots can tailor our EOR solution to your specific needs.

Together, let's build a borderless future for your business.

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