Streamlining Business Operations with an Employer of Record

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Atlas Team

Atlas helps innovative companies like yours to expand, onboard, manage and pay international teams in 160+ countries.

Published: 08 Sep 2023

Want to pursue global expansion? An Employer of Record shoulders the administrative burdens of going global so you can focus on growing your business.   

Trying to pursue global expansion without the right business operations in place is like climbing a ladder with broken rungs — it’s near impossible. 

Analogies aside, what exactly keeps businesses from achieving their global ambitions? It’s typically because they don’t know how to navigate legal and regulatory compliance, hiring and managing a global team, local employment laws, setting up local entities, payroll and tax compliance, etc. 

The list goes on and on… 

However, an Employer of Record (EOR) provider makes it easy to sidestep the administrative hurdles of global expansion so you can focus on growing your business. Here’s how an EOR provider can help you streamline your operations and take your business international.  

What is an Employer of Record? 

An EOR service provider allows an organization to hire employees in a country or jurisdiction where they don’t have an existing establishment. The EOR acts as the legal employer of the worker or workers in question, assuming responsibility for the integration and induction of employees, release and termination of employees, and payroll on the client’s behalf.  

As the employer, the EOR partner manages the legal, HR, tax, and local compliance needs for the workers as its own employees, while the client organization maintains full control of their day-to-day work.  

So, what are the benefits of utilising an EOR? 

The most notable benefit of partnering with an EOR is the reduced administrative overhead.  

Outsourcing your payroll, HR, and other logistical tasks to an Employer of Record leads to huge cost and time savings for your business. Depending on the country, setting up a subsidiary can cost several thousands of dollars (plus capital requirements) and take several months to complete. However, an Employer of Record eliminates the need to set up a local office or subsidiary to hire talent in a new market — they’ll handle the entire process end-to-end on your behalf. 

The other main benefit of an EOR is mitigating compliance risks. 

Each country, and often regions within countries, have their own labor laws and regulations. An EOR specializes in understanding these legal nuances. They ensure that employment practices, from hiring to termination, are in line with local legislation, protecting your business from potential legal pitfalls, long-term reputational damage, and hefty fines. 

Streamlining Costs Through an EOR Service Provider 

Cost management and containment are high on the list of priorities for all workers at the moment.  

The uncertainty that runs through almost all international and domestic markets has meant that companies are tightening their belts and remaining cautious on spending and growth plans for the time being. But there is a great need for highly skilled talent and maintaining growth. Also, despite the lurking shadow of possible recession, organizations and investors remain optimistic about the term near future.  

“Over the next 12 months, I think there’s real optimism that we’re going to put a lot of this uncertainty behind us.” 

— Chris Cavanagh, Guidepost Growth Equity 

So how do organizations manage the seemingly conflicting priorities of cost management and maintaining growth?  

HR Strategy: How Companies Grow on a Tight Budget 

Business leaders who see growth opportunities are now looking to their HR leaders to help solve issues. In their relatively recent move to executive leadership, HR professionals are spending more time on strategy to build workforces that focus not only on employee satisfaction and productivity, but on meeting growth and profit goals.  

As part of this HR strategy, HR leaders need to offer solutions that support operational capability but, in our current economic climate, that account for tighter hiring budgets than the past few years.  

Expanding Without a Business Establishment  

A common tactic for moving into new markets is setting up a new legal establishment. But this option comes with financial and legal risks as well as compliance hurdles that can be costly and time-consuming. 

Depending on the country, a company may have to hire a local professional to register the new local establishment branch, deal with multiple government agencies, lengthy approval periods and unpredictable delays, translate and notarize integrated documents even at the parent company level, prepare board resolutions, hire a local manager or company representative, or lease office space.  

Once a subsidiary or branch office is ready to operate, it must then comply with local labor laws, visa and immigration laws, tax laws, data and privacy laws, financial accounting rules, and corporate maintenance laws. The potential for liability in a new country is broad, and the company must pay local advisors to navigate the literal foreign legal landscape and ensure compliance.  

In recent surveying, Atlas found that keeping track of changing regulations across multiple jurisdictions is particularly challenging for companies (63%) when staying up to date with evolving employment regulations and HR policies.  

In addition to this, three in five (60%) of the international organizations surveyed also found it particularly challenging to ensure compliance with local regulations.  

A flexible future of work strategy would consider partnering with an EOR when exploring new markets. An EOR can also get people hired fast to provide services to eager customers in a new country.  

An HR strategy that embraces EOR services can drive operational capability effectively and at a low cost. In today’s economic climate, an HR department that knows how to leverage EOR services can be invaluable to the business. 

What to Look for in an Employer of Record (EOR) 

According to the Everest Group, the key elements that will differentiate EOR providers going forward are:  

  • Country coverage  

  • Responsiveness  

  • Sophisticated technology platforms with a user-friendly interface  

  • Pricing  

  • Flexibility in benefits 

As your business looks to expand globally, partnering with an EOR that differentiates itself across these areas is crucial. For example, Atlas enables you to hire, onboard, manage compliance & pay global talent in over 160 countries — with competitive pricing to meet your business’s needs. 

An Employer of Record isn’t just an extension of your HR team, it’s a strategic partner, unlocking avenues for growth, compliance, and efficiency in your business. At Atlas, we manage the employee lifecycle, from onboarding your team to processing payroll, so that you can focus on what you do best — growing your business. 

Find out more about how Employer of Record services are transforming the future of work by downloading Atlas' Global Employer of Record Report: 2023. 

In this, you'll learn about: 

  • The Changing Dynamics of the Global Talent Landscape: Understand the forces driving change and how businesses can adapt. 

  • The Rise of Remote and Hybrid Work Models: Discover the benefits and challenges of these models and how to manage them effectively. 

  • The Role of Employer of Record (EOR) Services: Learn how EOR services can streamline your business operations and ensure compliance. 

  • What’s Coming Next: Forecasting the major trends and technologies that will define the next 12 months.  

Download the report, for free, by filling out the form below.