What is a Contractor of Record (COR) and how does it work?

Working with international contractors can unlock incredible opportunities for businesses seeking to scale and access global talent. 

However, managing contractors while ensuring compliance with local laws and mitigating legal risks can be a daunting challenge. 

That’s where a Contractor of Record (COR) can make your life easier.

This article explains the concept of COR, its benefits, and why it can be a game-changer for businesses aiming to grow globally.

What is a Contractor of Record (COR)?

A Contractor of Record (COR) provides specific services and deliverables to customers, while handling the legal, administrative, and compliance responsibilities associated with managing and paying contractors to complete these services.

A COR is the official entity responsible for managing contractors, ensuring that businesses can engage contractors in different countries without violating local labor laws, while reducing their contractor misclassification risks.

By partnering with a COR, businesses can focus on their core operations while the COR handles compliance, payments, and other administrative tasks required to manage contractors legally and efficiently.

How does a Contractor of Record work?

A COR operates as a service provider for a company who wants to work with contractors. Here are some key tasks that can be handled by a COR. 

Contractor onboarding: A COR streamlines the onboarding process by managing all necessary documentation, including localized contracts that comply with local labor laws.

Compliance management: A COR ensures that contractors are classified correctly according to local laws, mitigating the risk of legal disputes over misclassification.

Payment processing: A COR handles payments to contractors, supporting multiple currencies, bulk payments, and even cryptocurrency making contractor payments timely and accurate.

Administrative tasks: A COR manages compliance reporting, and other administrative workflows, reducing the burden on businesses.

Intellectual property (IP) protection. A COR facilitates the transfer of IP, ensuring businesses retain ownership of work created by contractors.

Offboarding contractors. When the engagement ends, the COR ensures a smooth and compliant offboarding process, handling final payments and legal formalities.

How can companies benefit from using a Contractor of Record?

1. Risk mitigation and legal protection

One of the most significant challenges in managing contractors globally is ensuring compliance with local labor laws and avoiding contractor misclassification. Misclassifying a contractor can lead to costly legal disputes, fines, and reputational damage.

A COR minimizes contractor misclassification from day one, protecting businesses from these risks. By eliminating legal exposure, companies can engage contractors confidently, knowing they are fully compliant with local regulations.

2. Streamlined administrative workflows

Managing contractors across borders often involves complex administrative tasks, from invoice management to compliance reporting. A COR takes over these responsibilities, allowing businesses to focus on growth rather than administrative burdens.

For example, Remote’s Contractor of Record service provides a contractor classification assessment, certain tax filings, and compliance tasks, ensuring businesses operate smoothly without navigating local legal complexities.

3. Faster global expansion

Expanding into new markets can be time-consuming and resource-intensive, especially when navigating unfamiliar legal landscapes. A COR simplifies this process, enabling businesses to quickly engage contractors in multiple countries.

Remote’s COR supports payments in over 70 local currencies, multiple payment methods, and even cryptocurrency. This flexibility makes global expansion seamless and compliant, empowering businesses to access top talent wherever it’s located.

4. Simplified payments and tax compliance

A COR handles all contractor payments, ensuring accuracy and timeliness while complying with local tax laws. With options for bulk payments and varied currencies, businesses can manage contractor payments efficiently, regardless of location.

5. IP protection

When working with contractors, ensuring ownership of intellectual property (IP) is crucial. A COR facilitates the transfer of IP, protecting businesses from disputes and ensuring they retain ownership of all work produced by contractors providing them services.

6. Peace of mind with end-to-end support

From onboarding to offboarding, a COR provides comprehensive support throughout the contractor lifecycle. Businesses gain peace of mind knowing their contractors are managed professionally and compliantly.

Who should use a Contractor of Record?

A COR is ideal for businesses that:

• Work with contractors in multiple countries.

• Seek to mitigate legal and compliance risks while managing contractors.

• Need to streamline contractor administration, payments, and onboarding.

• Want to expand globally without setting up local entities.

• Require a seamless IP transfer for contractor-created work.

Why choose Remote Contractor of Record?

Remote’s Contractor of Record service stands out as a comprehensive solution for businesses managing global contractors. 

Here’s why:

• Minimize legal exposure: Remote assumes liability for contractor classification, providing unmatched protection from misclassification risks.

• Comprehensive administrative support: Remote handles tax filings, compliance reporting, onboarding, payments, and offboarding.

• Localized contracts: Remote provides standardized contracts tailored to local labor laws, ensuring seamless compliance.

• Global payment flexibility: Support for over 70 currencies, bulk payments, and cryptocurrency simplifies payments to contractors worldwide.

• IP transfer protection: Remote facilitates IP agreements, ensuring businesses retain ownership of all work produced.

• Seamless global expansion: Remote’s COR service empowers businesses to expand quickly, accessing top talent without navigating compliance hurdles.

Onboard and pay contractors easily with Remote

Working with contractors allows growing companies to gain flexibility, access specialized skills, and reduce costs, allowing them to scale quickly and focus on core priorities without long-term commitments.

If you don't want to deal with the hassle of managing contractors, onboarding, and paying them yourself, a COR can be ideal for your business needs — a turnkey solution for engaging with contractors efficiently and compliantly.

Remote’s Contractor of Record service takes this a step further by offering end-to-end support, from onboarding and compliance to payments and IP protection. Whether you’re a startup looking to expand globally or an established business seeking to streamline contractor management, Remote’s COR service delivers the tools and peace of mind you need to thrive in today’s distributed workforce.

Ready to simplify your global contractor management? Learn more about Remote’s Contractor of Record service and get started today!