Yes, but you must either establish your own legal entity in the country or hire workers as contractors. Each strategy has its own benefits and drawbacks.

If you establish a legal entity, you'll have to manage your presence in the country, including hiring lawyers, payroll specialists, benefits administrators, and other professionals. This is practical if you're hiring hundreds of people, but for smaller numbers (even a few dozen), an EOR is more cost-effective.

Hiring contractors requires caution. International contractor misclassification is a serious issue that can result in hefty fines and penalties. An EOR helps avoid these risks by making workers full employees.

An Employer of Record, or EOR, is a company that legally employs workers on behalf of another business.

It’s important to understand that EORs vary significantly in their operations. For instance, some EORs, like Remote, own legal entities in each country they work in. In contrast, others function as intermediaries and don't own any entities. Some EORs use a combination of their own entities and partner entities. It’s essential to select an EOR that meets your employment compliance needs in the countries where you want to hire.

A Professional Employer Organization (PEO) does not typically hire or employ workers directly. Instead, an Employer of Record (EOR) takes on the role of hiring employees on behalf of your business in various countries. PEOs often provide “co-employment” services, handling payroll, benefits, and other HR tasks, while the company retains control over other responsibilities. If you need to hire in a country where you do not have a legal entity, an EOR is necessary. Using a PEO usually requires that your company has a legal entity in any country where you employ workers.

In simple terms: if you want to hire someone in a country where you lack a legal entity, you will need an EOR. If you need assistance with HR tasks such as payroll and benefits in a country where you already have a legal entity, a PEO could be beneficial. Essentially, a PEO offers some similar services to an EOR but does not handle the legal employment aspect.

Explore the differences between an EOR and a PEO for more detailed information.

Employer of Record (EOR) costs can be structured either as a flat fee or a percentage of the employee's salary. Flat fees are consistent per employee, no matter their position or compensation. Percentage-based models vary, with the fee being a portion of the employee's salary, which can cause fluctuations.

Be cautious of percentage-based pricing. Employment costs globally can differ widely, but a trustworthy EOR will account for these differences and provide a clear upfront cost. Percentage models may push companies to lower salaries to reduce costs, benefitting third-party providers more.

Remote’s EOR service is priced at $599 per month if billed annually, or $699 per month if billed monthly. There are no hidden fees, minimums, long-term contracts, or exclusivity agreements. Pick the plan that best fits your team’s needs. Check our pricing page to see how simple and affordable it is to grow your international team.

An Employer of Record (EOR) primarily acts as the legal employer for your employees in other countries, shielding your company from liability and compliance risks by hiring workers legally on your behalf.

The EOR also handles complex HR tasks associated with hiring international workers. Every country has different regulations for pay schedules, permissible currencies, required paid leave, and more. EORs take care of these complexities, allowing you to spend less time on administration and more time on expanding your team and growing your business.

Crucially, an EOR does not manage the day-to-day tasks or performance of your employees. You work with employees hired through an EOR in the same way you work with your direct employees. The only difference is who handles the administrative paperwork.

An Employer of Record (EOR) is a third-party service that legally takes on the role of employer for your staff in other countries. The EOR manages several administrative duties, including payroll for employees abroad. When you employ someone internationally through an EOR, you provide the necessary funds to the EOR, which then handles salary distribution, tax withholdings, social security contributions, and pension management.

Using an EOR allows you to deal with the complexities of international payroll while staying compliant with local laws. This means you can hire employees in other countries without becoming an expert in their payroll systems. Simply find the right person for the job, and let the EOR manage the rest.

When comparing Employer of Record (EOR) services, it's essential to look at the number of countries where they provide direct services, the scope of global HR solutions they offer (such as payroll, benefits administration, onboarding, and local taxes), and how well they ensure local compliance. The quality of their user interface should also be a consideration.

Make sure you work with an EOR that owns its own local entity in the country where you plan to hire. If they don't, you might find your employees managed by an unknown third party, leading to potential issues with oversight and service quality.

Additionally, your EOR should provide strong protections for your intellectual property. Without these protections, you could face difficult legal disputes over IP ownership in various countries.

Consider asking the following questions:

• Do you own an entity in this country, or do you outsource employment and compliance to a third party?

• What measures do you take to protect intellectual property and invention rights here?

• Is employee data shared with any third parties?

• Do you keep all employee documentation in a central, accessible location?

Remote owns all our entities, offers exceptional IP protections and data security, and provides state-of-the-art global employment software to meet your needs.

Engaging an Employer of Record (EOR) is absolutely legal in most countries. However, for the best legal adherence, select EORs that have established their own entities in the countries where you want to hire staff.

Before you start working with an EOR, verify that they own a local entity and have the necessary knowledge to handle localized payroll, health benefits, taxes, and any other compensation like stock options. This ensures that your employment practices are legally compliant and well-managed.