What is an EOR vs. PEO?
Both PEOs and EORs are third-party providers that assist companies with HR, payroll and employment-related tasks. In the case of a PEO arrangement, it’s based on joint employment — i.e., both the third-party provider and the company have weight in certain business decisions: the third-party provider oversees HR and payroll-related decisions while the company is more responsible for the day-to-day tasks.
Meanwhile, in an EOR arrangement, the employer of record is the legal employer of the workers and takes on pretty much all the legal responsibility, giving the company opportunity to focus more on its core business.
Can I hire employees in other countries without an EOR?
To hire workers in other countries without an EOR, you can open a local entity, though this process tends to be a lot more complicated and gives you full legal liability if any problems occur.
In general, opening a local entity rather than partnering with an EOR is advisable when you are choosing to expand into the new country and looking to hire more workers.
Is an EOR a good solution for any country?
The answer is, it depends.
Generally, it’s easier to open EORs in countries with clearer labor laws and regulations. In other countries, though, the situation can be much more complex and EOR options may be limited.
What are the benefits of the aggregator model?
When deciding to work with an Employer of Record, there are generally two options – one option is to work directly with the EOR. The other option is the aggregator model, where you work with an EOR provider who, in turn, works with a network of ICPs in different countries.
The wholly owned EOR model has gained a reputation as being the more reliable model of the two. However, for the most part, this tends to be a myth.
The right EOR provider puts the resources into assembling the best possible ICP network and in that way can offer peace of mind for the company. Plus, in this arrangement, there’s the assurance that the third-party provider is always on your side in cases of dispute with the EOR.