Adding the right individuals to an organization and managing them expertly is never easy. These challenges become even greater when a company decides to expand overseas.

These issues may have dire consequences. They can slow down productivity and increase overall operational costs. Unfortunately, many attempts to provide lasting solutions to these issues are temporary at best.

The advent of Employer of Records (EOR) solutions comes with much cause for optimism.

EORs act as employers on behalf of a company. They share a significant portion of the risk and do most of the HR heavy lifting.

The role of an EOR transcends employee payroll and HR duties. They provide organizational solutions that can help companies reach unprecedented heights quickly. Here are some critical corporate problems that an Employer of Record can dissolve.

1. International Business Expansion

Working with an employer of record can help you get your international business expansion running sooner than expected. They cover all the basics for you.

Ideally, businesses must do due diligence before embarking on a high-stakes venture. Surveying the terrain and studying market trends are compulsory steps in the right direction. An EOR already has these important steps covered.

They know the best locations and highest qualification criteria for professionals in the region. They also understand the government’s role in preserving employees’ rights. With this information, they can help you kick-start your business operations in the ideal locations. EORs are especially recognized for helping foreign businesses set up shop quicker than usual.

2. Legal Troubles in Global Hiring

The challenge of starting a business in your home country pales in comparison to setting up a shop abroad. There are numerous hurdles to cross including culture shock, language barrier, and government influences on business development.

Filling out legal documents in a foreign language and learning employment laws are also major challenges. Consequently, many companies have lost their licenses and are in legal trouble with the overseas government.

Ignorance of these laws is no excuse. Some have ignorantly breached the misclassification of employee laws which many countries do not take lightly. The penalties for breaching them can be severe. While some countries only fine, others add a prison sentence and lifetime ban to the punishment.

An EOR’s influence can help you establish your presence abroad legally. It will also significantly lower the risk of exposure to harsh penalties when hiring globally.

3. Paying International Employees

EORs are a step ahead in ensuring that employees get their earnings on time. They have a network of global payment outlets specializing in paying remote workers. They also recognize the stress it takes foreign workers to receive their salary in foreign currency.

Upon getting paid, the money reduces after converting it to their local currencies. EORs ensure that this is different for hardworking remote workers. With an EOR in charge of payments, workers receive salaries in their local currencies. They also pay through some of the most widely used payment methods in the specific region.

4. Reducing Hiring Costs

Research shows that the cost of hiring a new employee can be up to four times their salary. For most companies, cutting costs while retaining a high level of productivity is crucial. Thanks to EORs, companies can hire permanent and temporary workers without breaking the bank.

Since EORs specialize in helping hire remote workers, they have a limitless portfolio of independent contractors. These individuals carry out their duties without being entitled to the additional benefits of permanent employment. Meanwhile, the EOR will be responsible for salary and benefits disbursements to permanent employees.

5. HR Burnout

Managing employees may be the most challenging responsibility for any professional. That’s why the Human Resources unit is crucial. Unfortunately, onboarding, training, paying, and replacing employees is a continuous cycle that can be burdensome for HR personnel. Leveraging AI for customer service can also streamline processes, allowing HR teams to focus on higher-value tasks.

As a result, HR professionals are usually prone to work-related stress, with over 83% experiencing burnout.

Working with an EOR can help boost staff morale and reduce work-related stress in your HR department. An EOR excels in HR responsibilities and can help with a chunk of the workload. Their collaboration with your in-house HR unit will help improve their productivity by providing an outside-in perspective on daily operations.

6. Hiring Temporary Staff

The need to fill a role temporarily may arise for various reasons. From parental leave to the sudden death of an employee, an establishment may need to hire a replacement short-term. This gives them time to find the best person for the role.

Sometimes, high demand for a company’s products or services may increase the workload of its staff. Thus, they may need an extra pair of hands to see out these periods. EORs solve this problem by carefully selecting skilled and vetted professionals from a pool of experts. They ensure that these individuals understand the nature and duration of their employment beforehand.

Conclusion

Partnering with an EOR can set you on the path toward achieving international expansion. You will no longer worry about the financial and legal risks of hiring and managing workers at home and abroad.

An EOR will hire, compensate, and replace employees under local employment laws. With an EOR doing the heavy lifting regarding HR and onboarding, you save hiring costs while maintaining high productivity standards.

Ensure you work with a renowned Employer of Record with an impressive track record for the best solutions. Let them handle your global hiring needs while you focus on taking your business to the next level.