How do EOR services work?

Employer of Record (EOR) services: How do they work?

When expanding into a new market, businesses face the complex challenge of managing their workforce in compliance with local laws and regulations. Employer of Record (EOR) services offer a strategic solution to this challenge, by acting as the legal employer of workers on behalf of the businesses. This article will help explore how EOR services work and how they can simplify and streamline the employment processes for businesses operating globally.

White collar male office worker of an EOR services provider supports Client's companies with tax calculations via EOR services

To be able to hire workers, employers are required in many countries to have a local entity, such as a foreign subsidiary. This can be a costly and time-consuming process, though. Fortunately, there is an alternative solution: EOR services.

EOR stands for Employer of Record, a service that acts as the legal employer of your workers on your behalf. By using EOR services, you can avoid the hassle of establishing a local presence and focus on your core business activities.

EOR services providers have expert knowledge and are acquainted with local employment regulations. They can ensure compliance while taking care of a wide scope of work of hiring workers in other countries, such as:

•Recruiting

•Labor contract

•Onboarding process (including business visa/work permit and residence card)

•Payrolling

•Health Insurance & Social Insurance

•Personal income tax (PIT) compliance

•Employee relation management

What types of EOR contracts are there?

There are two main types of contracts you should be aware of when using EOR services.

1. The employment contract

A compliant employment contract is signed between the EOR and the employee, which outlines the terms and conditions of their employment, such as their salary, remuneration package and responsibilities. As a result, the EOR services assume legal liability for the employee in accordance with local laws and act as their employer of record.

2. The service agreement

The service agreement is a contract signed by the EOR services provider and its client - your company. It defines the scope and terms of the EOR services, such as fees, duration and termination clauses. The service agreement also specifies the relationship the enterprise has with the employee and the EOR services provider. As the terms in the service agreement are sometimes confused, you can ask your EOR services provider to clarify them before signing it.

White collar mixed workers of a Foreign direct invested company and EOR services provider shake hands and sign an EOR service agreement

Who do the employees work for?

The staff are employees of your EOR services provider (as they are engaged in employment contracts). The EOR services provider handles all the details relating to salary calculation and payment, insurance submission, and other employee relation tasks.

Although your international employees are legally employed by the EOR services provider, they are functionally part of your company. Your company has full control over their daily tasks, scope of work, projects, meetings, KPIs and so on, just like you do with your domestic staff.

Mixed white-collar workers including EOR employees discuss project scope of work daily tasks in an EOR services provider company office city building

Why Manpower Vietnam's EOR services?

Employer of Record services from Manpower Vietnam offer you the most cost-effective, scalable, and secure way to hiring employees in other countries. We prioritize transparency at every stage and provide you with full control over the EOR process. You manage your team members employed through EOR services the same way you manage other employees – leading and directing them, and we can ensure that they are compliant and satisfied with their employment.

Our advanced platform ensures that you can seamlessly pay your employees in their preferred local currency. Furthermore, our streamlined payroll process eliminates errors and delays, guaranteeing accurate and timely compensation for your employees. You will get to experience the benefits of transparency, control, and an error-free payroll process through our platform.

In addition to EOR services, ManpowerGroup Vietnam also provides a wide range of services and flexible solutions to meet the requirements of businesses, such as permanent recruitment, headhunting services, staffing, labor outsourcing, outplacement, payroll, RPO, HR consulting, and more.

Read more about our EOR Services. To explore other innovative HR/workforce solutions of ManpowerGroup Vietnam, reach out to Our Services page or input your contact information in the form below and we will get back to you soonest.

Employer of Record (EOR) services: How do they work?

​Employer of Record (EOR) services: How do they work?

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