Introduction
The global business landscape has experienced rapid growth. After the world recovered from covid 19- pandemic, the dynamics of businesses changed. India is becoming a global hub for MNCs to expand their operations in the Asian market. As these large corporations are entering the Indian space, many are facing challenges to manage human resources effectively. PEO and EOR service providers are emerging as reliable employment partners to address the rising demand for human resource management.
Businesses face complex challenges related to employment and compliance when they enter new borders. That is where the Employer of Record (EOR) service provider comes into the picture. This third-party legal entity takes over the legal and administrative responsibilities of the client workforce.
An EOR service provider exposes a client company to a global network of professionals and resources. Thus, it helps companies with expansion plans to enter, adapt and establish themselves in new markets. Outsourcing HR services is the backbone of a successful business.
Let us read how Employers of Record service providers can help businesses to achieve their financial objectives.
What is EOR?
The term EOR stands for Employer of Record. The Employer of Record (EOR) is a third-party employee service provider. The EOR is an official employer that legally employs staff and outsources its services to different parent companies. EOR service provider manages various human resource, administrative, and legal needs.
When companies operate in multiple markets, they have to navigate through complex tax procedures. Established EOR service provider companies work with local legal HR experts. They prepare compliant contracts. These legal experts ensure all employment terms and conditions are drafted carefully in the agreement.
EOR acts as an official employer of the client business. By partnering with an EOR, client companies can streamline their human resource operations and focus on their core business activities. EOR is a legal entity of a client company.
It onboards and collaborates with employees without opening a physical entity in another country. EOR Services ensures such companies stay fully compliant with local labour laws.
EOR service providers employ qualified talent hired on behalf of the client by handling all legal employment requirements. Employer of Record signs an agreement with client companies to take over the complaint responsibilities associated with HR functions of the employer payroll, leaves, vacation, insurance, risk management, etc.
Companies these days are looking to overcome bureaucratic hurdles, complex legal workloads, and mandatory legal complaints. That is the reason why successful companies choose to join hands with an EOR service provider.
Once EOR provides stress-free and smooth HR functioning, companies get time to focus on improving their employee working experience. An Employer of Record (EOR) objective is to create a free room for management from HR operations to focus on growth and revenue-building strategies.
How can EOR Service Providers help businesses to grow and expand?
Companies are looking to grow and expand their operations in new markets. EOR service providers are emerging as HR teams of home country headquarters. EOR experts can handle everything related to onboarding and termination.
Companies are enjoying low-cost hiring, legal rights, and tax privileges of other countries by hiring these talented workforces through EOR service providers. More and more companies are outsourcing their human resource services in foreign countries from the EOR.
Read the below-mentioned benefits to understand its growing demand.
These outstanding advantages of partnering with an Employer of Record make them the first choice of SMEs and large corporations.
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Expand to new markets without a physical office.
EOR service providers help companies quickly establish their presence in new markets instead of investing resources or time in setting up a local office. Companies rely on the expertise of EOR teams to build infrastructure, draft labour compliance contracts, and create a seamless onboarding experience.
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Deep knowledge of foreign regulatory system
EOR service providers have in-depth knowledge of all the local laws and regulations. EOR ensures clients are compliant with local labour laws.
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Cost efficiency
One of the most significant advantages of an EOR service provider is that the client company saves time and cost. Employer of Record creates awareness among clients about unknown corporate fines. The information helps in avoiding penalties for not complying with local labour rules.
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Eliminates complexities and accelerates the hiring process
EORs have their registered business in the country of interest.
Such service providers simplify hiring, staffing, and termination procedures for a client company employment process in a foreign land.
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Performs thorough background checks
The Employer of Record service provider verifies information about potential candidates like working history, criminal records, medical records, references, credit records, court records, etc.
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Minimizing Risks
EOR service providers help minimize the risks of non-compliance for their clients.
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Handling Employee payroll and benefits
Payroll is the procedure of giving salaries to employees. If not diligently watched over, payroll procedures can create room for error.
EOR service provider offers a transparent system to untie its complex process. It assists the parent company in ensuring compliance and timely paychecks.
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Assists in Financial Planning
The Employer of Record help businesses estimate the cost of employment in a foreign country, draw long and short-term business budgeting and streamline staffing investment.
This help optimizes profits, investment, and hiring. It can also monitor the expansion period costs.
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Reducing workload by streamlining the HR process
Running a successful business is a time-consuming job. In this setup, talented employees need to meet revenue goals. Executive members in management often have too much on their platter.
Employer of Record is a lifesaver for them to meet tax, compliance, and employee hiring-related tasks. That is the way to share their workload and free up time for them to develop business strategies, work on innovative ideas, and have dedicated brainstorming sessions.
4 Best EOR Service Providers in India
In an era of digitization, globalization, and emerging hiring trends, PEO and EOR are becoming popular solutions. Companies are exploring options to outsource hiring employees and handling their recruitment procedures.
Hiring and managing employees from another country involves dealing with complex problems related to labour laws, bureaucratic procedures, and cultural differences.
It is a time-consuming, expensive, and risky decision for clients looking for overseas expansion. Organizations partner with expert EOR service providers who can simplify the HR process in such cases.
When selecting the top-notch Employer of Record in India, it is essential to consider factors like reputation, experience, customer support, etc. can define their true capabilities.
Below we have mentioned the crucial factors before choosing these four best EOR service providers in India. These key things will help you decide which EOR best fits your business. Some of the fundamental things to consider are:
- Reputation
- Experience
- Testimonials
- Support Services
- Flexibility
- Customization
- References
- Pricing Models
- Transparency
- Workforce Solutions
MME
MME is a global leader in offering Employer of Record solutions to companies seeking seamless and compliant approaches to managing their workforce. It is an umbrella company providing Professional Employer Organization (PEO) and Employer of Record (EOR) services.
MME has a vast network of HR experts, administrative tasks specialists, payroll, risk management, and compliant consultant teams. The management has provided personalized HR support to diverse industries.
MME offers end-to-end management for local and international clients. MME takes care of all employment duties. It begins from onboarding to the termination of the employee.
This three-decade-old experienced company, MME, has its headquarters in the capital city of New Delhi. MME has managed to capture a fair amount of market size in PEO and EOR operations in India of 15%. The company has extensive employee handling experience and highly recommended client testimonials. MME’s talented pool of employees has met a growing demand for industry experts.
In addition to its cutting-edge recruitment analytic technology, cloud computing, and automation tools for HR software, the company has bagged many fortune listed clients in its kitty for EOR operations.
The company’s human resource EOR management teams have offered cross-border transactions and global compliance to international parent companies.
The online portal of MME provides minute details about the company’s functioning and success. The transparent hiring process has made MME a favourite EOR service provider.
The extensive network of employees and deep understanding of the PEO and EOR industry makes MME the market leader. Companies looking forward to expanding their operations in India without establishing a legal entity choose MME as their first choice.
Global PEO
Global PEO is Asia leading PEO and EOR service provider offering employment solutions. They have been operating in India since 2017, with the headquarters in New Delhi. The Global PEO services include Professional Employer Organization (PEO), payroll, administrative benefits, Employer of record (EOR), hiring, and staffing services. It caters to a wide range of industries by outsourcing these functions on behalf of them.
Global PEO has been practising HR strategies to hire and retain a talented workforce. The company has provided executive-level employees to many reputed multinational companies. This company has provided PEO and EOR services to 500+ companies in more than 170 countries.
The company has invested in HR technology by providing high-end software for maintaining Employer of Record details like payrolls, leaves, reimbursements, tax deductions, employee benefits, insurance plans, etc. It creates a trusted partnership between the EOR service provider and the client company.
Global PEO specialized team on Employer of Record (EOR) has assisted companies in converting contractors into employees, offering compliant outsourcing solutions and providing interim hiring benefits. The flexible pricing and transparent contract terms make them ideal for businesses looking to establish a legal entity in India.
Global PEO company EOR model has enabled client companies to manage their extended workforce by minimizing risks and maximizing their overseas expansion plans.
Sky Executive
Sky Executive is a prominent EOR service provider that has catered to a wide range of industries with a proven track record. Based in Pune, the company has adhered to all the legal requirements of domestic and international labour laws and regulations.
Sky Executive EOR team has provided services to SMEs and large corporations of many Fortune-listed companies. These include companies from various industries across the healthcare, construction, manufacturing, and aviation sectors.
With their extensive network and expertise, the specialized team at Sky has assisted companies in managing their entire employee hiring cycle of the payroll and benefits administration.
Sky Executive offers customized EOR solutions addressing the specific requirements of a business. They have provided comprehensive HR support to all the clients. This includes statuary compliance, payroll management, and administrative benefits.
The highly recommended reviews and reliable testimonials of the clients make Sky Executive a global leader in EOR services. Companies seeking a seamless approach to streamline their business operations in a foreign land claim to receive end-to-end smooth HR support from EOR teams of Sky Executive.
Horizons
Horizon is a trusted name in EOR outsourcing services in India. Its diverse services are tailored to fit the unique needs of each company. This PEO and EOR organization ensures compliance. It provides comprehensive HR support to help companies to rely on an EOR service provider.
Horizons offer end-to-end services like hiring, payroll, employee benefits, work permits, compliance, risk management, talent acquisition, work permits, and visa documentation for employee relocation. These wide ranges of services and invaluable local expertise make them a top choice for large corporations.
Horizons focuses on cost efficiency and HR expertise. A decade of experience makes them a valuable partner as an EOR service provider looking to outsource their operations in India.
One of the strengths of Horizon is its technology-driven HR support for clients. The company has optimized workforce management strategies with the help of digitization of HR operations using cloud computing, IoT, automation tools, chatbots, artificial intelligence software, etc.
By providing digitally-driven solutions, Horizon has recently gained a market demand among SME and startup companies. These companies are looking to expand their operations under the EOR model.
Market Analysis and Insights to Prove EOR is the Futuristic Employment Tool
In the ever-evolving business landscape, hiring suitable candidates is vital for many companies to grow and focus on their core competencies. An area that has significantly gained the attention of startups and large corporations is outsourcing employment services.
By partnering with an EOR, businesses can navigate the intricacies of foreign labour laws, payroll management, tax compliance, employee benefits, insurance, and termination procedure. EOR signs a legal contract with two parties, an employee and the client company.
The renowned online portal Market Research recently released statistical data combining extensive qualitative and quantitative analysis.
It provides a holistic view and analysis of the market dynamics of the Employer of Record.
- The global Employer of Record market is projected to reach US $ 6602.64 million by 2028 at a CAGR of 6.8%.
- The global Employer of Record is expected to receive significant growth between 2023-2030.
- Global Employer of Record includes SMEs and large companies which 69.7% of SMEs have opted for EOR services.
- The key countries to use EOR services globally are North America and Canada. They occupy a 50% share of global EOR service providers.
- The top two companies occupy about 10% of the global EOR market.
- 83% of finance executives use trusted EOR service providers to relieve administrative burdens of overseas business expansion
Defining Key Responsibilities of EOR Service Providers
The Employer of Record service provider is registered as a legitimate employer of the parent company in a foreign country. Its key responsibilities are defined briefly below to give a fair idea about its operational roles.
- EOR service providers find qualified employees, hire new talent, and provide their employment services to a parent company in some other country without having a physical office in the local land of EOR providers.
- EOR service provider offers HR outsourcing services that include payroll and administrative benefits without the parent company having a legal entity in the foreign land.
- EOR service providers ensure compliance with local labour laws, tax legislation, and the country’s corporate policies.
- EOR service provider represents its office as the registered entity of the parent company.
- EOR service providers are solely responsible for hiring and staffing, taking complete care of insurance forms, drafting contracts, filing taxes, and handling severance and termination.
- EOR service providers offer HR consulting services in which they prepare work relocation permits and employee visa documents if the employee is required to shift to another location of the parent company.
- Without a management company in a foreign land, EOR service providers ensure workplace safety for employees. It establishes the company values and corporate culture embedded in local employees.
What is the difference between EOR and PEO?
To hire employees globally, a company needs to work with an employment partner who can handle the complete operations from hiring to termination of employees. An entire industry known as outsourcing employees exists to make life easier for domestic and international startups, SMEs, and large corporations.
Often people need clarification on Professional Employer Organization (PEO) with the Employer of Record (EOR) service providers. PEO and EOR companies both manage HR and administrative tasks. Thus many companies end up terminating them the same. But their core difference is based upon their functioning and hiring needs.
- As the name suggests, PEO is a Professional Employer Organization that manages employees of the company where you have a legal entity.
EOR is an Employer of Record company that formally employs the workforce of an international company legally that does not have a physical entity in the foreign country.
- A PEO is also known as a co-employer of the client who shares and holds all related liabilities and responsibilities of the client company. The company has a legal office present.
Whereas an EOR is a third-party employer that embraces employee responsibilities and liabilities. It is responsible for employing the best talent for the foreign company with only legal entities.
- In a PEO setup, services are provided to a company having a minimum number of employees of 5- 10 people.
In the EOR setup, the service provider has no minimum number of employee hiring involved.
How to Choose the Right Employer of Record for your business?
Are you looking to expand your business to new markets without investing in physical infrastructure?
Do you wish to hire services of the talented workforce of other countries by employing them but need to know which route to follow?
Invest in the right EOR service provider and invite new directions to your business.
Below we have listed prime indicators to be examined before choosing an EOR service provider for business operations.
Reputation and Experience
Before investing in an EOR service provider, it is essential to study their number of years of experience in the industry. Reputation and experience are vital indicators to know the credibility of an EOR service provider.
Always partner with the EOR, who has a proven track record. An experienced EOR should understand local labour laws, regulations, taxes, and compliance. This immense knowledge always helps clients in making sound decisions.
This knowledge also ensures a smooth and compliant employment decision for your business.
Clients Reviews and testimonials
Client testimonials provide valuable insights into the quality and range of services. A client company should reach out to the existing clients of EOR or can ask for references from the old clients.
This step helps to understand the responsiveness, professionalism, timeliness, and competencies of the EOR service provider. If any negative suggestion or complaint comes forward, kindly dig deeper into the context of the issue.
Compliance and legal considerations
Compliance with local laws should be considered before employing workers in a foreign land. Ensure that the EOR service provider has a comprehensive understanding of the legal employment structure of the country.
Assessing the chosen EOR accommodates your business’s unique requirements and needs and helps make informed decisions. Before partnering with an EOR service provider, request a formal contract, details of compliance procedure, employee benefits, and termination policy, and study them thoroughly.
Cost and Pricing Model
The cheapest is not the best. Price cannot be the sole factor in deciding the best EOR service provider. But yes, considering all pricing models do help to understand the market trends.
Some Employer of Record (EOR) service providers may charge a percentage of every employee’s salary or fixed monthly fees.
It is essential to evaluate the value provided by every EOR service provider. The client should ensure if later any additional fees or termination fees are charged by the EOR. It should be mentioned beforehand in the legal agreement.
Use of Technological assistance
The top EOR service providers offer modern technological assistance to their client companies. It is crucial to understand beforehand all the technical and reporting assistance the EOR service provider offers.
It includes social media hiring, mobile optimization, employee onboarding, and advanced database management systems. There is an inclusion of cloud computing, IoT, chatbots, automation tools, etc.
Access to date, time-saving, and latest HR software can save time and help businesses to make sound decisions.
Number of services offered by EOR
Every EOR service provider does not offer the same amount and the same kind of services. Consider the range of services and evaluate if they match your business needs. Some EORs are exclusively involved in the onboarding and onboarding of employees.
Other EORs provide a couple more services like tax benefits, insurance plans, HR consultants, administrative services, employee training, etc. A comprehensive group of services will offer a seamless employment experience to both employees and employers.
Bursting common myths about partnering with EOR Service Providers
Let us unmask some common misconceptions surrounding EOR and its services. Many employers have heard rumoured myths about the Employer of Record (EOR) service providers. We will burst these myths below.
My company will lose its data by partnering with the EOR service provider.
EOR provides complete security to organizational data. Employers of Record are responsible for making all HR-related decisions. They have no access to the company’s in-house data. They share their qualified employee data with clients and legally assure that the employees do not breach the code of ethics.
EOR cannot be used to hire executives for management
Employer of Record service providers helps in hiring for all possible roles and all vacant vacancies in an organization. PEO draws a competitive offer for professionals or high-level management staff looking for relocation or better growth with other companies.
The vast employee data and unimaginable networking of an EOR help clients hire the best staff for their foreign offices. EOR allows client companies to widen their talent pool by recruiting diverse candidates.
Partnering with EORs is Expensive
No, it is not. EOR and the client company sign a pricing agreement before venturing services. Except for the staple fee, EORs do not charge anything extra. Their services are worth the cost. A company makes a cost-effective decision by partnering with an EOR.
EOR saves clients from many undue fines, labour law compensations, and unwanted reparation that a company may not know. An Employer of the Record (EOR) follows two pricing models; a percentage pricing model or a flat one-time fee pricing model.
EOR involvement can affect employee working experience
Employers of Record are involved in hiring, training, payroll, insurance, and compliance management. Apart from this, the work experience relationship is exclusively between the client company and the employees. EOR streamline human resource operations and add a talent pool to its workforce.
It is a complicated process to hire an Employer of Record (EOR)
EOR service providers simplify the complete human resource procedure legally. They intelligently craft contracts according to the needs of the client. EOR manages and automates the entire employee journey. This simplification helps clients in overcoming many unknown challenges.
EOR is the same as outsourcing HR services from a staffing company
A third-party service provider who outsources its HR services is different from EOR. The factors that make EOR companies better than other outsourcing companies are its reliability, legal assurance, 24*7 customer support, legal terms of employment, and transparency.
Conclusion
Expanding business in India and hiring qualified candidates can be a daunting task for a company. A client company needs the right hiring expertise and legal HR support. Employer of Record service providers
EOR service providers have become invaluable support for businesses trying to expand their operations from or in India. With the growing demand for seamless outsourcing employment services, partnering with an EOR help companies navigate through challenging labour laws.
This article has summed up the role of an Employer of Record (EOR), factors to review before partnering with an EOR company, and the benefits of hiring an EOR. This information will help in aligning your business objectives with EOR services.
By fully considering all these elements, you can choose a trusted EOR partner for managing your workforce and ensuring complete compliance with local labour laws.
If you are ready to pave the way toward revenue growth, consider EOR service providers a reliable partner to help you achieve your mission. A successful international expansion will come with joining hands with an experienced Employer of Record company.
Are you ready to streamline your global expansion plan and understand the comprehensive Employer of Record services? Contact the MME office. We can support your business objectives and align them with our services.
