Employer of Record: Increase Business Effectiveness

Corporate Secretary Service Indonesia – Using an employer of record is one of the strategies foreign companies use to expand their business. The company does not need to form a legal entity in the destination country. Yes, employer of record services is a solution to increase the effectiveness and efficiency of the company while still complying with local country laws.

Understanding Employer of Record

An employer of record (EOR) is a company that has the right to hire employees. It is responsible for the employer’s duties (client). Usually, EOR services are used by companies that want to expand but need more time to take care of the obligations in each jurisdiction in which they wish to work. In other words, the EOR becomes the client company’s representative for recruiting, onboarding, paying and managing taxes, managing employees, and running their business operations.

The benefits of using employee of record services include:

1) Run compliance

Companies that want to expand do not need to worry about the laws in the local country because EOR will ensure the client’s business compliance according to regulations.

2) Effective process

EOR can facilitate faster entry into new countries and markets for businesses expanding internationally. EOR will handle legal compliance and hire new employees, so the client does not need to set up a legal entity there.

3) More efficient

A foreign company bringing its team to another country requires a large budget. On the other hand, setting up a business entity in a country can be costly. Suppose they use the services of an EOR. In that case, they will not handle the time-consuming and costly business needs, payroll, taxes, benefits, and HR tasks. The EOR will do these activities.

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4) More flexible recruitment process

EOR will recruit employees for client companies based on predetermined locations. This provides the flexibility to build a global team.

5) Scalability

EOR offers scalability for businesses growing or experiencing labour fluctuations, allowing them to quickly scale up or down as needed.

How Employer of Record Works

The employer-of-record business model originated in the United States in the 1960s. At that time, companies faced challenges when hiring people across multiple states. Since then, EOR has emerged and handled clients who expand their business to other states and countries. Many EOR companies are doing business globally.

What about employee status? To illustrate, here’s how EOR works:

• EOR will recruit workers so they become the legal employer of the employee.
• EOR is responsible for assigning job duties to employees, managing performance and other work-related matters
• EOR handles administrative and legal matters, including payroll, taxes, and benefits, to ensure compliance
• The global Employer of Record can handle employee visas and tax issues in the client’s destination country.
• Employees are responsible for carrying out tasks that the company has set.

Don’t worry about developing your business by setting up a company in Indonesia, because Portcorp is here as a solution for your business, also when you need Employer of Record. Portcorp is your comprehensive corporate secretary service in Indonesia. With our presence, you can get a dedicated company secretary to support you to what you need. Our company secretaries will track deadlines and file paperwork so your business keeps running smoothly. Contact us now on +6221-5020-8090 for your business succeed in the future!