What is an Employer of Record (EOR) Platform?
An Employer of Record (EOR) platform is an online portal where all the finer details of payroll, documentation and human resources (HR) compliance for global teams are securely housed and managed.
An EOR platform helps organisations oversee a number of processes, including employee onboarding – such as signing local employment contracts and agreements – payroll processing, and managing international employee benefits.
What are some of the functions an EOR platform could handle?
An EOR platform enables many of the processes overseen by human resources teams as they manage overseas employees.
Onboarding new employees
When new workers are hired, most companies begin a well-documented process of collecting important information from the employee, such as their personal details, contact information, banking details, employment contracts, and so on. As the legal employer, an Employer of Record needs to have this information in order to create contracts and pay salaries.
Depending on an employee’s country of residence and where the company is located, reviewing and signing additional employment policy documents may be required. A good EOR platform will have these documents stored and available for each country where it employs people.
Managing employment requirements and obligations
Employing workers in multiple countries requires being well-versed on employment laws and legislative changes in your employees’ local countries in order to ensure you remain compliant. And the higher the number of people you employ, the harder it becomes to stay on top of regulations in so many different places. No two sets of laws are alike.
An EOR platform makes it easy to find this information and stay updated on basic requirements and future modifications to tax codes, worker rights, benefit packages, and so on.
Employment contracts
When working with a global team, companies have to manage a number of local employment contracts and documents. No two countries are exactly alike when it comes to what benefits they require employers to provide and/or what rights must be protected and extended to employees. Some countries require that contracts include certain policies and agreements, and often, they have to be in the local language as well as your own.
An online EOR platform should facilitate contract reviews, signing, and secure storage. While every EOR will have its own functionality in-build, you should expect some form of a smart-populating template system that can help you set up employment contracts and agreements that meet requirements in most countries where you employ workers.
Identity verification
All workers are required to verify their identities when beginning a new job. An EOR platform should provide a verification system of some kind. An option could be connecting to a third-party tool that can assist with ensuring personal identity documents are indeed valid and match the personal information provided by a new hire.
Payroll processing and salary payments
As the legal local employer of workers abroad, an EOR manages the day-to-day payroll operations. This includes everything related to payroll processing, from calculating wages, making deductions, ensuring employees are paid, reporting, and remitting tax deductions to the appropriate authorities.
Providing employee payslips
Since the Employer of Record is the legal employer of the worker, they need to provide payslips every month. In many countries, this is a statutory employee right. The EOR platform is the easiest place for those payslips to ‘live’ as employees can easily access them and download them if they need or want them.
Workers should be easily able to access their payslips – extending as far back as they’ve been employed with the company – through an EOR employee portal and should never worry about being paid inaccurately. If they have any additional questions regarding the current pay period, they should be able to speak with the EOR directly through the platform.
This is valid regardless of where the employee resides and has their tax residency. Employers should abide by laws and requirements in their employees' local areas to remain compliant.
An EOR platform makes it easy for companies employing abroad to view the latest updates and information on tax codes in the employee’s specific jurisdiction.
Tracking paid time off (PTO) accrual and requests
Most countries have a statutory minimum regarding how much paid time off (PTO) workers are guaranteed. Some countries may also have strict regulations about how and when PTO is accrued. To recruit top talent, it’s common for individual organisations to offer generous PTO packages that extend beyond what is required by law.
If a country requires it, an EOR platform may help track PTO use, sick days, and other forms of leave across multiple borders as it relates to payroll. Generally, these things are managed directly by an in-house HR team or other group within the business. The EOR rarely has a hand in tracking or recording PTO unless it directly affects a worker’s salary. However, when compliance is concerned, the EOR may keep records of PTO.
Benefits
Every country requires employers to extend different benefits to workers by law, and benefit requirements vary drastically from country to country. An EOR platform can help you keep track of these variances by listing what statutory benefits must be provided in each country where you employ workers, as well as update you if and when there are any changes.
Additionally, because your EOR platform allows you to review payroll records, you can easily see what benefits you, as the employer, must cover, such as pension contributions in the UK, and ensure that they are properly added to your payroll records.
Finally, if the EOR is facilitating benefits through a stipend or other compensation plan, this can also be managed through the platform application.
Mandatory documents
There are certain documents that every country requires employers to keep on file, such as employment contracts, identity verification records, and right-to-work declarations.
Many countries also have additional specialised documents that employees are required to review and sign by law, such as the Workplace Violence and Harassment Policy for workers in Canada or the Fair Work Information Statement for workers in Australia.
In some cases, the EOR platform may provide a template your organisation can update and distribute to employees. In other cases, your EOR should be able to provide assistance on where to find the necessary information to craft your own country-required documents to present to your workers based on their country of residence. Whichever the case, a user-friendly EOR platform would provide accessl to these documents for signatures and storing.
Why is it important for an EOR to have its own digital platform?
A good EOR platform operates as a single source of truth: It makes onboarding, human resource-, and payroll-related tasks less tedious because all your records are securely transferred and stored in one centralised location, and payroll can be easily reviewed and approved. You have access to all relevant HR compliance and other employer obligation information in one easy-to-access place, ensuring you remain fully compliant and avoid crossing into grey areas of employment, such as employee misclassification.
Without an EOR platform, everything has to be tracked manually, often with spreadsheets or other documentation susceptible to errors. This is not only a big challenge but is prone to costly mistakes. Furthermore, a high-functioning EOR platform provides a secure and single place for in-app communication between HR or EOR teams and employees. This way, nothing gets lost in translation or amongst the shuffle of other day-to-day communications.
Streamline your online employee documentation processes with Boundless
Keeping hard copies of documents is outdated, takes up space, is less secure, and creates logistical headaches when you’re employing a global team. An EOR platform helps solve these problems and makes your organisation’s entire documentation system more efficient.
Speak to one of our experts to learn more about the Boundless EOR platform and how we can help you employ workers compliantly across borders.
