What does an Employer of Record do?

January 30, 2024
Written by

An Employer of Record is like your business's behind-the-scenes superhero. They tackle all the complex stuff so you can focus on growing your business. They handle payroll, benefits, taxes, and even tricky things like compliance with local labor laws. It's their job to take care of your people, so you can take care of business. But what exactly does an Employer of Record do? Let's find out.

Key Responsibilities

Payroll Administration

Simply put, an Employer of Record takes the headache out of paying your employees. They make sure everyone gets paid on time, every time. And it's not just about handing out paychecks. They also handle all the tax deductions, benefits contributions, and other bits and bobs that go into a paycheck. So, instead of worrying about calculations and deadlines, you can focus on your business.

Tax Compliance

Navigating the maze of tax laws can be a real headache. That's where your Employer of Record comes in. They handle all the tricky business of making sure you're on the right side of tax payments and deductions. They do all the paperwork, meet all the deadlines, and keep you out of trouble. So, you can breathe easy knowing that your tax obligations are all taken care of.

Employment Contracts

When it comes to employment contracts, your Employer of Record has it covered. They make sure every 'i' is dotted and every 't' is crossed. They handle creating contracts, managing changes, and even ending contracts if needed. So, you don't have to worry about any legal stuff, they got it all under control.

Benefits Administration

Benefits can be a tricky business, but your Employer of Record has it all sorted. They handle everything from health insurance to retirement plans. They'll set everything up, answer any questions, and make sure it all runs smoothly. So, you can sit back and know your team's benefits are in good hands.

When to Consider an EOR

If you're growing fast and hiring people left, right and center, it might be time to consider an Employer of Record. It's also a smart move if you're stretching into new countries and need to keep up with different labor laws. Or maybe you just want to free up time to focus on what you do best - running your business. If any of these sound like you, then bringing an Employer of Record onboard could be just the ticket. They'll take care of all the administrative and legal headaches, so you can keep your focus where it should be - on growing your business.

How EOR Differs from Other Employment Models


An Employer of Record (EOR) and a Professional Employer Organization (PEO) might sound like they do the same thing, but there's a key difference. When you team up with a PEO, you're basically sharing the responsibility for your employees. You're still in the picture. But with an EOR, they fully take over the nitty-gritty of employee management. It's like they step into your shoes and take care of all those pesky administrative tasks. So, while both EORs and PEOs give you more time to focus on your business, an EOR really lets you step back and leave the admin stuff to the experts.

EOR vs. Direct Employment

With direct employment, you as the business owner handle everything about employing your team. You're in charge of hiring, firing, paying everyone, making sure taxes are sorted, dealing with benefits and sorting out contracts. It's a lot of work, and it takes your time away from actually running your business. But when you work with an Employer of Record, you can hand over all these responsibilities to them. They take care of everything and let you get back to the important things.

EOR vs. Freelancers/Contractors

Working with freelancers or contractors is like having a team on demand. You bring them in for a project, and when it's done, they're off to their next gig. It's flexible, but you've got to handle all the contract stuff, payments, and usually taxes too. But with an Employer of Record, they can manage all that for you. It’s like having a backstage crew handling all the paperwork while you keep the show running on stage. So, if you want flexibility without the admin hassle, an Employer of Record could be your way to go.


In a nutshell, an Employer of Record (EOR) is like the invisible hand that helps your business run smoothly. They take care of all the behind-the-scenes stuff like payroll, taxes, compliance, contracts, and benefits. So, you can keep your eyes on the prize - growing your business. They're a great choice if you're expanding, hiring a lot, or just want more time to focus on your business rather than administrative tasks. The difference between an EOR and other employment models is that an EOR fully takes over the administrative roles, saving you from all the complexities. So, when you have an EOR, you've got more time to do what you do best - running your business.

Spending Too
Much Time

We can help you accelerate
your remote hiring in the
Philippines, excellently.
Let's Remotify
FacebookTwitterLinkedInCopy Link

Ready to thrive in a remote-first work environment?

Outsourcing is not easy but we’re here to help. Contact us today and we’ll get back the same day.
Get started