Employer of Record FAQ

What is an Employer of Record (EOR)?

Employer of Record (EOR) Services is an outsourced business solution which takes on all the employment responsibilities for a group of employees.  EOR Services function as the legal employer for the employee, taking care of all employment-related responsibilities such as payroll, benefits, and compliance which allows businesses to focus on their core offerings without the stress that comes with managing the back office.

How do Employer of Record Services work?

The EOR Services provider hires the employee on behalf of the company and becomes the legal employer of the staff.  The provider handles all employment-related responsibilities for the employee, including payroll, benefits, and compliance with local employment laws.  The company continues to manage and direct the work of the employee, while the EOR Services provider handles all the employment-related administrative tasks.

Why would a company use Employer of Record Services?

• An EOR allows companies to hire employees in areas where they do not have a local entity. Employer of Record services are registered nationwide and, in some cases, other countries which allows businesses to hire the best candidates regardless of location.
• To avoid the cost and complexity of setting up a local entity to administer payroll and benefits.
• To minimize or eliminate risk by offloading the risk to the Employer of Record.
• Ensure compliance with local employment laws and misclassification.
• To simplify the process of hiring and managing employees in multiple locations.

To focus on the core purpose of your business or organization without the additional hassle of employment-related administrative tasks.

What should companies consider when choosing an Employer of Record Services provider?

• Reputation and experience of the provider
• Quality and availability of dedicated support
• Range of services that allow for customization to tailor needs
• Provider has cutting edge technology and platforms that allow for ease of use

Why would a business want to use a Nationwide employer of record service provider rather than a worldwide provider?

A Nationwide employer of record service provider can offer more personalized support and tailored services that are better suited to the needs of a business. They often have a better understanding of the local legal and labor requirements, as well as any tax implications. Here at Headway, we provide each company with a personal account manager that is specifically dedicated to support their business through it all. Having that personalized experience is an extreme advantage to a company looking to focus on their core offerings while Headway manages the back-office operations.

What are the risks associated with using an employer of record service?

The real risk is not using an EOR and opening your organization to costly compliance issues! At Headway we are constantly improving and researching local labor laws in all fifty states and Puerto Rico to ensure that our client’s receive the most up to date information regarding laws and regulations. Avoid potential liability issues by allowing Headway to pay wages and file taxes timely on behalf of your company.    Headway ensures that our contracts are clear and tailored to each client and our dedicated account specialists are always available to provide customer support.

How long does it take to set up an employer of record service?

The amount of time it takes to set up an employer of record service depends on the complexity and size of the organization.  It can take anywhere from a few days to a few weeks to get all the necessary paperwork in order and get everything set up.

How can businesses ensure that their employer of record service is dependable?

Businesses can ensure that their employer of record service is dependable by researching any companies they are considering.  It’s important to look for a company that has experience in the industry and is knowledgeable about applicable laws and regulations. Additionally, businesses should always make sure to read reviews of the company to ensure they provide quality customer service and reliable services. Finally, it is important to request documentation of processes and policies to verify the trustworthiness of the provider.  Here at Headway, we have many testimonials by our clients that describe us as, “…super easy to work with… haves great management and flexibility… as well as responsiveness and communication is great.” It is always important to work with a business you can trust.