What Is an Employer of Record: ERO Types and Benefits

Alex Kehayias | Apr 14, 2024

What Is an Employer of Record: ERO Types and Benefits

Regarding business expansion and global talent acquisition, the term “Employer of Record” (EOR) is becoming increasingly widespread. However, what exactly does it mean?

At its core, an EOR is a game-changer for businesses looking to stretch their operational borders without getting entangled in the web of international employment laws.

EOR basically handles all the fine details of employment so you can shine in the global market. By partnering with an EOR, companies can easily hire across borders, tapping into a global talent pool that was once beyond reach.

This approach broadens horizons and ensures that your business remains compliant with local employment laws, all without the hassle of setting up a legal entity in each country where you wish to operate.

What Is an Employer of Record (EOR)?

An Employer of Record, in essence, acts as the legal employer for your international employees. This means they take on the heavy lifting of HR functions, from payroll processing to managing full-time employee benefits, and ensure compliance with local labor laws. This translates to a hassle-free way of global hiring and employment management for businesses.

Unlike traditional employment models where businesses manage in-house HR tasks or set up legal entities abroad, an EOR simplifies the process. There’s no need to get in the weeds with local employment regulations or juggle multiple payroll systems. An EOR does it all for you, acting as a bridge to new markets and making global expansion a smooth sail.

As your legal employer on record, an EOR shoulders the responsibility for your global team members. This includes handling onboarding and offboarding processes, managing payroll taxes, ensuring compliance with local tax laws, and offering competitive benefits packages.

This setup allows you to focus on what you do best — growing your business — while we at Mosey ensure that your employment practices are compliant, efficient, and tailored to expansion in the US to seamlessly manage state and local level requirements.

By partnering with a global employer of record like Mosey’s partner Remote, businesses can confidently step into new territories, knowing that their employment practices are in expert hands.

Mosey’s focus on compliance and a deep understanding of local employment laws across the United States make us an ideal partner for businesses aiming for global expansion with employees in the US.

Whether it’s managing international employees based in the US, tackling regulatory requirements, or offering cost-effective solutions for global payroll compliance and HR tasks, Mosey stands ready to support your journey into the US global workforce.

What Is the Need for EOR Services?

The global market is brimming with opportunities, but it’s not without its hurdles. Expanding your business reach globally is stepping into a new arena of employment laws and regulations.

Each country presents its own rules, and keeping up can feel like a full-time job. That’s where EOR services come into play.

Dodging Compliance Risks Like a Pro

Compliance is an important piece of the global expansion puzzle. Different countries have unique labor laws, so the risk of stepping on a legal landmine is high.

EOR services act as your frontline defense, ensuring that your business maneuvers through new markets without falling foul of local employment laws. This means less sweating over compliance and more focus on growth.

The Cost-Effective Path to Global Expansion

Let’s talk about the bottom line. Setting up shop in a new country often comes with a hefty price tag, not to mention the administrative circus of managing a global team.

EOR services streamline this process, offering a financially smart solution that sidesteps the need for your own legal entity in each country you operate. It’s about smart scaling — achieving global reach without the global headache.

How Does EOR Work?

First impressions count, and that’s no different when welcoming new team members aboard. EOR services handle the onboarding process with finesse, ensuring everything from employment contracts to background checks are ticked off the list. It’s about setting the stage for success from day one, ensuring your new hires are ready to hit the ground running.

Payroll Processing Made Easy

Payroll includes taxes, benefits, and compliance — especially globally. EOR services take the reins, managing payroll taxes and employee benefits and ensuring every payment complies with local tax laws.

This means your team gets paid correctly and on time, every time, no matter where they are in the world.

Stepping into a new country’s employment law scene may feel intimidating. EOR services act as your safety net, handling the legal aspects so you don’t have to.

From adhering to local labor laws to managing payroll taxes and workers’ compensation, EORs ensure your business remains on the right side of the law. It’s about peace of mind, knowing your global employment strategy is both compliant and competitive.

What Are the Types of EOR Service Providers?

When it comes to global expansion, not all EOR services are created equal. Broadly speaking, there are two main flavors to choose from: Partner-dependent EORs and owned-entity EORs.

Each comes with its own set of perks and quirks, much like choosing between a latte and an espresso for your morning caffeine fix.

Partner-Dependent EORs: The Networking Pros

Partner-dependent EORs are the social butterflies of the global employment world. They collaborate with local partners in various countries to provide EOR services.

This approach has its perks, like a wide reach across different markets. However, be aware that you’re not always sure what you’ll get regarding service quality and pricing consistency.

Owned-Entity EORs: The Control Enthusiasts

On the other hand, owned-entity EORs build their own infrastructure in each country in which they operate. Think of them as the chefs who meticulously control every ingredient of the global employment dish they serve.

This model offers more stability and predictability in pricing and service delivery, making it a solid choice for businesses aiming for a seamless global expansion.

How Are EOR and PEO (Professional Employer Organization) Different?

Another player in the game is the professional employer organization (PEO). While EORs and PEOs might seem similar, they cater to different tastes in the global employment banquet.

EORs offer a full host of services by becoming the legal employer for your international team, handling everything from payroll to compliance. It’s essentially your guide in global employment, taking on the legal responsibilities so you don’t have to.

PEOs, conversely, enter into a co-employment arrangement with your company. This means you’re sharing the employment responsibilities. You still have control, but you’ve got a partner that’s especially handy if you already have a legal presence in the country.

When Is It Beneficial To Choose a PEO?

Opting for a PEO might be for you if you want to extend your existing operations and already have a local entity. It’s a way to beef up your HR services without taking on the full weight of legal employer responsibilities.

A PEO could offer the flexibility you need if you’re dipping your toes in new waters but plan to eventually dive deep.

What Are the Benefits of Using an EOR?

One of the greatest benefits of using an EOR is accessing a global talent pool without the hassle of establishing a local entity in each country. It effectively invites the best and brightest to join your team wherever they call home.


Partnering with an EOR means you can confidently face local tax laws and employment regulations. EORs keep you on course, ensuring compliance and steering clear of regulatory troubles that could slow down your global endeavor.

Streamlining HR Functions

EOR services handle all HR tasks, from payroll processing to concocting competitive benefits packages. It’s about making HR management easy and ensuring your global team is happy, healthy, and highly motivated.

At Mosey, we’re all about making business compliance a walk in the park. Whether you’re exploring new markets with global employment or looking to streamline your international HR functions, we have the expertise and solutions to support your journey for state and local compliance in the US.

Expand With Mosey

Trying to tackle the global market has never been easier. With Mosey, you can tap into the United States’ talent pool, ensure compliance across jurisdictions, and streamline your HR functions without breaking a sweat.

Whether you’re looking to hire remote workers, manage independent contractors, or outsource employee management, Mosey is your trusted partner in operating compliantly.

Ready to simplify your strategy? Let’s partner up and take your business to new heights. Book a demo with Mosey today, and let’s make global hiring a breeze.

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