Hiring in Guatemala with an Employer of Record (EOR)

Hiring employees in Guatemala? Partner with an EOR.

Guatemala is a significant economy in Central America. Known for its rapidly growing infrastructure, Guatemala plays a key role in regional trade and economic development.

If you’re looking to expand your business’s presence or operations in Guatemala, an Employer of Record or EOR can help you get started quickly. This allows you to avoid the complexities of establishing a local entity or managing HR functions independently.

An Employer of Record serves as the legal employer for your workforce in Guatemala, while you retain control over daily operations and team management.

Why choose an EOR for hiring in Guatemala?

Small businesses and medium-sized enterprises often face the need for global expansion but may lack the in-house expertise and resources to manage this transition effectively. These and other employers can benefit from partnering with an EOR to make new hires in Guatemala. An EOR enables you to:

• Hire and onboard employees quickly, without establishing a formal business entity in a new country.
• Reduce compliance risks, as the EOR assumes the responsibility of employing staff on your behalf.
• Outsource payroll, tax withholding, and benefits administration.
• Lower the administrative burden associated with HR, compliance, and payroll.

As the legal employer for your Guatemala-based workforce, an EOR handles local employee onboarding, payroll, and management of benefits and taxes—all while ensuring compliance with local employment laws and alignment with your company’s practices.

By delegating core HR and compliance functions to an EOR, in other words, you can focus on expanding your business in Guatemala.

Choosing between an EOR and PEO in Guatemala

You have two primary options when employing staff in a new market like Guatemala: an EOR or a PEO. Which approach to take depends on the key differences between and EOR and PEO.

An EOR is a clear choice for any employer whose objective is to delegate all risk for compliance with employment law in Guatemala.

How to select the right EOR provider in Guatemala

Several questions must guide your decision-making when selecting which EOR is best suited for your needs. How effectively does the EOR manage compliance with employment law in Guatemala compared to other providers? What is the quality of the EOR’s support? And does the EOR offer comprehensive operational coverage in Guatemala? Some EORs may not have the ability to do so.

Here’s what to consider:

• Legal compliance. The right EOR should have thorough knowledge of Guatemala’s labor laws, worker rights, tax regulations, and local benefits. Seek a provider with a solid track record and inquire about their experience in successfully navigating challenges specific to your industry.
• Customer service: Does the EOR provide 24-7 support and assign dedicated account managers? Multiplier does so, offering continuous, human-first support (no automated bots) and assigns a dedicated manager to every account.
• Transparent pricing: Some EORs may appear cost-effective at the outset but hit you with hidden fees. This is because their pricing models may be unclear. Be sure you fully understand all initial costs associated with an EOR before committing.
• Total cost of ownership: It’s not just about choosing the lowest up-front price. Solutions that may seem especially affordable at the outset can sometimes bring higher costs if quality or service falls short. Make sure whatever EOR you invest in aligning with your budget also ensures quality and reliability.

How EOR services work in Guatemala

Step 1: Send that contract over

Once you’ve identified your candidates—and signed up with the perfect EOR—it’s time to send them locally compliant employment contracts.

With automated HR functions, Multiplier can generate contracts that fully comply with Guatemalan labor law in under five minutes. You can customize these contracts to specify job responsibilities, working hours, salary, and termination terms. Once finalized, your EOR securely sends the contract and oversees the signing process.

Step 2: Attract top talent with competitive benefits

Interested in offering a competitive benefits package to draw in top candidates? Your EOR can simplify this by providing benefits options that align with local standards and employee expectations, eliminating the need to manage local providers on your own.

Step 3: Gather essential documentation

The next step involves collecting your new hire’s tax and banking information. With an EOR like Multiplier, this process is seamlessly managed to set up payroll. Multiplier handles all necessary documentation, making the process smooth and hassle-free.
While onboarding employees in Guatemala might seem complex, an EOR partnership streamlines it.

Step 4: Run payroll for employees in Guatemala

Managing payroll in Guatemala can be challenging, with specific tax rates and mandatory social contributions to consider. By partnering with an EOR like Multiplier, you ensure accurate and timely salary disbursements while covering all local tax, contribution, and deduction requirements. With Multiplier’s global payroll solution, you can handle payroll for your entire international team from a single platform, without the need for multiple local vendors.

Step 5: Manage your employees and leave HR compliance to the EOR

Multiplier takes care of all post-hire onboarding steps, ensuring that employees in Guatemala receive their paychecks, from the first to the last, accurately and on time to include all benefits, taxes, and contributions. If an employee in Guatemala requires termination or leaves voluntarily, Multiplier handles all compliance obligations accordingly.

Moving forward with Multiplier EOR in Guatemala

An EOR is a smart choice for any business looking to expand quickly into Guatemala. The operational efficiency, flexibility, and reduced risk that come with using an EOR make it an invaluable solution.

Multiplier’s Employer of Record (EOR) services offer comprehensive, end-to-end ways to build your team in Guatemala. By outsourcing essential HR functions, you can hire top talent without the complexities of setting up a local entity.

Multiplier facilitates seamless hiring, onboarding, and employee management. You benefit from locally compliant contracts, managed payroll and taxes, and a range of customizable benefits designed to meet local standards. This approach provides a positive employee experience while avoiding compliance headaches.

Book a demo to see how Multiplier makes HR and compliance in Guatemala simple and effective.