The global world of work is changing faster than we can imagine. Businesses can now lead teams across nations and continents. As a result, many are seeking smarter and more affordable ways to hire, onboard, and manage international talent.
Hiring globally can widen your talent pool and give you access to new markets, but it can also be a complex maze rife with challenges, including:
- Global payroll processing
- Compliance with local employment laws and regulations
- Complex hiring and onboarding processes
- Remote or hybrid employee engagement
- Communication challenges
- Navigating cultural differences and norms
Luckily, this new business era has also opened the door for robust digital tools and platforms to support today’s remote global workforce. From collaboration and project management tools such as Slack and Asana to all-in-one Employer of Records (EOR) platforms such as Multiplier, companies are armed with great resources to support globally distributed teams.
Whether you are looking to expand to international markets, diversify your workforce, or save money on payroll and recruitment costs, partnering with an EOR might be the next step in your hiring strategy.
The history and controversy that led to the EOR boom
It wasn’t that long ago that companies had limited options for hiring global talent. If an employer didn’t have an established business or “legal entity” in the same country as the candidate, their only option was to hire them as independent contractors.
Not only does this run the risk of misclassification, but those employees are also not eligible for any benefits such as insurance, pension, paid time-off, and so on.
In the early 2000s, EORs—that is, employers of record—entered the scene when internet usage was becoming more widespread. They have taken off significantly in recent years due to digital transformation, the gig economy, and the shift to remote working.
Indeed, according to the latest market research reports, the global Employer of Record Platform market was valued at $4.3 billion in 2023 and is anticipated to reach $6.6 billion by 2030, witnessing a CAGR of 6.8% during the forecast period 2024-2030.
But what exactly are they? In short, EORs act as a legal entity that helps hire employees for organizations based outside the employee’s jurisdiction. From a legal perspective, the EOR becomes the employer, managing all aspects of hiring and managing employees’ global payroll, HR, employee benefits, and regulatory compliance.
Essentially, the EOR takes on the full legal responsibility of this process with legal experts based on the respective country’s local tax laws and compliance with labor laws. At the same time, the company hiring has full control of day-to-day employee management and business operations while staying focused on growth and profits.
A global workforce is a win-win for employers and employees
From small- and medium-sized businesses to enterprise organizations, working with EORs levels the playing field when accessing the world’s best talent. And, in turn, millions of people across the globe have access to a wider range of career opportunities at their disposal, regardless of geographical location.
Studies have shown that building a meaningfully diverse workforce brings distinct advantages such as unique skills, perspectives, and ideas that drive innovation, better business outcomes, and a competitive advantage. In fact, HBR found that businesses that invest in building diversity within their leadership and employees are more likely to “out-innovate and out-perform” those that don’t.
Companies seeking out specialized skills could benefit from exploring specific countries that have an abundance of workers in these fields. For instance, China and India are well known for software engineering and associated IT skill sets, but challengers are rising fast. Other countries to consider for international tech talent are Hungary, Vietnam, Romania, the Philippines, and Nigeria.
An international footprint without heavy costs
Entering new markets and leveraging local knowledge and insights is attractive to many companies looking to scale their business. Yet, hiring overseas on your own is costly and time-consuming. When a company is left to its devices to set up its own legal entity, the cost is not just monetary but temporal as bureaucracy closes in.
Employers can avoid hefty setup and maintenance fees and associated risks when working with a more cost-effective scalable solution — an all-in-one EOR platform.
With an EOR, a business has flexibility at its fingertips — it can enter new markets, scale up or down its operations, and quickly adjust to changing business conditions or compliance regulations.
Complexity simplified with expert legal compliance
All employers have specific compliance obligations they must comply with when hiring: And when it comes to employing across borders, it gets even more complicated. As a global employer, it is critical to provide suitable benefits and ensure all employee contracts are compliant with local labor laws.
To avoid legal issues, the EOR’s legal team will advise businesses on how to classify employees appropriately. If a full-time employee happens to be classified as an independent contractor, it can result in fines or steep legal penalties.
One major benefit of working with an EOR is that they have trained legal specialists ready to ensure that employees are hired in compliance with the specific country’s labor laws. These legal experts are also responsible for staying on top of any regulatory changes in the respective country.
The Multiplier multiplier
Historically, companies have had to face many hurdles when making the leap into global employment. Multiplier, your all-in-one EOR platform, is ready to partner with you to simplify the process end-to-end, including payroll, taxes, benefits, and compliance, allowing you to focus on your core business needs.
Multiplier offers global payroll, multinational compliance, EOR services, and more to simplify and streamline your global talent management. So, you get all the benefits with none of the hassle.
If you are ready to ditch the headache of figuring out global hiring on your own, chat with a Multiplier expert today.
