Myths & Misconceptions about EOR

When it comes to Employer of Record (EOR) services, there are some common myths and misconceptions about what this kind of solution actually does. While the world is changing now more than ever, understanding EOR and how it can function for your company is crucial. More and more companies are coming to realize why this is the perfect solution for their needs. By shedding light on some of the myths surrounding EOR, we can better understand how it is able to benefit companies all across the world.


To debunk some of the myths surrounding this system, it may be helpful to first understand what an EOR service is. An Employer of Record, also known as EOR for short, is an alternative solution to your typical payroll or HR company. The Employer of Record will handle tasks; such as hiring, benefits, claims, legalities, payroll, and much more. EOR can be extremely beneficial for companies who are looking to expand their teams or markets globally. It also can help manage the market in which they are already present because it can be hard to manage employees in different countries because of ever-changing local regulations and laws. EOR reduces the stress and hassle by undertaking these responsibilities on behalf of the companies.



Myth #1: I don’t need an EOR - I can manage a DIY approach myself


While a DIY approach may seem like the right choice initially, it may actually end up hurting you more than it can help you. DIY approaches can be costly because you will need to set up local entities in each country your employees are located. Besides, laws and regulations are always changing, so it may be very time consuming to constantly managing compliance in each country. However, by choosing an EOR solution, more time can be saved from handling payroll, onboarding new international employees, and handling HR responsibilities, allowing you to focus on growing your business.



Myth #2: My company could never afford an EOR solution - it’s too expensive!


While initially, it may seem cheaper to operate your business without the help of outside sources, in the long run, you will likely find it more beneficial and cost-effective to opt for an EOR. We have stated previously, choosing to manage your business on your own means that you are responsible for tackling your payroll, banking, company taxes, employee benefits, or any legal fines you could possibly face for non-compliance, among many other expenses. By choosing an EOR, those entities are managed for you, saving you money in legal expense and the cost of outsourcing separately for every individual need. You can rest assured through this solution; the benefits will outweigh the cost of trying to manage a business on your own.



Myth #3: My company isn’t the right size for an EOR


An EOR is a great way to grow your company quickly, capitalizing on talent in other countries. Generally speaking, if you already have an entity set up in your country of interest, an EOR may not be the best solution (this is likely the case for larger corporations that are already established globally). However, companies that don’t have these establishments and aren’t currently looking to set up entities globally are great candidates for EOR, regardless of size. Start-ups and mid-sized companies are likely to find the most advantages in these services; nevertheless, any company could find benefit in using an EOR.



Myth #4: Using An EOR will make employees feel less connected to the company


The goal of any good EOR and especially here; at Worknetics, is to understand the client's needs and company values so that you are served in the best way possible. With this in mind, any EOR should feel like they are a seamless part of your company -- because they are. By establishing the great relationships and channels of communication that EOR aims to offer, the company and its employees should feel right at home through the use of this solution.



Final Thoughts

All in all, EOR can take your company to the next level in countless ways. It can provide your business with the best talent in the most cost-effective way, while allowing you to focus more of your time and energy on business growth. While there are myths surrounding the purpose of EOR and how it functions, many of them can be disproven. If you think that EOR might be the solution for you, get in touch with us today!

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