Frequently Asked Questions
An EOR legally employs the worker and manages employment payroll, taxes and statutory benefits. A COR manages an independent contractor relationship, including classification, contracts and payments. The contractor does not become an employee of the COR merely because a COR service is used.
Employer of Record (EOR) services enable companies to build and manage a global workforce without directly assuming local employment compliance responsibilities.
In comparison, a Professional Employer Organization (PEO) is primarily designed for companies seeking domestic HR services and workforce management support within the United States, where the client company agrees to share compliance and employment-related responsibilities.
Under the EOR model, the EOR provider serves as the sole legal employer of the employee. By contrast, a PEO operates under a co-employment model, meaning both the client company and the PEO share certain legal, HR, and employment responsibilities related to the employee.
Another key difference is geographic scope. PEO services generally operate domestically and are primarily focused on the U.S. market, which means companies typically cannot use a PEO to hire international employees in foreign countries.
By contrast, global EOR services are designed for international hiring, overseas employment compliance, global payroll management, and cross-border workforce expansion across multiple countries.
Employer of Record (EOR), also known as a legal employer or global employment solution, refers to a service model in which a third-party provider legally employs workers on behalf of a company.
When a business does not have its own local entity in an overseas market, the EOR provider acts as the official employer of record for the employee and assumes local employer responsibilities. This typically includes employee onboarding and offboarding, payroll processing, social security contributions, tax compliance, employment contracts, and other HR administrative services, ensuring employees can be hired compliantly and paid legally in the target country.
When using Employer of Record (EOR) services, sailglobal’s local legal entity becomes the official legal employer of the individuals you hire. Employees sign locally compliant employment contracts with sailglobal’s local entity rather than directly with your company.
Your company retains full control over the employee’s compensation structure, daily responsibilities, work assignments, and performance management. Meanwhile, the EOR provider assumes the legal employment responsibilities and manages all employment-related administrative and compliance matters.
This typically includes:
• Drafting and managing locally compliant employment agreements
• Global payroll processing and salary payments
• Employee benefits and social security administration
• Payroll tax management and statutory filings
• Employment compliance and labor law administration
• Employee onboarding and offboarding support
Through the EOR model, companies can hire international employees compliantly without establishing a local legal entity, while reducing global employment risks and ensuring compliance with local labor laws and payroll regulations.
Yes! Employer of Record (EOR) is generally legal in most countries, provided that the employment structure is properly set up and fully compliant with local labor, tax, and immigration regulations.
sailglobal’s EOR model operates through its licensed local entities, which act as the official legal employer of the worker. Meanwhile, the client company retains full control over the employee’s daily responsibilities, task allocation, and performance management. This structure is widely adopted by companies that want to hire internationally without establishing their own local legal entity.
No. With proper planning, switching EOR providers is typically straightforward. sailglobal manages the transition process to help ensure compliance with local labor laws, tax requirements, and, where applicable, work visas, minimizing disruption to payroll, benefits, and employee experience. With extensive global employment expertise, sailglobal helps businesses complete transitions smoothly and with minimal operational impact.