One of the most exciting new industry technologies is the employer of record (EoR) service. Employer of record services allow small and medium-sized businesses to have their payroll, taxes, and benefits handled by a third party. Instead of dealing with the headache of handling these tasks, small businesses can outsource these and focus on running their business.
This saves small businesses a lot of time and money. However, many people are still confused about the role of the employer of record. In this article, we’re going to tackle some of the most common misconceptions about EoR services and help you figure out if the EoR service is right for your business.
Most Common Myths About Employer of Record Services
Myth #1: Employer of Record Services are More Expensive Than Setting Up Your Own
A common concern among small business owners is the cost of using an EoR service. While the upfront cost can look expensive, businesses can save money down the line, contrary to setting up their own, which can cost you more overhead charges. Overhead charges include rent, utilities, phone bills, and payroll.
By outsourcing your payroll, you can free up funds in your budget that you would be spending on payroll costs. Moreover, you will also save a great deal of time and hassle by not worrying about any of the administrative tasks.
Myth #2: Employer of Record Services are Only for Long-Term Projects
A recent trend in the small business community is the rise of employer of record services for one-time or long-term projects. In most cases, long-term projects can be an important part of making a business successful. However, you can also use EoR services for one-time projects, such as launching a new product or a new service.
For example, if you are launching a new company, you can use your EoR service to handle the payroll for the new company. In this case, you will only use the EoR service for the one-time project, and then once the project is complete, you will no longer use the service.
Myth #3: The Employer of Record Won’t Share the Same Company Principles You Live By
One of the most important aspects of using an EoR service is ensuring that you are comfortable with the company’s principles. When you use an EoR service, you will be entrusting the company with the responsibility of handling your payroll, taxes, and employee benefits.
That said, you should ensure that the company’s principles align with your own. For example, you should be wary of using a company known to discriminate on a case-by-case basis.
If you feel that the company discriminates against certain people, you should avoid using the EoR service. It is important to note that it is not up to the employer of record to dictate what they may or may not do. A good EoR company knows how to work with you and your staff to uphold your values.
Thinking of Getting Employer of Record Services?
Knowing whom to entrust your company’s administrative tasks is crucial in achieving your goals. Your employees are your biggest resource; thus, it’s only right that you think of the best ways to take care of them. If you need help running your business, call us at ClearPath to know more about our services.