We partnered with several contractors from different regions and have also spent large amounts on traditional hiring to get us the right talent for our organisation, eventually it only ended up as a disappointment every time. It was only lately when we got reference about your EOR services and things started taking shape. One of our clients in Singapore said this while I was meeting him in our business conclave.
Well, this is not the scenario for everyone and for to be considered under every given circumstance of hiring. It’s not about the social media trends, it’s more about understanding your needs, knowing the operations requirement, the kind of team you are looking forward to expanding and most importantly the budget. Know about the best available options for your business needs and then try forming a decision.
Understanding the difference between Employer of Record or EOR services and conventional or traditional employment is crucially important these days, especially for the businesses located in Singapore, as they have been struggling with restrictions of employment pass quota. It’s utterly essential to contain all this and get discussed with CXOs and HR professionals to form the right decisions, get the desired talent and that too in your allocated budget.
EOR Model For Hiring
I will start discussing a bit about both models which are EOR and traditional hiring, so that you can form an idea of what I will discuss later in the article.
Also Read: How do EOR Providers Ensure Compliance with Local Laws?
An EOR opiates as a legal employer for a company to talent hunt, recruit, onboard and manage the workforce while providing complete access to the company of total control of its operations and how they utilize their team. The main idea is to eradicate the complexities of HR services like payroll, taxes and other labour laws pertaining to the particular nation, their visas, work permits, local benefit administration, onboarding and termination, and employment contracts.
The EOR will be there as a local entity handling all the legalities and hiring proceedings while the company simply pays to the EOR service provider and uses the team as per their needs focusing on its operations.
This becomes even more helpful when a company needs to hire in other countries as the EOR being a local entity will make it easier to expand without any complications of labour laws, establishing its own entity and being compliant with other statutory norms and regulations.
Traditional Hiring
A traditional employment is simple and a direct way of getting demands from the operations, designing job descriptions, posting them with paid ads on recruitment platforms, shortlisting candidates, calling for interviews, shortlisting finalists, negotiating and onboarding and then starts the management with their employment norms. It’s hectic, it’s complex, it must be in total compliance with the local laws failing to which you could be penalised.
Get a HR department and hire the hiring managers first to get you the right talent to keep things flow normally. The company in this scenario itself will be the legal employer handling all the particulars of employment ranging from hiring, payroll, taxes, benefits, and employee management along with managing their operations assessments.
Traditional employment in a perspective might allow some businesses to gain complete control over their workforce but that’s not true to full, as complexities and cost to contain all this double up only leaving you abandoned with your budget forcing for delayed appraisals causing low or even no retention rate. It is the most common setup for businesses which is the reason it is being preferred more but think about outsourcing a complete department of your company and saving the cost which could be invested in operations ensuring high retention rate while you operate multi-national.
Key Differences Between an EOR And Traditional Employment?
Some of the common differences considered between EOR and traditional employment are compliance management, employment control, payroll and benefits management, cost and time, and scalability potential, below I have designed a table to discuss things more to it;
| Difference | Employer of Record (EOR) | Traditional Employment |
| Employment Control | EOR handles the legal employment, and the company controls the rest of the operations | The company controls both the legal employment and business operations |
| Compliance Management | The EOR manages local laws and regulations compliance | The company handles laws compliance and requires them to get in-depth legal knowledge |
| Payroll and Benefits Management | Managed by EOR for both local and international employees | Managed completely by the company internally for local and international employees |
| Cost and Time | EOR saves time and reduces administrative burden while remaining more budget-friendly | It takes a lot of time and effort to handle everything internally and may require more investment |
| Scalability Potential | Higher scalability potential especially for global expansion | The scalability potential is limited and requires even more resources |
Benefits of Using REcruitment Central As Your EOR?
Recruitment Central excels in all three essential pillars of successful EOR services which have earned them prestigious awards in all three categories i,e, Best EOR Firm, Best Recruitment Firm, Best Workforce Management Platform. The Hassle-free onboarding and compliance management and streamlined hiring to find the right talent along with the end-to-end payroll and workforce solutions has helped thousands of businesses in Singapore to bypass staffing challenges and expand their teams globally.
Also Read: Global Employer of Record: Key Trends and Developments
To understand the benefits of using an Employer of Record (EOR) is to know how it’s better than the traditional hiring. Our staffing and recruitment panelists have suggested this over the traditional hiring because of reduced risk, speed and flexibility, cost-effectiveness, and more focus on core business activities. We also conducted a survey about the awareness of staffing options in Singapore and below are the explained benefits which makes it a first choice;
- Reduced Risk: EORs ensure all complete compliance to local labour rules reducing the chances of getting into legal complexities.
- Speed and Flexibility: Speed and flexibility comes with EOR, as companies will be focusing more on their operations and could rapidly hire employees overseas and scale up or down their reach as required.
- Cost-Effectiveness: EORs handle everything ranging from onboarding to payroll, benefits, and compliance, minimizing the need for spending resources on HR management and accounts internally.
- More Focus on Core Business: Administrative tasks will be managed by the EOR, the company can emphasize on their core strategies and operations enabling them to achieve desired revenue and enhance quality of their services or products within the industry.
Know Your Options For Global Expansion
Every business aspires to expand to new markets but it always requires a diligent strategy built on data driven considerations. Whether you opt for an employer of record or go for the direct hiring, it’s essential that you must assess the things within your organization first as this formostly will be responsible for how and what you design your strategy with. The advantages and disadvantages of each of the available options would directly affect your organisation’s objectives and goals.
Conclusion
By leveraging the comprehensive EOR services many global companies have enabled themselves to access the best talent in vast talent pools like India. When Google and Facebook have been hiring their top tech leaders from Bangalore and when Google recently opened another GCC in Bangalore, there is definitely something to this destination. Well, GCC is not the option for small or medium scale businesses, but EOR could help you with much more than that while lowering the risk associated with compliance and administrative complexities.
