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16 min read

Employer of Record Switch: 7 Tips for a Successful EOR Transition

Employer of record

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Author

Jemima Owen-Jones

Published

September 20, 2024

Last Update

September 20, 2024

Table of Contents

Tip #1: Define roles and responsibilities of key stakeholders

Tip #2: Plan your system transfer timeline

Tip #3: Develop a system to collect all the required information

Tip #4: Communicate potential benefit changes early

Tip #5: Plan for a PTO grace period

Tip #6: Announce the EOR transfer in a company-wide communication channel

Tip #7: Get familiar with the new EOR’s transfer process with a kick-off call

Simplify the EOR transfer process with Deel

Key takeaways
  • Switching or consolidating EORs can help you gain a strategic advantage and streamline global expansion. However, the transfer process is complex and demanding, even with the support of a top provider
  • Following some best practices can help HR teams minimize delays and avoid costly errors while ensuring full compliance
  • EOR transfers have implications for employee benefits. Understanding the changes can help you prepare more effectively and ease workers through the transition

Are you looking to upgrade or consolidate your current Employer of Record (EOR) solutions?

Everywhere you look, companies are turning to EOR providers to hire overseas, reduce compliance risks, and streamline operations. However, the growing popularity of EORs means you can engage a provider in almost any country worldwide and hire employees there.

While this may be convenient initially, engaging multiple EOR providers can become messy, expensive and lead to inconsistencies in the service delivery. Soon the time comes for multinationals to refine and consolidate their global hiring efforts.

One major stumbling block is that a large workforce can make the EOR transfer process complex and demanding. Global companies sprawled across multiple countries must contend with:

  • Diverse legal requirements
  • A heavy administrative workload
  • Differing employee concerns and expectations
  • Large data transfers
  • Potential disruption to day to day operations
  • Coordination between all the previous EOR providers

This article will share 7 tips to ensure a successful EOR switch.

Get the full EOR transfer guide: How to Prepare for a Successful Employer of Record Transfer. It provides all the steps to prepare for a successful EOR process. Discover the best practices to follow, your rights and responsibilities, and what your provider should take care of.

Tip #1: Define roles and responsibilities of key stakeholders

The EOR transfer process typically involves lots of stakeholders. There’s the current providers, the new provider, and people from across different departments at your company.

Identifying all the key stakeholders and assigning them clear roles and responsibilities makes it easier to coordinate teams. The table below gives an overview of each department’s typical responsibilities:

Department Role in the EOR transfer
HR - Researches and contacts potential providers
- Acts as a point of contact
- Co-ordinates the different teams
- Monitors progress
- Makes the final decision
Finance - Confirms the financial viability of the EOR provider
- Helps negotiate on contract and pricing
- Learns about the EOR provider's payroll and benefits processes
- Consults on benefits offered by potential providers
- Advises on the project budget
Procurement - Evaluates potential EOR providers
- Ensures the fees align with your budget
- Reviews the contract terms and agreements
- Helps make the final decision
Infosec - Reviews the vendor’s security certification and analyzes policies
- Performs risk assessments
- Checks any software tools meet all required standards
- Works alongside the provider to implement the platform
IT - Evaluates the capabilities and compatibility of the EOR’s system
- Checks whether the new software allows you to scale
- Reviews all the codes, processes, and technical documentation
- Helps the EOR and Infosec implement the system
Legal - Checks the EOR provider has a valid legal status and all the correct licensing
- Reviews contracts
- Clarifies your rights and responsibilities as the client
- Clarifies rights and responsibilities of the EOR as they transfer on

Give each task a clear objective and measurable outcome so everyone knows when it is successfully completed. For instance, you might set a goal that all HR staff need to be trained on how to use the new system. You could aim to have 90% of personnel take a course by a certain date.

In case issues arise, designate a contact person for everyone involved in the transfer process. These people can either help find a resolution or bring the problem to your attention.

Finally, check everyone has the tools and resources required to complete their tasks. Since they’re still handling their regular duties, time may be a particular concern. Make sure assignments aren’t competing with other priorities in their schedule before you assign them.

I was seeking something that was simpler, more globalized, scalable and, for me, a better level of customer service...The push came along to seek a simpler globally efficient and scalable solution.

Bec Donnelly,

Vice President of People at SiteMinder

Tip #2: Plan your system transfer timeline

The system transfer is an especially critical period. If you fall behind, finance teams may be unable to pay employees on time leading to potential compliance issues as well as stress and anxiety for teams that can’t access their wages.

Partnered with an EOR provider like Deel, you don’t have to worry about creating a plan from scratch. We can advise you on an optimal strategy and help you form a timeline. We provide all our client companies with a dedicated project manager who can help you scope everything and track your progress so you’re always clear about your next steps. The project manager will help scope suitable transition dates, take into account current notice periods for your active workers, align with you on changes to benefits that all stakeholders must be aware of, and ensure that all contract modifications needed for your population of workers are successfully made to ensure a seamless transition.

Here’s an overview of all the stages in an EOR transfer and the projects your team needs to manage:

EOR Transfer Timeline
Needs assessment - Identify the reasons why you need to switch EOR providers
- Outline key criteria for the new provider
- Determine the scope and scale of the transfer
Project coordination - Communicate the decision to key stakeholders
- Form a cross-functional team to manage the transfer
- Review contracts with existing EOR providers
- Develop a comprehensive plan
Research - Research potential EOR solutions
- Reach out to potential providers to discuss options and demo the platform
- Finalize your choice
Financial planning - Perform a cost-benefit analysis of each option
- Identify places where you can save or add value
- Ensure costs align with long-term financial goals
Legal & compliance review - Review relevant local labor laws and regulations
- Compare benefits plans and devise a strategy to ensure employees receive all their entitlements
- Check whether the provider can handle the transfer of visas, work permits, sponsorship
- Check your provider has all the required paperwork
- Draft and review contracts with the EOR provider
- Finalize and sign the agreement
Kick-off with the new provider - Hold a meeting to introduce teams
- Establish communication channels and points of contact
- Review the transfer plan
- Decide the phases, order, and timing of the transfer
- Ensure everyone has the necessary tools and resources
Engage the current EOR providers - Inform current EOR providers about the decision to switch
- Gather all the required information and paperwork
- Confirm exit dates
- Coordinate with them and the new provider
Budgeting - Estimate costs for the transfer process, including legal fees, transition expenses, and administrative costs
- Account for potential contingencies and unexpected expenses
- Ensure alignment with overall financial strategy and long-term goals
Employee update - Inform employees about the EOR transfer and its implications for them
- Address any questions and concerns
- Provide a timeline with all the steps involved
- Collect any details or documentation missing from the system
Operational transition - Set up new payment schedules and systems
- Align processes with that of the new EOR provider
- Provide training for all HR and finance personnel
System setup - Arrange a data transfer between the old and new providers
- Integrate systems with the new EOR provider
- Conduct a pilot transfer with a small portion of the data
- Transfer the rest of the data Check the system operates as expected
Onboarding - Add employees onto the new system
- Check everyone can access all the necessary features
- Provide training to show teams how to navigate the platform and use its features
- Offboard from the previous EOR providers
Checks & recalibration - Monitor the performance of the new EOR provider
- Track key metrics
- Adjust processes and strategies as needed
Post-transfer review - Collect feedback from employees and stakeholders
- Conduct an evaluation to gauge success
- Identify any areas for improvement

Deel is currently supporting us with around 52 employees spread out across around 11 countries at the moment,” said Donelly. “The benefits of Deel’s dashboard allows us to effectively manage these 52 people from one platform. It also allows greater efficiencies for our payroll teams globally.

Bec Donnelly,

Vice President of People at SiteMinder

Tip #3: Develop a system to collect all the required information

Although EOR providers can help gather information, the client carries most of this responsibility. You have direct access to the data, so you’re in the best position to collect and verify it.

In many cases, data privacy laws prevent EOR providers from going into the system and accessing and transferring employee records. You may also have a clause in your employment contract. Giving the provider direct access could cause compliance issues and lead to a fine.

Developing a system for collecting the information can streamline the process. You can have all the essential documents upfront and ensure nothing gets overlooked. That way, you avoid wasting time going backward and forwards between all the different teams to retrieve documents or double-check details.

Here are some pointers on how to get systematic:

  • Ask the new EOR provider for a comprehensive checklist
  • Establish deadlines for each document
  • Provide clear details on how to submit information (with examples and images)
  • Use a secure, centralized platform to collect all the data
  • Send reminders when deadlines are approaching
  • Arrange a review of all the files once they’ve been collected

Leading EOR providers offer guidance and support throughout this stage, even when they can’t directly assist. For example, Deel provides all new customers with a form for employee details. We use these to generate all the employment contracts on our platform.

Transitioning to Deel has saved us approx 2-3 days per month in administration time and costs. We used to have multiple people across the globe trying to coordinate and diagnose issues or run manual processes. The time saved includes multiple salaries and productivity time.

Bec Donnelly,

Vice President of People at SiteMinder

Deel Employer of Record
Hire employees globally with the #1 Employer of Record
Deel provides safe and secure EOR services in 100+ countries. We’ll quickly hire and onboard employees on your behalf—with payroll, tax, and compliance solutions built into the same, all-in-one platform.

Tip #4: Communicate potential benefit changes early

When switching EOR providers, you essentially transfer your entire team to a new legal employer. While your provider should help maintain continuity, employees will inevitably experience changes to their benefits plans.

It’s normal for employees to be concerned about these changes. A recent SHRM survey found most workers see benefits as an extremely important part of their jobs. They may worry about how the plans compare and whether they’ve lost any coverage. Some may be stressed about making sure they choose the right plans.

If you’re changing to a leading EOR provider like Deel, you should see an improvement across most of your benefits packages. The challenge is just communicating the changes to employees to ensure a smooth re-enrolment process.

You may be unable to give employees the full picture until you’re ready to distribute the new EOR contracts. However, you can tell them what to expect and explain the advantages of the new provider. As you finalize more details, you can keep them updated.

Your new EOR provider should be able to help. Deel provides comprehensive resources about the mandatory benefits in each country and what plans they offer. Once you’ve onboarded employees, they can also explore their options via the self-service portal. There they can get details about all the available plans and self-enroll.

Bonus: Making your team aware of the changes won’t just make them more comfortable with the transfer process. Research shows that 76% of workers who understand their benefits are happy with their jobs (versus 47% who don’t).

Tip #5: Plan for a PTO grace period

You can’t carry over PTO accruals from a previous EOR contract. Therefore, employees may need to use their remaining time off before the end of their current contracts. Careful planning is required to minimize the negative impact on both employees and the company.

If possible, offer employees a lengthy grace period in which to use their remaining PTO. Teams can stick to their original vacation plans and won’t feel rushed by the company. There’s also no risk of them losing this benefit.

Meanwhile, your business won’t suffer financial repercussions. You won’t need to consider paying unused PTO at the end of the contract or adding those days to the next contract.

Sometimes, a long notice period isn’t possible. Consider which of the following strategies ensures fairness without incurring heavy costs for your company:

  • Give employees a choice between taking PTO early or accepting a payout
  • Add the days to their balance at the start of the new contract
  • Convert any remaining PTO into extra compensation
  • Incentivize employees to take time off before the current contract ends
  • Offer an accelerated PTO accrual rate with the new EOR provider

The ideal solution depends on your specific situation. For example, the dates may play an important role in your decision. If you’re primarily based in Europe and intend to switch EOR providers in May, employees are unlikely to have used much of their PTO with the coming summer holidays.

Deel's platform is very innovative and easy to use. It simplified our hiring process and reduced the onboarding time from a week to just one day.

Pascal Erlach,

Senior Talent Acquisition Manager at Outfittery

See also: How Outfittery used Deel to hire in 7+ countries

Tip #6: Announce the EOR transfer in a company-wide communication channel

Keeping your team informed and supporting them through the transfer means they’ll be more likely to embrace the new EOR provider.

Start by announcing the EOR transfer as a company-wide email so the entire team finds out at once. You can explain the implications and highlight the benefits. Mention the official communication channels where employees can ask questions and state their concerns. A dedicated Slack chat can help you quickly field inquiries.

Throughout the transfer process, keep these channels open and offer opportunities to give feedback. You can gauge employee sentiment about the new EOR service and adjust your strategy as needed. Team members may also help you by indicating issues that have previously gone unnoticed. Give everyone the option to leave anonymous feedback so you’re more likely to get their honest insights.

The EOR can help communicate the changes and demonstrate the new platform. For example, Deel offers:

  • Calls with regional HR and Payroll managers
  • Calls with the regional legal counsel to clarify any concerns coming from the employees and how the transition will affect them
  • Customized employee resources specific to their country and needs
  • Live demos
  • Training sessions
  • Help guides
  • Video tutorials
  • Webinars
  • Survey tools

Leading providers like Deel even handle direct inquiries from your team. If workers have a complex work arrangement, they may need niche local expertise and guidance you can’t provide. Deel has hundreds of legal, accounting, and immigration experts from over 150+ countries who can advise them. We also have a 24/7 live chat so workers in any time zone can contact us about their issues.

Employee onboarding is another critical juncture in the transfer process. You can minimize the uncertainty by showing employees how to use the new platform and navigate the features. Deel has integrated this into our EOR solution with our automated workflows. Every user receives an email welcoming them to our service and gets led through all the necessary steps to create an account, view their details, and re-enroll in benefits. Our experts are also on hand to provide assistance if necessary.

We needed a fast and easy onboarding solution, as our previous approach was time-consuming. Deel changed that for us.

Estefania Tejo,

VP of People in dLocal

See also: How dLocal enters new markets fast with Deel

Tip #7: Get familiar with the new EOR’s transfer process with a kick-off call

Knowing what to expect from the transfer process makes it easier to plan and prepare successfully. You can learn which resources are available and what assistance you can receive. Likewise, you can understand where you need to take responsibility and why.

Your EOR provider should explore their transfer process in detail during the kick-off call. As every business has different needs, there may be some requirements they haven’t anticipated. Ask whether the provider can customize the solution to your organization and provide support for any unique challenges.

A truly great EOR provider welcomes requests and feedback at any point in the transfer. Deel actively encourages our new customers to share their insights so we can improve our processes.

Hearing this information from a neutral third party can help you build confidence in your new EOR provider. Your provider should be able to supply testimonials and case studies from their existing customers. For a totally unbiased look, you can usually find ratings and reviews by searching online. Look for concrete figures that demonstrate your EOR provider has successfully managed a transfer and instantly had a positive impact on businesses.

My favorite things about Deel are support and coverage...I’ve evaluated other solutions but we’re sticking with Deel because it covers anywhere and everywhere and gives us the confidence that things are being done properly.

Harry Rillstone,

Director of Legal and Compliance, Crimson Education

Simplify the EOR transfer process with Deel

See your EOR provider as a strategic partner rather than just a resource. Your chosen provider should understand your objectives and align their services to help you meet them.

This partnership is never more important than during the early days. The EOR provider should set the foundation for all future collaboration and ensure all their efforts support your goals from the start. By building on this strong foundation, you can achieve sustained growth and effectively navigate the complexities of global expansion.

That means a truly great EOR provider should set you up for success and support you through the demanding transfer process.

Deel understands the importance of establishing a strong partnership. Our team has helped hundreds of businesses to transfer to our services and onboarded their employees. We’ve then watched our customers go on to do amazing things from the very beginning.

Deel provides in-country support with clear processes. The easy-to-use platform ensures we can streamline operations across our whole organization, from our talent acquisition team to accounts payable, and understand when and who they need to engage with. It’s simplification in motion.

Bec Donnelly,

Vice President of People at SiteMinder

With Deel EOR, you can expect the following in over 150+ countries:

  • A dedicated project manager throughout the transition
  • A kick-off call to discuss the project timeline
  • Weekly check-ins and HR consults
  • Automated workflows to onboard employees
  • White glove onboarding experience
  • Country-specific document review and management
  • A self-service portal so teams can check their benefits
  • Localized support teams for global workers
  • Built-in visa and immigration services
  • 24/7 live chat app in 13 languages
  • Expert IT assistance with data transfers and storage

Book a call with the Deel team to learn about our EOR service and ask any questions.

Disclaimer
This article is designed to provide a general overview of the process for the people involved in transitioning employees from a previous Employer of Record (EOR) vendor to our services. While the steps outlined here can serve as a helpful framework for many countries, it is essential to recognize that specific legal, regulatory, and procedural requirements vary significantly across jurisdictions.

Due to these variations, each employee must be reviewed on a country-specific basis to ensure full compliance with local laws and regulations. The information contained in this guide is for general informational purposes only and may not be applicable or accurate in all countries. It should not be interpreted as legal advice, nor should it replace consultation with qualified legal or compliance professionals.

Please note that we disclaim any liability or any direct, indirect, or consequential damages that may arise from the use of this guide or any actions taken based on the information provided herein.

We strongly advise consulting with our legal and HR experts who are knowledgeable about the specific requirements of each country involved in the transfer. This will help ensure a smooth and compliant transition in every jurisdiction.

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About the author

Jemima is a nomadic writer, journalist, and digital marketer with a decade of experience crafting compelling B2B content for a global audience. She is a strong advocate for equal opportunities and is dedicated to shaping the future of work. At Deel, she specializes in thought-leadership content covering global mobility, cross-border compliance, and workplace culture topics.

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