Article
13 min read
Author
Jemima Owen-Jones
Published
August 21, 2023
Last Update
June 25, 2024
Table of Contents
Rapid market expansion and testing
Reducing tech spend and admin overhead
Workforce planning for M&As
Payroll consolidation across regions
Offering equity and competitive employee benefits
Deel removes obstacles to global hiring
Enterprises have specific needs when expanding to new markets, like low-risk market entry and testing new opportunities with minimal commitment. In some cases, these organizations may be winding down operations in unprofitable markets, so they struggle to find a way to keep their key employees from that country.
Limited payroll options, high costs of establishing an owned entity, and compliance requirements are just a few of the hurdles that may be standing in the way.
But there’s one simple solution—employer of record (EOR).
In this guide, you’ll learn how working with an EOR can easily solve the five common challenges enterprises face during global expansion, and how Deel effortlessly addresses these challenges.
An employer of record enables enterprises to hire workers on the ground quickly and test new markets with minimum risks, thanks to its expertise in global compliance, streamlined processes, and knowledge of local regulations.
When expanding your operations to a new market, you may face several challenges:
EORs have a deep understanding of local markets and broad partner networks that help ensure compliance in the host country.
As a global EOR, Deel provides localized employment contracts in 100+ countries, assuming all legal responsibility for your employees while you manage their day-to-day work. Deel also guarantees your foreign employees all statutory benefits and rights and protects you from employee misclassification and permanent establishment risks.
Read more: Can an Employer of Record Protect Your Company Against Permanent Establishment Risks?
Instead of working for months to register an entity, you can hire and onboard employees and contractors from the global talent pool in a matter of days and for an affordable fee, leveraging new markets before your competitors and avoiding the risk of losing your best talent.
Finally, Deel assigns a dedicated customer success manager (CSM) to each client, no matter how small. This way, you also gain insight into local best practices, industry knowledge, and have a reliable advisor during your expansion journey.
Learn more: The Benefits of a Dedicated CSM: How Deel Sets You up for Success
Not every expansion effort yields immediate success. Unprofitable markets can pose a challenge, but EOR equips enterprises with a graceful exit strategy.
Deel's expertise in navigating local regulations and its global network allows for the smooth and efficient winding down of operations. Retaining key talent in the host country while minimizing financial repercussions becomes a feasible option, ensuring you can strategically reallocate resources to more promising target markets.
An EOR can help consolidate your HR tech stack by allowing you to manage everything in one platform, from hiring and onboarding to payroll management to local compliance and benefits administration, especially if robust automation features are available.
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
If you use different tech for managing your direct workers and international ones, you may face the following obstacles to seamless processes:
A global employer of record like Deel can successfully tackle all these challenges by centralizing your data in our global-first platform with fields tailored to the country where your talent resides. This way, you can easily hire employees from new countries without needing to implement new HR systems to manage them.
Onboarding an employee in Germany is completely different from onboarding an employee in Argentina. But you don’t have to use 16 different tools to onboard all your workers in different locations; you can do it all in one place with tailored workflows without the frustrating not-applicable fields that disrupt your productivity and interrupt your processes.
Spend 51% less time onboarding new hires!
Deel also offers a wide range of integrations with other workforce management systems, such as Ashby, BambooHR, and CultureAmp. Not only does this make Deel cost-effective, but also a highly scalable platform, as our HR services were designed to support growing global teams.
Other than reducing tech and admin overhead costs, an EOR can save you significant amounts of money when unlocking a new market, compared to registering your own legal entity.
The financial advantages of hiring through an EOR are reflected in:
Read more about the financial advantages of using EOR services instead of setting up entities overseas.
An employer of record helps enterprises integrate talent after a merger or acquisition by enabling them to keep employees from countries where they don’t have a local entity and provide an equitable employee experience for all workers regardless of location.
Mergers and acquisitions are complex business processes, even more when done cross-border:
An EOR can effectively address most of these cross-border transaction challenges. Through its local partners, an EOR can help you build competitive compensation packages and offer localized benefits relevant to local talent, all while staying compliant.
With its advanced technology and centralized platforms for talent management, EORs can also help streamline processes, automate manual tasks, and centralize employee data in a single database for easier access, enhanced data security, and more efficient management.
Deel doesn't take data privacy and security lightly. That's why we offer multiple methods of protecting our client data:
Deel’s HR tools can also help with cultural integration of the inherited talent and fostering the sense of belonging among new joiners. Deel Engage plugins for Slack allow you to boost employee engagement and encourage workers to connect despite the physical distance.
An EOR can offer expertise and compliance in running payroll for international employees, ensuring accurate payouts, deductions, tax filing, and compliant record keeping.
Payroll processing outside of the borders of your own country can come with a number of hurdles:
Tax compliance: Tax requirements vary by country and you must comply with local regulations in the new countries to avoid fines and legal issues
Currency and data management: Dealing with multiple currencies, data privacy regulations, and secure data handling adds complexity to payroll operations
Payroll variation: Managing varying payroll practices, tax calculations, and deductions across regions requires accuracy and consistency
Integration and systems: Ensuring seamless integration of HR and payroll systems, especially in different time zones, can be technically demanding
Regulatory changes and compliance risk: Frequent changes in regulations and the risk of non-compliance require continuous monitoring and adaptation
Provider management and auditing: If working with multiple payroll service providers, you need to ensure accurate reports, compatible data and processes, and frequent audits
Payroll visibility: Achieving a comprehensive view of global payroll data for reporting and analysis purposes can be challenging if data is scattered across different platforms.
Employers of record can address these challenges for client companies thanks to robust platforms where you can manage your entire payroll in one dashboard. Manual tax calculations are replaced with automation for higher accuracy and your workers automatically receive payslips after each payday.
Deel enables clients not only to pay workers everywhere in one click from one dashboard, but also to run payroll for direct employees, international employees, and independent contractors under one roof, with multiple payment options and currencies supported across the globe.
Since using Deel’s Global Payroll, Change.org has saved more than 300 hours on admin each month.
"Other providers are stuck in the past in the way their platforms are built and the way their customer service works. We wanted the elevated experience Deel provides," says Allie Shulman, Director of People Operations at Change.org.
Deel also offers comprehensive reporting features that allow customers to gain insight into their global payroll to understand their spending and easily spot any errors between payroll cycles.
With 200+ in-house, localized experts and payroll managers, you can be sure that you’ll be notified of any changes in payroll tax regulation in any country you hire from.
As their legal employer, an EOR can offer your international employees localized benefits and perks that are tailored to their needs, while complying with local laws and regulations regarding statutory benefits, minimum wages, and more.
When hiring globally, enterprises often encounter various obstacles to offering relevant and competitive benefits packages:
Partnering with an EOR allows you to offer employee benefits you wouldn’t be able to access without a local presence. Your remote workers will be able to enjoy private health insurance, stock options, wellness perks, and any other benefit your EOR can offer through their partner network.
Other than enabling the diversity in your compensation packages, EORs ensure that equity and benefit plans adhere to local employment laws, safeguarding against legal pitfalls.
Deel integrates with Ramp, the platform for easy equity management for your global team.
Learn more about how Deel helps you provide equity to foreign workers.
Deel’s learned from its own experience: with a team of 2,000+ people dispersed across around 100+ countries, we know how frustrating hiring can become when you face the complexities of international employment laws.
But don’t let them stop you from growing your global team.
With Deel’s vast in-house expertise, self-serve and easy-to-use platform, 24/7 in-app support, flat-rate pricing without hidden costs, and incredible flexibility to cater to your business needs, we can help you hire talent in over 150 countries and streamline HR and payroll regardless of location.
Learn why 15,000+ businesses trust us to support their global expansion.
Interested in PEO rather than an EOR? Coming soon: Manage payroll, benefits, and HR for your US team with Deel.
Want to know everything about EORs? We have… exactly that. Download our detailed guide to employers of record.
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