Employer of Record (EOR) – Master Buyer FAQ

Get clear, direct answers to the most common questions buyers ask about Employer of Record (EOR) services — from compliance and cost to hiring speed and country coverage.

Choosing the right Employer of Record (EOR) is critical if you want to hire talent globally without legal, payroll, and compliance risks. At Smart Outsourcing Solution (SOS), we’ve worked with startups, scale-ups, and enterprises worldwide, helping them expand quickly and compliantly. This FAQ brings together the top 7 buyer questions our clients ask before partnering with an EOR — designed to help you make informed decisions faster.

Frequently Asked Questions About Employer of Record (EOR)

Cost & Pricing Transparency

What does an Employer of Record cost, and are there hidden fees?

An Employer of Record (EOR) legally employs staff on your behalf. Smart Outsourcing Solution (SOS) charges a transparent flat monthly fee of $190 per employee, covering payroll, compliance, and statutory benefits. There are no setup fees, termination charges, or FX markups. Optional add-ons are itemised and agreed upfront for full budget clarity.

How do EOR costs compare to setting up my own entity?

Setting up your own local entity requires legal incorporation, payroll, HR, and compliance management, often costing tens of thousands upfront. An EOR like SOS removes these overheads, charging only per-employee fees. This makes market testing, pilot teams, or fast expansion far more cost-efficient and avoids locking capital in administrative infrastructure.

Are there volume discounts for EOR services?

Yes. SOS offers tiered pricing for larger teams. Volume discounts reflect efficiency in payroll, compliance, and account management. Startups or scale-ups hiring multiple employees benefit from lower per-employee costs while maintaining compliance. Transparent tiered tables show projected savings, helping businesses forecast costs as teams scale without sacrificing service quality.

What are the typical payment terms with an EOR?

Payment terms usually involve monthly invoices per employee. SOS provides clear invoicing schedules, with payment via bank transfer or approved digital channels. Fees cover all statutory obligations, payroll, and compliance services. Transparent invoicing ensures there are no surprise charges, allowing businesses to forecast budgets confidently while keeping all employment costs predictable.

Are there hidden fees in EOR agreements?

Legitimate EOR providers disclose all fees upfront. SOS does not charge termination fees, FX markups, or setup costs. Any optional services, such as HR support or recruitment, are agreed in advance with itemised pricing. Transparency prevents surprises, enabling businesses to evaluate total cost per employee accurately and make informed staffing decisions.

Entity Ownership & Compliance

Do you own your legal entities, or use local partners?

Owning legal entities ensures direct compliance control. SOS owns its Philippine entity, enabling faster onboarding and oversight. In countries without direct ownership, we partner only with vetted entities that meet strict labour law, tax, and payroll standards. This hybrid approach balances speed, compliance, and risk mitigation for global staffing.

How does an EOR ensure local labour law compliance?

SOS tracks local labour legislation, ensuring employment contracts, statutory benefits, tax filings, and terminations meet requirements. Our HR and legal teams update policies continuously, reducing penalties or legal exposure. Partnering with SOS transfers compliance responsibility to experienced professionals who handle employment obligations daily, giving businesses peace of mind.

How does an EOR protect our intellectual property (IP) and employee data?

SOS safeguards IP and sensitive data via NDAs, IP assignment clauses in contracts, and ISO 27001-compliant secure storage. Data is encrypted and access-controlled, complying with GDPR and local privacy laws. This ensures clients retain ownership of intellectual property while maintaining secure, legally compliant management of employee information.

What is the risk if my EOR doesn’t own its entities?

Relying on third-party partners without oversight can cause slow onboarding, compliance lapses, and legal liability. Non-compliant partners may incur fines for misclassification or late filings. Choosing an EOR that owns entities, or rigorously vets partners, reduces risk and ensures timely compliance, protecting your business from operational and legal exposure.

How does EOR handle multi-country compliance?

 A professional EOR monitors local labour laws, tax obligations, and statutory benefits across jurisdictions. SOS leverages owned entities and vetted partners to maintain consistent compliance worldwide. This enables seamless expansion without exposing your company to penalties, while providing standardised processes and documentation, making international hiring simple and legally secure.

Service & Delivery

Will we get a dedicated account manager, and what are response times?

Every SOS client receives a dedicated account manager with senior outsourcing experience. Standard queries are answered the same day; urgent issues within two hours. This single point of contact understands your business context, reducing handovers and delays. It ensures fast, personalised service and immediate problem resolution for operational efficiency.

What services are included in an EOR agreement?

SOS manages legal employment, payroll processing, statutory benefits, onboarding, tax filings, and employment contracts. Optional HR support, recruitment, and benefits upgrades are also available. The EOR acts as the compliant in-country employer, enabling your team to focus on core business while SOS ensures all employment obligations are met professionally.

Can an EOR manage both contractors and full-time employees?

Yes. SOS can employ full-time staff and manage contractors through a compliant Agent of Record (AOR) model. Proper classification avoids penalties. This dual approach allows organisations to maintain a blended workforce under one provider, simplifying compliance and administration without compromising legal or operational standards.

What level of reporting and documentation is provided?

SOS provides detailed payroll reports, compliance records, and statutory filings for each employee. Documentation is standardised and accessible, ensuring audit readiness. Transparent reporting supports internal decision-making, external compliance audits, and board reporting. Businesses gain visibility into employee costs and statutory obligations without administrative overhead.

How flexible is an EOR contract if my needs change?

SOS contracts are month-to-month with a 30-day notice period. No exit penalties are applied. If you expand, reduce, or relocate teams, the EOR can adjust services accordingly. This flexibility allows businesses to scale confidently, test new markets, and make changes quickly without being locked into rigid contractual commitments.

Onboarding & Employee Experience

How quickly can you onboard an employee?

In the Philippines, SOS completes onboarding in as little as five business days after agreements and documentation are in place. Other countries vary based on local registration and compliance processes. Our speed is achieved through entity ownership and vetted partner networks, ensuring new hires start work promptly with complete legal and payroll setup

How is employee payroll handled across countries?

SOS processes payroll locally, in compliance with statutory requirements. Employees receive timely payments in their local currency. Taxes, social security, and other statutory contributions are filed automatically. This ensures consistent payroll management across geographies, reduces errors, and provides employees with reliable, legally compliant compensation without administrative headaches.

What benefits and statutory contributions are managed by an EOR?

SOS handles mandatory social security, health insurance, and other local statutory benefits. Optional packages such as private health insurance or retirement plans can be included. By managing benefits centrally, the EOR ensures compliance, supports employee satisfaction, and alleviates HR burden for your company, while keeping costs transparent and predictable.

Can employees work remotely or across different regions?

Yes. SOS supports remote employees globally, ensuring labour law compliance, tax registration, and payroll processing. Our systems track location-specific requirements and statutory obligations, allowing staff to work in different regions without risking compliance issues. This flexibility suits distributed teams and modern hybrid workforce needs.

How are employment contracts structured?

Contracts are tailored per country, including statutory obligations, IP clauses, and termination policies. SOS ensures legal enforceability and compliance with local labour law. Contracts are standardised for clarity and risk reduction, while flexible enough to incorporate client-specific policies, enabling seamless management of global employees.

Risk Management & IP Protection

How does an EOR help mitigate employment risk?

By acting as the legal employer, an EOR ensures compliance with labour laws, employment contracts, tax obligations, and statutory benefits. SOS takes responsibility for regulatory risk, reducing fines, disputes, and misclassification. Businesses gain peace of mind knowing employees are legally employed, and compliance is actively managed.

What happens if there is a regulatory change in a country?

SOS monitors legislation in all operating regions. Regulatory changes trigger updates to contracts, payroll, and compliance processes. Clients are notified promptly. This proactive approach ensures continuous compliance, minimises exposure to penalties, and allows businesses to operate globally with confidence, avoiding disruptions due to sudden legal changes.

How does EOR protect company IP with employees?

 Intellectual property is safeguarded via NDAs, IP assignment clauses, and secure contract enforcement. SOS ensures that all work product legally belongs to the client and confidential information is protected. Employees understand ownership obligations, reducing IP risk while enabling smooth collaboration with distributed teams.

What data privacy measures are in place for employees and clients?

SOS follows GDPR and local privacy laws, encrypting and controlling access to employee and client data. ISO 27001-aligned security protocols ensure secure storage, transfer, and processing. Data handling policies minimise breach risks, maintaining confidentiality and regulatory compliance while providing clients and employees with legal assurance.

Can an EOR assist in scaling teams internationally?

Yes. SOS provides global staffing solutions, combining owned entities and vetted partners. Compliance, payroll, benefits, and onboarding are managed consistently across borders. Businesses can expand quickly without setting up multiple entities

Why This FAQ Helps Buyers Choose the Right EOR

By answering these 7 core buyer questions, you can quickly assess whether an Employer of Record (EOR) is the right fit for your global hiring needs. If you need a personalised breakdown, our team can provide:

  • Country-specific compliance reports
  • Cost comparisons vs. setting up a local entity
  • Hiring timelines for your target markets

Next Steps

📩 Book a free EOR consultation – We’ll help you understand costs, compliance, and hiring speed in your target countries.

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