An Employer of Record (EOR) is a global employment solution that allows businesses to hire talent in new markets without setting up a foreign subsidiary or entity. The EOR becomes the official employer under local employment laws, managing global payroll, employee benefits, tax withholding, and compliance management.

Companies typically use an EOR when:

Entering new markets quickly without creating a local In-Country partner or subsidiary.

Hiring a distributed company workforce compliantly across multiple countries.

Avoiding compliance risk management issues such as labor law breaches or contractor misclassification.

This makes the EOR model a cost-effective pathway for global expansion and long-term global workforce strategy.

An employer of record (EOR) helps navigate complex international tax compliance and labor law requirements. Even though contractors aren’t classified as full-time employees, many jurisdictions impose tax compliance obligations, such as VAT (value added tax), TDS (tax deducted at source), or social security wages contributions. Using Topsource as your EOR means you can manage hybrid teams—contractors and employees—under one model, with compliant employment agreements, invoicing, and even contractor-to-employee transitions that preserve employee tenure, employee benefits, and employee retention strategies.

EOR (Employer of Record) takes on full legal employment responsibility, unlike staffing agencies which typically supply short-term labor.

Yes. An EOR can manage both salaried employees and independent contractors. For employees, the EOR issues complaints about employment agreements, manages global payroll, pay stubs, social security wages, and leave management. For contractors, the EOR ensures correct invoicing, Form 1099-MISC/Form 1099-NEC, and cross-border payments via SWIFT or local channels.

This dual approach enables a flexible global talent acquisition and workforce analytics strategy while ensuring international tax compliance.

Yes. Contractors can be seamlessly converted into EOR employment, allowing them to retain employee tenure, leave management history, and access to benefits like end of service gratuity, auto-enrolment pension scheme, or central provident fund (CPF) (depending on location). This transition supports employee retention, provides access to structured employee benefits, and ensures compliance with international labor laws. For businesses, it also strengthens long-term global workforce strategy by retaining top talent under secure contracts.