5 EOR Service Myths Debunked

5 EOR Service Myths Debunked

In the world of business, being misinformed can lead to missed opportunities and misguided decisions. It’s essential to have all the facts before making any strategic moves.


When expanding a business internationally, there are several aspects to consider, from where and which markets to penetrate to the logistics of establishing a presence in those markets. A flexible employment solution that is growing in popularity recently is using an EOR (Employer of Record).


But with everything that’s new and popular, there tends to be misinformation that could prevent success. That's why we are separating fact from fiction, debunking EOR service myths so that no business will lose the opportunity to prosper internationally.

Myth #1: EOR Services are Only for Large Corporations

EOR services are not exclusively reserved for large corporations, in fact, small businesses and startups can greatly benefit from utilising EOR services in terms of streamlining the global hiring processes, keeping in compliance with local labour laws, and accessing a wider talent pool.

By partnering with an EOR such as Innovare, small businesses can expand their operations internationally without the need for establishing legal entities in foreign countries or spending a large amount on corporate insurances, thus saving time and money. Third-Party liability insurance and Common Law insurance, which are often disregarded, are rarely offered by management companies apart from Innovare.

Myth #2: Using an EOR Service Means Losing Control Over Your Employees

Partnering with any entity can feel like a loss of control, but it's simply outsourcing aspects of the business to experts for a seamless and successful outcome.


An EOR handles an employer’s HR and administrative work and does not exert control over the day-to-day affairs of the business. Decisions regarding how the company operates, how much employees are paid, etc stay with the business's management team.


For example, an EOR is there to advise and carry out specific HR functions, and act as your consultant on key issues like labour laws and employment practice, while also handling the paperwork and onboarding that comes with it. In order to effectively manage your budget, it is essential that you possess the necessary information.


Myth #3: EOR Services Are Too Expensive


It's crucial to recognise the value an EOR brings to a business that goes beyond finances. While cost is a factor, it shouldn't be the sole determinant. It's essential to consider both the internal handling and outsourcing options.


Compliance with local employment regulations is a key aspect of EOR services. Partnering with an EOR that understands labour laws, ensures compliance and prevents penalties that would otherwise be costly to fix. An EOR also possesses the ability to support a business’s specific needs, offering expertise-tailored solutions, that would help streamline operations and improve efficiency.


While cost matters, don't overlook compliance and support when selecting an EOR. Prioritising these factors alongside cost will lead to informed decisions for long-term success.

Myth #4: Employing Workers Through an Employer of Record Service is Unjust or Unethical

Employing workers through an EOR service is an efficient and compliant practice that can offer numerous benefits to businesses as they ensure that businesses remain in full compliance with local labour laws and regulations. These services specialise in navigating the complexities of employment laws, tax obligations, and payroll requirements in different jurisdictions. By partnering with an EOR provider, companies can avoid potential legal risks and penalties associated with non-compliance.


Outsourcing employment functions to a reputable EOR provider can enhance ethical practices within organisations in terms of managing employee relations, ensuring fair compensation and benefits, and promoting a safe working environment.

Myth #5: Hire multiple service providers for support


An established EOR provider like Innovare will offer a wide range of services specifically designed to assist businesses looking to scale in APAC. It is their primary business to understand the complexities and challenges associated with international expansion.


Partnering with an EOR allows businesses to access a comprehensive suite of services that cover various aspects such as payroll management, compliance with local labour laws, tax obligations, employee benefits administration, and more. This simplifies communication channels and eliminates the need for engaging multiple service providers and ensures seamless coordination across all areas of regional operations.


Expanding your business internationally requires a lot of moving parts in order to do it successfully. An EOR service allows a business to focus on its core competencies while leaving the administrative burdens of employment to the experts. This improves operational efficiency and enables companies to allocate resources more effectively towards strategic initiatives and business growth. It also provides businesses with peace of mind regarding legal compliance while enabling them to streamline their operations and prioritise their core objectives.