Mid-2024: Where Are Leading Employer of Record Companies Heading To?

With the embrace of remote work, Employer of Record becomes a vital solution when a company wants to expand globally to reduce the burdens of employment-related matters and risks of non-compliance issues.

The Global EOR industry market size was valued at USD 4.3 billion in 2021, and is expected to expand at a CAGR of 6.8% during the forecast period, reaching nearly double at USD 8.05 billion by 2031. (Bussiness Research Insights)

The numbers are quite humble when I put them alongside other established markets with overlapped functions like HR outsourcing (valued at USD 18.65 billion in 2023) and payroll services (valued at USD 75.21 billion in 2023). However, they suggest that this emerging market has gained significant adoption and is leaving room for further growth and innovation on the cusp of maturity.

That’s why I examine leading EOR companies more closely to understand their priorities for the future and will share them with you in this article. 

Sneak-peek: they’re all in different directions!

Before we jump in, I want to correct a misconception about an employer of record solution. 

People often assume that EOR is a tech platform. But in fact, it begins with and relies on the compliance service.

• You need to sign a contract (legally) with an employee, but you don’t have an entity yet. You need to borrow one.
• Your employee needs to be provided with the statutory benefits and compensations associated with their employment status. You need help.
• Your employee has to be paid on time. You need a system to run payroll across borders under the right obligations. 

From there, technology is developed to make things easier, better, and faster for all parties involved (the EOR employer, the ‘real’ employer, and the employees).

• You can onboard employees on your own with expert-approved employment contract templates and misclassification-proof tools.
• You can set up payroll schedules for your requirements, automate it, and adjust payments when needed without back-and-forth email threads.
• Your employees can see their information and make requests easily regarding administrative issues.

And many more at many different levels. That said, expertise is the cornerstone of this model, and technology platforms can be their competitive edge in today’s digital, fast-paced era.

Having this understanding makes it easier to comprehend what we discuss next on what makes these EOR vendors unique:

Deel: Developing HRIS to Compliantly Manage an Entire Global Workforce

Founded in 2019, Deel grew from zero to over $500 million ARR in five years and has rapidly become a formidable force in the EOR space.

In 2023, Deel launched its HRIS software after a few successful acquisitions. Deel HR platform offers helpful features that are suitable for modern teams:

• Create and manage the org chart and people directory of the worldwide team 
• Manage PTO and expenses
• Request, add, and store documents with enterprise-grade security
• Build and distribute career pathing frameworks, training materials, and learning courses to employees
• Conduct performance reviews, pulse surveys, and engage with employees via Slack integration

See our comprehensive review of Deel here.

Currently, Deel HRIS is free for teams of up to 200. That means small- to medium-sized businesses receive the most benefits from Deel’s global HR platform to manage their mixed workforce, from in-country teams to EOR employees and contractors. 

The issue with the current standard is that employees need to be onboarded for compliance on one platform and then onboarded again on another platform for productivity and engagement. 

They have to tack on yet another system to their already bloated roster. 

That’s why Deel’s movement is like a beacon for those always itching to streamline their operations and “do more with less.”

Recently, in February, Deel just announced the acquisition of AI-powered people development platform Zavvy to “fill in that missing piece of our global HR offering.”

Remote: Enhancing Remote Hiring with a Dedicated Remote Job Portal

Global employment involves more than just recruitment and onboarding; it starts with finding and connecting with the right talents. 

By nature, most EORs can't help much until the final step of making an employment contract and “officially” recruiting people, even though many offer ATS integrations, allowing you to transfer employee data from the previous stages of the recruitment process easily.

Remote, a significant player in the EOR market, takes a pioneering step in supporting talent acquisition by offering a proprietary job portal, Remote Talent, in late 2023.

“Today, talented people all over the world have more opportunity than ever to build fulfilling careers remotely – but the process of finding and hiring remote candidates is broken for both individuals and employers alike,” said Job van der Voort, CEO and co-founder of Remote. 

The way it works is similar to any other talent marketplace:

• You (employer) distribute opening positions on the niche job board for remote, hybrid, local on-site, or project-based roles with a flat fee of $119/month
• Talents visit https://www.remote.com/jobs, browse jobs, and apply for them.

Niche job boards are beneficial to recruiters by offering them access to “qualified global talent with experience working remotely and a desire to bring their skills to a fully distributed team.” 

This improvement is in line with the company's vision and mission, emphasizing equal and flexible cross-border working opportunities. 

Job van der Voort, one of the two founders, stepped out from the strong remote-first culture at GitLab, and Marcelo Lebre, the other co-founder, wished to break away from “the aspects of office-bound culture.” From the company name they chose on purpose to the signature IP protection method in their EOR offerings, all tell the same story.

“In building this new marketplace, we’ve optimized for simplicity and transparency, so it’s easier than ever for job-seekers and companies everywhere to find the perfect match without a location as a barrier.” - Job van der Voort

For now, you can use this tool alongside any EOR platform you prefer (because it charges separately). However, anytime soon in the future, if Remote ties this stronger to their EOR offerings (included package, more integrated remote hiring tools, etc.), they will make the first choice for companies looking for a seamless global find-to-hire experience.

Globalization Partners: Focusing on Being the Gold Standard in Global Compliance

In the recent podcast with Josh Bersin, Nicole Sahin, the CEO of Globalization Partners (or G-P), shared that their priority is to continue focusing on compliance expertise and aiming to set the highest standards for global compliance.

“That’s actually a core part of our strategy. Some companies in this market are really trying to be everything to everyone. They redo global payroll, redo HRIS. We feel like by focusing on global compliance and really pouring all of our resources and the brains of our brainiac teams and doing what we do best will ultimately be much more successful.” - Nicole Sahin, the CEO of Globalization Partners 

G-P is one of the leading EOR companies, since 2012 (we had no clue about remote work then!), and named an Industry Leader three years in a row in NelsonHall’s Global Employer of Record Research.

They developed a strong compliance system around the world with designated HR professionals in more than 50 countries to “make sure to be there to handhold them [clients and their employees] through complex issues.” 

This approach strengthens G-P as a pioneer in the field with extensive knowledge, experience, and solid infrastructure over the years.

“And then have a shared go-to-market with the biggest payroll in HCM companies in the world, so those companies include ADP, Paychecks, Workdays, and Trinet, all of which have different levels of partnership, but we could resell fully integrated partnerships on the roadmap with the world’s biggest HCM and payroll companies.” - Nicole Sahin, the CEO of Globalization Partners 

Even though G-P’s customer profile spans startups to multi-million dollar companies and Forbes 500 firms, it was built to better assist large enterprises, especially in complex cases like M&A transactions, rapid international expansion, or restructuring.

They also keep the G-P Meridian Entity package to offer compliance services, helping businesses set up and manage new entities when business needs require.

Final Thoughts

Employer of Record is a life-saver in the age of remote hiring and global expansion. No doubt. And they can only be better.

Divergent developments will create diverse choices that are closer to our comprehensive, long-term needs. It could be an all-in-one global employee management solution like Deel (available now), an end-to-end global employment platform like Remote, or G-P-powered EOR solutions from new HCM vendors entering the market.

Don’t worry, I’ll keep them on the radar so you are always close to the best choices. But for now, if you’re trying to enter a new market and quickly assemble a remote team, check out the best EOR services in 2024 to handle heavy employment-related matters compliantly.

Here are essential evaluation questions to help you find the right match for your requirements.