How to Switch Your EOR Provider

Employer of Record (EOR) providers help companies hire top talent from across the globe, maximising revenue capabilities while navigating regulatory compliance. But once you’ve signed the dotted line, you might find that your chosen provider isn’t quite right for your business.

Below, we’ll walk through some of the reasons you might want to switch EOR providers before diving into how you can navigate the process seamlessly. Then, we’ll touch on how to pick the right EOR provider for your needs—and why you should work with Omnipresent specifically.

Why You Should Switch EOR Providers

There are pros and cons to using an EOR, whether or not it’s required in a given international context. Not every relationship will be a 100% perfect fit, and that’s okay. But, when the negatives start to outweigh the positives, it’s time to start looking for a replacement.

There are many reasons why you might want to find a new EOR. For example:

• You encounter hidden complexities and costs – If you find yourself struggling to understand the fees and pricing on your EOR’s invoice, they might be hidden by aggregated figures or lost among too many line items. Without understanding your costs, financial planning becomes challenging. While your EOR should be saving you time (and money), you end up spending more just trying to interpret their invoices.

• Your EOR lacks the human touch – Automation has been a significant benefit for organisations worldwide, becoming increasingly necessary to keep pace with any market. However, some EOR partners may rely on it exclusively—providing partners with a technology platform and little else. And if your organisation is progressing through a merger, acquisition, divestiture, or other major initiatives, you may need more guidance than customer support and help centre articles.

• Your EOR isn’t proactive in helping you navigate global employment trends – You should never find out too late if your organisation risks noncompliance with global employment laws and regulatory environments. Your EOR partner should be keeping you current on relevant employment laws with advanced notice—such as the USA’s new maternity leave and the UK’s new flexible working entitlement rules.

If one or more of these issues apply, it may be time to switch EOR providers.

How to Switch Your EOR Provider

One of the reasons switching EORs can be a seamless process is that there are plenty of options available. Experts note that the rise in work flexibility in general and remote work in particular has fueled a rise in cross-border employment—and EORs—since the COVID pandemic in 2020.¹

And, looking ahead, the options available to you should open up even further, as the EOR market itself is projected to grow exponentially, eventually surpassing $3.745B by 2030.²

However, all that variety can be both a blessing and a curse.

Picking the right EOR partner comes down to following a simple, four-step plan—

Step 1: Assessing Your Existing EOR Arrangement

The first thing you’ll need to do when switching EOR partners is evaluate what’s working with your existing one. On the one hand, that means looking at the strengths of the relationship, like which workers they’re managing, where, and how they’re minimising inefficiencies there.

On the other hand, you’ll also want to look out for tell-tale signs of a problematic EOR vendor:

• Cutting corners for efficiency but falling into satisfaction or compliance pitfalls
• Attempting to do too much and being a jack of all trades but a master of none
• Exaggerating or misrepresenting offerings (i.e., “tax evasion”) or capacities
• Offering shockingly low prices or discounts relative to other providers
• Having (and potentially hiding) a history of legal or reputational trouble

And if you can’t tell whether your existing EOR has these issues, that is a red flag in itself!

Step 2: Researching Potential New Providers

To fully understand your existing EOR relationship in context, you’ll need to compare it against what’s available from other providers on the market. So, you should reach out to prospective partners to learn about the specifics of their platforms and use cases.

As you research, be on the lookout for green flags in potential EOR partners, such as:

• A balance of intelligent automation and the human touch
• Employee experience as a priority and area of expertise
• Coverage around the world and various regulatory contexts
• True value (i.e., retaining quality) rather than artificial affordability
• Agility and proactivity to adapt to new and emerging circumstances

Ideally, you want an EOR with multiple (or all) of these general qualities as a baseline.

Step 3: Planning and Executing the Transition

Once you have a sense of how your EOR relationship compares with other potential partners, it’s time to set the gears in motion and begin the actual EOR switch. Together, you’ll need to:

• Plan for and begin drafting employment contracts for all impacted workers
• Strategise by meeting with workers one-on-one to inform and consult them
• Facilitate any necessary personnel moves, like resignations and re-hires
• Review logistical issues related to payroll, immigration status, etc.

The best partners will work with you on all of these processes, laying out plans well in advance and adjusting on the fly to ensure that all impacted workers and team members are on board and supported. It’s important to take a long-term and continuous view of the transition.

Step 4: Evaluating Post-Transition Outcomes

The process is not finished after making the switch. You’ll need to evaluate how the new EOR is performing and how your staff and overall company are faring after the change. On one level, this means plotting traditional HR metrics like employee satisfaction and retention, along with operational KPIs like client acquisition costs or projected revenue per impacted employee.

Another critical consideration is compliance. You need to ensure seamless compliance during and after your EOR switch. The new provider should maintain or improve on any monitoring and assessment practices your provider EOR had in place. Ideally, these processes should produce the same or better results more efficiently, reducing costs alongside regulatory risks.

If you’ve chosen the right EOR partner, you’ll be happy with the outcomes you see.

Assessing EORs: A Practical Example:

German employment laws provide a clear example of why it’s important to determine whether your EOR can provide the necessary expertise. Traditional EORs cannot operate in Germany because the law:

• Does not recognize co-employment or dual employment arrangements

• Classifies EORs under “employment leasing”, requiring any EOR operating in Germany to hold an employment leasing licence

• Only permits “employee leasing” to third-party companies (i.e., your EOR) for 18 months at most

So, if you partner with an EOR that doesn’t hold expertise in German employment laws and attempts to operate in Germany the same as they do within the rest of the European Union, you will encounter compliance problems.

In contrast, an EOR that proactively identifies and walks you through all the nuances or hidden legal obstacles is necessary—like Omnipresent and our VEO model for virtual employment, which is tailor-made for organisations looking to hire German staff for longer than 18 months, recognize staff seniority, and further customise contracts.

Which EOR Provider Should You Choose?

Many different factors make an EOR the ideal choice for any given company. Most importantly, your new EOR provider needs to reassure employee(s) that they’ll experience a smooth and secure process from start to finish, with as little disturbance to them as possible.

So, here are the most important features to seek out in an ideal partner.

Feature 1: Help Getting Started

Before you notify your current EOR provider, your new partner can and should get the onboarding process started. They can enroll you and your team members into a user-friendly platform, from which you can upload employee information, let your EOR know what contractual terms you’d prefer (e.g., number of annual leave days), and keep track of the onboarding process. It’s also a place to safely collect and store necessary documents.

Once you’ve input all the information your partner needs, they can immediately start generating new offer letters (if required) and employment contracts for the transferring employees in compliance with all local laws and regulations and using your preferred terms.

At Omnipresent, our expert team is able to answer any questions you have about the draft contracts and terms before they reach your team members.

Feature 2: Dedicated Team Preparation

Your next EOR partner should set up individual or group meetings with the transferring employees to ensure they’re informed and comfortable with the process and let them know why it’s happening. This might be required, such as in a business transfer in the UK. And, even if it’s not, working closely with workers ensures they’ll be as productive as possible post-switch.

Once consultations are over, your EOR will be ready to transfer employees over.

Process-wise, at Omnipresent, we ask you to send them new offer letters and employment contracts to sign with Omnipresent or one of our trusted local partners. Once signed, we’ll then request that all transferring employees hand in their notices to their current EOR provider(s).

Feature 3: Seamless Logistical Onboarding

An ideal EOR provider should leverage a range of market-aligned statutory and supplementary benefits for employees. During the transfer process, friendly employee benefits experts are on hand to facilitate onboarding, no matter which regulatory hoops you need to jump through.

On a more personal level, your ideal EOR partner should set up one-to-one consultations with your team to understand what they’re eligible for according to their local jurisdiction, how they can enroll family members in healthcare plans, etc.

Omnipresent takes over employment and manages payroll on your behalf from the time you sign on. Even better? Our customer success team is an email away if you ever need them!