Employer of Record (EOR) refers to a service provided by specialized companies to handle employee administration and compliance with labor and tax obligations on behalf of other companies. This service is particularly useful for companies that want to expand their operations in a new country, but don’t want to establish a full legal entity or don’t have enough knowledge about local labor and tax legislation.
By utilizing an EOR service, a company outsources the legal and administrative responsibility of hiring and managing employees. The EOR becomes the “employer of record” for employees, assuming employment responsibilities such as paying wages, benefits, taxes, social security contributions, and unemployment insurance. The client company still retains operational control and direct supervision over employees.
Hiring employees in Brazil can be a complex process and involve a number of legal and tax obligations. In this context, the EOR service can play an important role and help companies that want to establish themselves in the country to simplify this process, offering:
- Legal Compliance: Ensures that all stages of hiring are in compliance with Brazilian labor laws.
- Registration and Documentation: Handles the employee’s registration process and necessary documentation.
- Payroll and benefits: Prepares the payroll, including deductions and social security contributions, in addition to administering mandatory benefits.
- Tax and social security management: Calculates, withholds and pays taxes and social security related to employees.
- Flexibility and scalability: Allows flexible contracting, adapted to the company’s needs.
- Advice and support: Provides guidance on labor, regulatory and tax issues in Brazil.
By using an EOR service to hire employees in Brazil, hiring companies can benefit from local expertise, ensuring compliance with legal obligations and compliance with Brazilian labor and tax regulations, while simplifying the hiring process. hiring and focus on their core business activities.