Employer of record services (EOR services) are global HR management solutions where a professional third-party provider legally employs workers in a target country on behalf of a client company. Under this legal framework, the EOR provider assumes full employer liability for local labor law compliance, payroll administration, tax filings, statutory benefits, and work authorization.
In an EOR framework, operational responsibilities are divided through a structured tripartite relationship:
- The Client Company: Retains direct operational authority, managing the employee’s daily duties, project deliverables, performance evaluations, and core intellectual property (IP).
- The EOR Provider: Serves as the official legal employer on paper, issuing locally compliant employment contracts, processing multi-currency payroll, and ensuring alignment with local labor regulations.
- The Employee: Executes operational tasks for the client while receiving statutory protections, localized benefits, and official payroll from the EOR.
A common point of confusion for expanding businesses is the distinction between Employer of Record (EOR) services and Professional Employer Organization (PEO) services:
- EOR (Employer of Record): Does not require you to have a local legal entity. The EOR becomes the sole legal employer, allowing you to hire in new markets within days.
- PEO (Professional Employer Organization): Operates under a co-employment model, which requires your company to already own a registered local subsidiary or legal entity in the destination country.
Utilizing strategic employer of record services mitigates the legal, financial, and operational hurdles of international market entry. Here is a detailed look at the core benefits EOR services deliver:
Navigating foreign employment laws (such as Vietnam’s Labor Code 2019) involves strict statutory rules regarding working hours, overtime caps, mandatory severance pay, and termination protocols. Non-compliance can result in severe financial penalties, operational shutdowns, or legal disputes.
By leveraging employer of record services, legal liability is transferred to the EOR provider. The EOR ensures all localized employment agreements, probationary periods, and termination processes strictly conform to current statutory standards.
Cross-border payroll management requires navigating complex tax codes, multi-currency conversions, and statutory deductions. Professional employer of record services streamline this by calculating gross-to-net pay, executing timely salary disbursements, and withholding accurate Personal Income Tax (PIT) and compulsory social contributions.
Furthermore, working with an established EOR eliminates tax compliance headaches, such as Foreign Contractor Tax (FCT) exposure or permanent establishment risks for overseas businesses.
To attract top global talent, companies must offer localized, competitive compensation packages that go beyond basic statutory mandates. EOR providers manage statutory insurance—such as Social Insurance (SI), Health Insurance (HI), and Unemployment Insurance (UI)—while providing access to supplementary corporate benefits, including private health coverage, annual wellness checks, and local pension plans.
Relocating expatriates or hiring foreign experts into foreign jurisdictions involves rigorous immigration workflows. In Vietnam, foreign workers must secure labor demand approvals, valid Work Permits, and Temporary Residence Cards (TRC).
Comprehensive employer of record services handle the entire immigration lifecycle—from foreign labor quota approvals and Business Visas (DN1/DN2) to Work Permit applications and TRC sponsorship—ensuring foreign talent is legally authorized to work without administrative delays.
A key concern when hiring remote or cross-border talent is safeguarding proprietary code, patents, and sensitive corporate data. Premium employer of record services incorporate robust IP assignment clauses and non-disclosure agreements (NDAs) directly into local employment contracts, guaranteeing that all intellectual property created by employees automatically transfers directly to your business.
Partnering with an EOR service provider involves a seamless 4-step operational workflow:
- Talent Identification & Scope Alignment: You recruit and select the candidate you wish to hire. The EOR evaluates local labor regulations, tax structures, and mandatory benefits to structure a compliant offer.
- Compliant Contract Execution: The EOR drafts a locally compliant employment contract adhering to country-specific employment laws and issues it to the candidate along with necessary IP clauses.
- Onboarding & Mobility Management: The EOR executes background checks, secures necessary visas or Work Permits (if applicable), registers statutory insurance, and sets up local payroll.
- Ongoing Operational HR & Management: While you manage the worker's daily performance, the EOR handles recurring monthly payroll, tax withholdings, statutory filings, expense reimbursements, and eventual offboarding protocols.
Manpower Vietnam is a market leader in delivering tailored employer of record services, backed by over 75 years of global HR experience from ManpowerGroup. We enable multinational companies and growing startups to enter and scale in Vietnam without the costly, time-consuming requirement of establishing a local entity.
Leveraging deep local expertise in Vietnamese labor codes, tax laws, and expat immigration procedures, Manpower Vietnam guarantees 100% compliance across the end-to-end workforce lifecycle. Our transparent operational model provides you with full oversight and control over your human capital costs.
In addition to full-service employer of record services, Manpower Vietnam provides an integrated ecosystem of workforce solutions:
- Executive Search & Permanent Recruitment Services
- Staffing & Labor Outsourcing Services
- Payroll Outsourcing Services
- HR Consulting, Expatriate Services (Work Permits & TRC), and Outplacement
Partner with Manpower Vietnam today to streamline your expansion. Contact our experts to learn more about our employer of record services and explore our innovative workforce solutions.
