{"id":95500,"date":"2024-02-26T15:59:26","date_gmt":"2024-02-26T07:59:26","guid":{"rendered":"https:\/\/linksinternational.com\/?p=95500"},"modified":"2024-06-27T16:25:28","modified_gmt":"2024-06-27T08:25:28","slug":"what-is-peo-and-how-does-it-work-compared-to-eor","status":"publish","type":"post","link":"https:\/\/linksinternational.com\/en-sg\/blog\/what-is-peo-and-how-does-it-work-compared-to-eor\/","title":{"rendered":"What is PEO and How Does it Work Compared to EOR?"},"content":{"rendered":"\n

Expanding globally opens doors to growth, yet it also introduces complex hurdles. From grappling with diverse regulations to effectively managing human resources, businesses face multifaceted challenges. Essential to overcoming these obstacles is grasping solutions like PEO – Professional Employer Organisation and EOR<\/a> – Employer of Record, which have become more widely used in recent years. For instance, the global EOR market is expected to have a compound annual growth rate (CAGR) of 12.07% by 2030 \u2013 with the market size reaching US$ 3745.43 million by that year, according to Yahoo! Finance.<\/p>\n\n\n\n

These entities play vital roles in ensuring compliance with local laws<\/a> and facilitating smooth expansion. In this blog, we’ll delve into how PEOs and EORs are used in international business expansion, understanding their core differences, and what to consider when expanding a business with them.<\/p>\n\n\n\n

<\/p>\n\n\n\n

How does a PEO operate vs. an EOR?<\/strong><\/h3>\n\n\n\n

The core distinction between how PEOs work as opposed to EORs is in their specific role as employers:<\/p>\n\n\n\n

<\/p>\n\n\n\n\n
Aspect<\/strong><\/td>\nPEO<\/strong><\/td>\nEOR<\/strong><\/td>\n<\/tr>\n
Employment Relationship<\/td>\nPEO vendor becomes the co-employer of the employee along with the client company. PEO and client share legal responsibilities.<\/td>\nEOR hires the worker as their own employee, and seconds the employee back to the client. EOR fully shoulders all legal responsibilities.<\/td>\n<\/tr>\n
Employment Contract<\/td>\nEmployees sign two employment contracts \u2013 one with the PEO provider and one with the client.<\/td>\nEmployees sign only one employment contract which is with the EOR provider.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n

<\/p>\n\n\n\n

To elaborate, both may offer a host of HR services such as payroll<\/a>, administration, and regulatory compliance \u2013 but the extent to which they offer these services will vary. Secondly, as employers, there is a distinction between how much control, responsibilities and liability they have.<\/p>\n\n\n\n

Read also: <\/strong>All your Frequently Asked Questions on PEO and EOR Answered!<\/strong><\/a><\/h4>\n\n\n\n

What are the key differences between the two?<\/strong><\/h3>\n\n\n\n