A professional employer organization (PEO) or employer of record (EOR) is an organisation that hires employees on behalf of the employer and seconds them back to the employer. In the case of foreign hiring, they help bypass certain barriers of entry, including the need to set up a business entity and provide additional benefits such as managing employee payroll. PEO allows businesses to have someone on the ground in as little as 48 hours.

PEO works as an outsourced HR unit supported by an external HR solution provider. Many aspects of HR is absorbed by the solution provider under a PEO model. This can vary depending on the service agreement but can include aspects such as employee administration, payroll processing, work permits, worker compensation insurance, benefits management, recruitment and onboarding, and more.

PEO is a flexible solution that allows companies to increase their workforce despite headcount and resource limitations. Good for companies looking to expand into new locations and its benefits include:

• Short implementation process (ready in 48 hours)
• Cuts cost – lowers the barrier of entry into new markets
• Save time and money
• Ensures and maintains payroll compliance
• Creates smoother HR experience for employees

PEO is a highly inexpensive solution for businesses looking to expand into a new location. Starting at US$300/Month, businesses are able to have someone on the ground without the need to set up a business entity that normally requires greater in-country capital and is often costly to set up and maintain.

As a professional HR service, PEO/EOR agencies can help you protect your business against fines and penalties by having compliance experts manage your HR function. This is especially beneficial for the management of new markets and foreign locations where you have limited knowledge of local payroll tax laws and reporting requirements, unemployment insurance, workers’ compensation, hiring and HR compliance.

Employing a PEO/EOR offers numerous advantages for international expansion. The key benefits of outsourcing employment services to an EOR include:

• Speed to market – Compliantly hire anyone, anywhere in Asia in less than 48 hours with on the ground HR support
• Flexibility & Cost – Expand into new markets without incurring the cost, commitment and timeline associated with setting up a new legal entity
• Wider Talent Pool – Access a wider talent pool by hiring in demand skillsets from anywhere in Asia
• M&A Activity – Simplifying corporate structure by closing legal entities and moving ‘orphaned employees’ under a PEO/EOR provider to save ongoing costs
• Mobility & Retention – Retain staff by allowing them to relocate anywhere in Asia and work remotely

PEO/ EOR services streamline overseas employment and payment processes through the following steps:

• Step 1: Selecting target market for expansion
• Step 2: Identifying and shortlisting candidate according to business needs
• Step 3: Sign service agreement with Links
• Step 4: Get ready for onboarding!

In most cases, payroll falls under the scope of PEO. This is especially useful for companies growing their workforce rapidly or are struggling to keep up with local regulatory compliance, MPF contributions and more.

Once payroll is set up properly management (even for multi-country) is fairly straightforward. Quality PEO services ensure your employees are paid accurately and on-time, giving companies the peace of mind that their business is fully compliant with local regulations around MPF contributions with dedicated help desk support.

Key aspects to note when deciding on a PEO partner:

• Service coverage (location & scope)
• Information security and data privacy
• Level of local knowledge and  support

At Links, we offer flexible Asia payroll services covering 19 locations across the Asia Pacific. Using a 100% in-country service delivery model, companies can safely rely on us to deliver their PEO.

Multi-country payroll refers to the process of managing and administering payroll for employees in various countries when a company has established a local entity. In other words, the organisation hires their own employees legally, themselves, whilst they outsource the administrative processing to a third-party professional firm.

In multi-country PEO/EOR, the employees are legally hired under the third-party professional PEO/EOR firm, on top of managing and administering the payroll processes for employees.

It is good to note that not all PEO/EOR firms offer payroll outsourcing services, and vice versa.

Links provides EoR services 100% from our own Links entities / team.

A multi-country PEO/EOR acts as the legal employer of the employee while maintaining constant and fluid communication between the company and the employee. A PEO/EOR service will handle the complicates bits of the process and:

• Prepare employment contract and discuss terms of employment,
• Handle payroll, HR, and labour law compliance,
• Process and disburse salary,
• Provide statutory and tax processing and lodgement,
• Offer group company insurance where applicable,
• Issue letters, statutory documents, payslips,
• Provide In-country support to payroll, HR, labour law queries,
• Provide a self-service portal to facilitate pre-approved Vacation and paid time off (if required),
• Provide visa and immigration support where needed.

On the other hand, the company utilising the PEO/EOR service will only have to handle:

• Workplace safety and compliance
• Workplace arrangements and reporting line
• Day-to-day performance monitoring
• Vacation and paid time off confirmation (if applicable)

Links and the Client maintain an open communication channel and as part of it, if there are any performance issues leading up to the termination, Client should communicate this intention to Links prior to any communication with the employee(s).  Links will advise the compliance and market practice to the client, and will support all administration needed in the termination process.

In the past, hiring remote workers was a common practice. However, both this approach and the alternative of setting up a local entity are now generally discouraged. When a worker exclusively performs tasks for a single company, their legal status can be considered misclassified. As a result, the worker may be entitled to claim full payment for social benefits, paid time off, severance payments, in addition to their monthly compensation from the company.

Some Clients sign a separate non-disclosure clause with the employee, or input certain IP protection clause in the Employment Contract.  Note that however, such laws are majorly not enforceable as part of the Labour Law in most locations.  Therefore, Links will advise the Client what is the current market practice in the location, prior to suggesting where to get employee’s consent in writing.

Yes, Links offers Group Company Insurances in almost all locations.  Note that for some locations, it is a market practice for employees to purchase their own insurance plans and employee can reimburse this paid amount via Links if needed.

Expenses claim will be added to the Total Monthly Gross Relevant Income, and is subject to the corresponding monthly fees relevant to the payout range.

Yes, we are able to provide recruitment and sourcing solution in Singapore, Hong Kong, Mainland China.

Normally, our EOR clients provide work equipment for their employees from their end. However, if needed, Links will be able to purchase the required equipment on behalf of the client and the cost will be charged back to the client.

Upon confirmation of service agreement, our team will reach out to the client to obtain necessary information pertaining to the employee. Once our team receives the information, we will prepare the employment contract according to local labour laws and reach out to the employee for signing within 48 hours.

A suitable PEO/EOR service provider offers a range of features that cater to your needs during expansion. These may include:

• High data security standards and protocols in place to safeguard your data, regardless of the hiring location with the ability to customise the platform and processes to align with your specific requirements.
• The platform should allow employees to manage their benefits and extract payslips regardless of the hiring location.
• Flexibility to offer Group Insurances on behalf of the end client.
• Commercials and Fees.