Employer of record (EOR) services in Vietnam

This article will tell you everything you need to know about how employer of record services work, what kinds of services employers of record perform in Vietnam

Today's business environment is changing very rapidly, an efficient and productive company is the key to success which means that a company and organization desperately needs the right people at the right time. the point. As one of the leading companies in Vietnam in the field of HR consulting and providing Human resources, we provide the best Employer of records solutions in Vietnam. Check out our EOR service below

What is an employer of record (EOR)?

An employer of record (EOR) is a global provider of employment services (between different countries) that helps you legally recruit workers in other countries. EOR services help you handle payroll, benefits, taxes and compliance with local laws, thereby helping you focus on the company’s core activities.

Businesses rely on recruiters with profiles to help them hire employees in many countries. With EOR, a company can expand operations into another country without having to set up a local organization, which can be expensive and take months or longer to complete. Working with EOR allows businesses large and small to recruit and pay workers in other countries quickly and affordably.

The Vietnamese market in recent years has been growing rapidly. Vietnamese workers are highly skilled, intelligent, and the cost is very reasonable. Therefore, this is a new and potential market for foreign investors who want to expand their business activities into Southeast Asia.

Want to learn more about recruiters with profiles, Vietnam jobs and payroll? We’ve put together this helpful guide to help you understand everything you need to know about EORs and how they work.

What are employer of record (EOR) services?

Employer of record allows companies without a local legal entity to legally employ workers in other countries. An EOR firm handles payroll, the administration of employee benefits, as well as tax documentation.

When it comes to project-related work, the EOR company doesn’t intervene in workflows, offering business owners full management freedom.

Other employers of recording services may include consulting services for companies looking to expand their teams into new markets. For example, an EOR might offer advice on how to integrate remote workers or how to create a global compensation plan.

Employer of record in contract staffing

When applied to recruiting agencies offering contract staffing, the employer of record serves as the legal employer for contract employees. The employer of record responsibility often falls onto a third party known as a contract staffing back office. Recruiters can take on the back office responsibilities themselves, but recruiters can also outsource the responsibility to a contract staffing back office.

Suppose you choose to add contract staffing to your recruiting business. In that case, you need to decide who will be the employer of record for your contractors.

Also, if you decide to run the back office yourself, you must ensure you have the time and resources.

Lastly, suppose you don’t want to run the back office yourself. In that case, a contract staffing back-office provider can take responsibility from you. The employer of record will handle staffing agency (recruiter) payroll funding, pay the workers, and handle all payroll and employment responsibilities.

Functions of Employer of Record (EOR)

A global employer of record (EOR) is a third-party service that enables small, medium, and enterprise-level businesses to outsource recruitment and employee management activities. It can handle everything from legal compliance to payroll processing for your employees working in different countries.

For example, if your company exists in the United States and you want to hire an employee in Vietnam, you can do so using EOR.

The Employer of Record’s main services includes employee onboarding, record maintenance, payroll, tax filing, commissions, health insurance, and other employee benefits for your business. 

An employer of record can legally perform several HR and legal functions, including:

  • Allowing businesses to hire full-time employees in other countries Administered legally
  • Ensure compliance with local labor and tax legislation (e.g., drafting valid contracts and agreements).
  • Arrange visa-related documents and work permits in case the relocation of an international employee is necessary.
  • Fill in tax and insurance (health and social insurance) forms on the employer’s behalf.
  • Payroll for employees in other countries
  • Handles global worker benefits management
  • Manages international contractors
  • Distributes employee equity options across borders
  • Offer consultant services to the company regarding the best practices of employee onboarding, severance pay, or contract termination in the region.
  • An employer with a record can also help businesses that employ workers in other states or regions within the same country. For example, a HCMC company might use a profiled employer for hiring a worker in Hanoi.

05 Benefits of Hiring an Employer of Record

Collaborating with EOR vendors is a commonplace practice for global companies. Reaching out to a company that can become an intermediary between a business located in a different country and the local government helps business owners mitigate risks, reduce management costs, and improve team efficiency.

Let’s take a closer look at the main benefits of hiring an employer of record:

Although building teams abroad has many benefits (affordable workforce, larger talent pool, workplace diversity), many business owners are wary of looking for talent abroad because of the challenges that come with registering a business entity abroad.

All this time, business owners are in an undefined state, unsure whether they should keep trying to break in or focus on hiring talent at home and give up on a global office.

How EOR helps: an employer of record is an officially registered company with an approved right to hire and pay employees. Thus, hiring an EOR vendor allows business owners to start looking for talent abroad and working on projects immediately.

The laws of each country have their own requirements to ensure the rights and interests of both employers and employees. In particular, for employees in Vietnam, there are many related regulations, decrees and circulars: Labor law, tax law, social insurance law, health insurance law, tax law, … Therefore, new businesses entering the Vietnamese market are often quite confused when they have to apply it properly.

How EOR helps: to avoid such situations and manage teams in a legally-compliant way, business owners rely on employers of record. EOR agencies have a firm grasp of labor and business legislation and will make sure all the processes within the company are compliant. If a breach of law occurs, the business owner does not have to take responsibility — the employer of record will be liable.

Keeping track of paperwork, administering benefits, running payroll, and terminating employee contracts takes much time. Business owners do not spend enough time on the company’s core activities, trying to juggle dozens of management tasks independently. They can not improve the product, build strategies, and foster meaningful connections with clients or partners.

How EOR helps: having a vendor who takes care of tax payments, employee payroll, and other formalities saves company managers much productive time.

By collaborating with an EOR, business owners can improve their skills in areas they are passionate about and skilled in rather than spending hours researching international laws and procedures.

A lot of costs are associated with opening an office abroad, From the expenses related to establishing a subsidiary to hiring legal and financial assistants and building a team abroad.

How EOR can help: hiring an employer of record allows business owners to save up on hiring financial, HR, and legal consulting companies. The high flexibility of EOR agencies gives room for exploring new markets and closing global offices. 


Finding an employer of records is a way for business owners to shift the burden of responsibility off the organization and onto a vendor. Since the employer of record is featured in the official documentation, drafting agreements, and paying taxes, the organization will mitigate risks.

How to choose an Employer of Record Service

While there are many EOR service providers, finding the appropriate one for you means asking the right questions: Do they compatible with yours? 

Ask the Right Questions

When choosing an EOR service, a clear idea of your company’s recruitment, HR, or other administrative activities can help you know what processes require solutions. Asking yourself these questions can bring forward the specific EOR services you need to help bolster your company.

  • Do you need to hire employees but can’t yet spend more resources on establishing entities in Vietnam?
  • Is your payroll team now can handle everything? Or do you need experts for Vietnam legal compliance with your payroll processing?
  • Do you need an entire EOR service package, or do you just need to plug in the deficiencies in your HR system?
  • Have you considered the long-term costs of investing in your company with an Employer of Record partner?

Answering these questions truthfully supports evaluating priority solutions for your company. By focusing on the primary issues, you get to be more efficient with your resources. You lessen the costs of services when you fully understand your company’s needs. 

Finally, you know your company the best and can accurately evaluate the requirements. With a deep knowledge of your company, you can allot better investments and improvements, pushing your growth forward.

Employer Of Record Vs PEO, What different?

Professional Employer Organization (PEO) is similar yet has differing functions compared to the Employer of Record. 

PEOs and EORs handle employee management and administrative activities such as tax compliance, payroll, benefits, and HR. PEOs, however, do not have legal responsibilities for employment. 

Since a PEO is a co-employment organization, you are only “leasing” their employees to work for your company. This means that when you want to hire internationally, you need to establish legal entities in your target countries, entailing more risk for costs and compliance.

With PEOs, you are provided the services for employment but not compliance. If you want a more thorough service without upfront costs, it’s best to choose Employer of Records solutions. Suppose you have established entities in other countries and need assistance in the hiring process and employee management. In that case, PEOs will work for you.

How much does an Employer of Record cost?

EOR pricing structures have two types: percentage rates and flat rates.

Percentage rates get their costing from your employees’ salaries. This structure seems to be a good option with a small workforce. However, retaining experienced employees through promotions, incentives, and wage raises can prove more costly in the long term.

Percentage rates used to be the industry standard; however, more and more companies are transitioning to flat rates due to the affordability of this structure long-term.

With flat rates, you only pay for the service per employee. An Employer of Record costs depends on the requirements of each employee.

Knowing this can open up more opportunities to budget your resources or invest in better projects for your business

Why choose NIC Global?

We are leading the EOR services in Viet Nam. With more than 20 years of experience in the HR field, we completely serve you all packages of EOR services such as recruitment, payroll services, payroll software, paycheck, health and social insurance,…

You can automate your payroll processing and employee management through our software. Rest assured that our user-friendly approach can help you implement our technology seamlessly in your business.

Focus on hiring the best candidates for your role in Vietnam, and we’ll handle the rest. Simplify everything with a click of a button. Simplify with NIC Global

Learn more about EOR in Vietnam

All companies can use Employer of Record in Vietnam. Especially you have a plan to expand your market to Vietnam or Asia, employing Vietnamese staff with EOR services before establishing an entity is the suitable decision

The short answer is yes, but doing so either requires you to open your own legal entity in Vietnam or employ the workers as contractors. Both strategies have their pros and cons.
If you open your own legal entity, you will be responsible for managing your entire presence in Vietanm. That means hiring lawyers, payroll specialists, benefits administrators, and other professionals. Doing so may make sense if you plan to hire hundreds of people in a new country, but if you only plan to employ a few dozen, an EOR is more cost-effective.
Hiring workers as contractors requires you to be diligent. International contractor misclassification is a serious issue and can lead to hefty fines and penalties. Going through an EOR insulates your business from potential compliance risks by making workers fully fledged employees.

Your employer of record’s most considerable responsibility is acting as the local employer on paper for your employees in other countries. Your EOR shields your company from liability and compliance risks by employing workers legally on your behalf.

In addition, an employer of record handles the complicated HR work that accompanies hiring workers in Vietnam. In particular, the Labor Law of Vietnam is updated daily. You don’t need to know: which currencies are allowed, how much paid time off employees must receive, and so on.

We’ll manage all of these complexities on your behalf, so you can spend less time on administrative work and have more time growing your business.
Significantly, An EOR is not involved in managing the employee’s tasks or performance. You work with employees employed through an EOR the same way you work with any other employees. The only difference between an employee in your office and another under EOR is who handles the paperwork.

Yes, it is entirely legal to hire employees in Vietnam through an EOR. Some EORs are more compliant than others.

Only EORs that own their entities can guarantee the maximum level of compliance everywhere they operate. Before you begin working with an EOR, make sure your EOR owns a local entity and has good experience in handling localized payroll, benefits, taxes, and compliance