Employer of Record (EOR)

An employer of record (EOR) is the entity that is the legal employer of a worker for payroll, tax withholding, and compliance purposes, even though a different company directs the worker's day-to-day tasks.

In staffing, the agency typically acts as the employer of record: it hires the worker, runs payroll, withholds and remits taxes, and carries workers' compensation and unemployment insurance. The client company supervises the actual work on site.

Separating the legal-employer role from the day-to-day supervisor is what lets a client bring on workers quickly without adding them to its own payroll or taking on the associated administrative burden.

Related terms

Related staffing services