21 Best Practices For Managing Remote Teams

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Gino Peters

Written By:

Gino Peters

Reviewed By: Belinda E.

June 3, 2026 8:12 pm

Category Tag: News

The rise of remote work made international expansion much easier in recent years, but hiring abroad still comes with legal and administrative complexity, as every country has its own labour laws and payroll rules that must be followed. In addition, not many companies can open a new entity in every new market that they are expanding into. That is when the Employer of Record (EOR) solution comes in handy.

The EOR serves as the legal employer on paper, while the client company manages important activities related to the employees responsibilities and performance.

In this guide we will cover what an employer of record is, how it works in detail, how much it can cost and which business should consider an EOR solution.

What is an Employer of Record (EOR)?

An Employer of Record (EOR) is a third party service provider that legally employs a person on behalf of another company in the country where the employee officially resides. As an official employer the responsibilities of EOR include issuance of an employment contract, processing payroll and withholding taxes and necessary social security contributions, as well as preparation of offboarding documents or any documentation that need to be signed by the employer. In addition, EOR ensures the compliance with local labour laws and serves as a first point of contact for any legal disputes.

The client company that hired the employee through an EOR also has a list of responsibilities. As an Employer of Record does not have the visibility on operational activities behind the scenes a client company needs to provide direction and ensure proper team integration.

In simple terms, the EOR provider acts as a legal employer in the country of the employee’s residence, while the client company takes on day-to-day manager work.

Responsibility	Employer of Record (EOR)	Client Company
Employment contracts & any other official documentation
Payroll processing
Income tax & social security contributions
Compliance with local labour laws
Statutory benefits administration
Managing daily work and projects
Setting goals and performance expectations
Providing equipment and tools
Leading the employee’s team and workflow

Employer of Record solutions gain more and more popularity in the field of global expansion as they allow businesses to hire best candidates fast and easy while staying compliant with local employment regulations. More information about EOR service are available if you would like to understand more.

EOR Meaning

The term “EOR” is the abbreviation for Employer of Record.

Employer in this instance stands for the company that hires the employee and takes on duties related to it, such as onboarding and offboarding process, payment of wages and compliance with other legal requirements.

“Record” from the EOR perspective refers to official registration with government authorities. The name of the EOR provider is stated in all payslips and tax filings, and should also be listed by the employee in any documents where employer must be stated, such as mortgage or loan applications.

One might ask a question of why this legal structure exists. As it is not possible to provide an employment contract directly to a person that legally resides in another country, the business expanding abroad typically needs to establish a local entity. That involves legal registration, arrangement of local bank accounts and organisation of payroll structure, as well as compliance with local law.

EOR allows to simplify the global hiring and reduce administrative burden through their existing legal entity.

There are some other hiring models that can be confused with EOR.

EOR and PEO

Many sources online refer to EOR as “international PEO”, which may create confusion as these models have 1 important difference.

A Professional Employer Organisation (PEO) serves as a co-employer of a client company. In other words, a business must already have an established entity in the country. The hiring tasks are, therefore, shared between 2 companies, while legal liability stays only with the client company. In the EOR model all legal risks are being taken by the official employer. Read more about the difference between PEO and EOR here.

EOR and staffing agency

Staffing companies mainly provide assistance for short-term projects by providing temporary workers. If the client wishes to employ a person for a longer time, EOR approach must be chosen.

EOR and contractor model

Contractor agreements assume the involvement of independent workers rather than employees. This model is also often used for temporary, project-based assignments. It is important to remember that there is a big misclassification risk between a contractor and an employee in the company which can lead to potential legal issues. An EOR ensures that employment is legally compliant with local labour law.

How does an Employer of Record work?

While it may sound complicated at first, a process behind the employer of record model is relatively straightforward.

The operating company selects a candidate

The client company recruits the employee they want to hire in another country

The EOR becomes the legal employer & local employment contract is issued

The Employer of Record uses its local legal entity to prepare and issue an employment contract that complies with labour law of the country where the employee is based. Depending on case-by- case situation, the work visa might need to be secured beforehand. Our company provides immigration services, more details can be found here.

Payroll and taxes are managed

The EOR takes on recurring responsibilities related to a payroll and ensures correct processing of income tax, social security contributions etc

Benefits are administered

Paid leave, sick leave, pension contributions and any other statutory benefits are being managed by the EOR.

Ongoing compliance and HR support

It is the responsibility of the EOR to monitor changes in local labour law and ensure ongoing compliance.

Example:

Imagine a UK-based tech company found a perfect candidate in Germany for a position of a software developer.

Instead of going through the administrative burden of opening a legal entity in Germany, the company chooses to work with an Employer of Record. The EOR hires the developer under a German employment contract and manages payroll and taxes. At the same time the UK company welcomes the new employee in the team and manages the daily work of a developer.

What services does an Employer of Record provide?

The Employer of Record does more than just providing an employment contract to the employee. Typically a wide range of HR and compliance services is included in the EOR offer. For example, read about the services included in our EOR package here.

Employment and HR administration

Locally compliant employment contracts and support with other documents requested by authorities
Employee onboarding
Employee record management. For example, control over PTO

Payroll and tax management

Regular payroll processing
Tax withholding and reporting of social security contributions with authorities
Payslip generation and creation of annual wage tax certificates

Benefits administration

Management of statutory benefits
Pension contributions (where required)
Support with benefits such as maternity leave allowance, sick leave allowance etc

Compliance and risk management

Insuring compliance with local labour law
Management of onboarding and offboarding processes
Representation in difficult legal and court cases

Additional services:

Some EOR providers ( such as ThisWorks EOR Services) provide additional services such as:

Work permit and dependent visa support
Background checks
Relocation support
Value added services: support with housing, company car, banking, etc ( depending on the country).

This vast list of services allows businesses to manage international teams, while staying compliant and avoiding complex local employment administration.

Benefits of using an EOR service

There are multiple advantages the businesses can get from working with an Employer of Record provider.

Faster global hiring

Setting up a new entity can take up to several months. With an EOR the hiring process can take several days.

Reduced compliance risk

A trustworthy EOR provider ensures the compliance with all local regulations. As the labour law varies greatly between countries, having a knowledgeable party to rely on can make a big difference.

Lower expansion costs

Establishment of a new entity is not only a time-consuming process, but also costly. With EOR services these costs can be avoided.

Access to global talent

The location of a remote candidate is not a problem if the company uses Employer of Record services. In other words, the best candidate for specific business purposes can be chosen.

Scalable hiring model

EOR services are ideal for organisations that want to scale international hiring quickly. They are particularly useful in the following situations:

Remote-first teams and organisations
Companies testing new markets abroad
Startups expanding internationally

How to choose the right Employer of Record

Choosing between several EOR providers is important, as it influences not only compliance, but also employee experience for new hires and how your company is perceived on the job market.

Here are some important things to keep in mind when deciding on your EOR partner:

Geographic coverage

Make sure that EOR provider can cover the country where you want to expand globally. Read about our EOR coverage here.

Pricing transparency

Check that EOR provider does not have any hidden costs and the pricing is clearly outlined in your MSA.

Compliance expertise

A strong EOR provider should have a team of experienced local HR specialists who understands all in and outs of a national labour law.

In-house vs partner model

Some EOR providers rely on their third-party partners, while others manage employment directly through their own local entities.

Customer support

It is important to find a EOR partner that helps with any questions or concerns in a quick and professional manner. That can be crucial when dealing with employee offboarding or any legal disputes.

Warning signs

Understanding the importance of choosing a right party, your company should be cautious of providers that lack local expertise and cannot give clear answers to your labour law questions. In addition, companies with slow response times can prove to be unreliable in critical situations. Furthermore, providers with complex pricing models with many hidden fees can create a lack of cost transparency and result in unforeseen expenses.

By selecting a provider with strong expertise in local labour law and reliable support from dedicated teams, your company can ensure a smooth international growth. Learn why companies choose ThisWorks as their EOR partner.

How much does an employer of record cost

The vast coverage of services the employer of record provides makes many businesses ask how much an EOR costs.

Pricing models vary greatly on the provider and the country of coverage, but most EORs use one or more of the following structures.

Flat monthly fee per employee.

The EOR provider charges a fixed monthly fee for each employee they have on the payroll from the client.

Percentage of salary

While not being a popular approach, some EOR providers charge a percentage of the employee’s salary, typically ranging between 5%-15%.

Setup fees

Some providers charge onboarding or offboarding fee for each employee.

The fee that the business needs to pay to an EOR provider also depend on the location of a service. Local labour law complexity of some countries can influence the fee. In addition, some countries have specific statutory benefits and payroll administration requirements. Furthermore, employee headcount in the specific location can influence the fee.

EOR vs setting up a legal entity

To establish a new entity the organisations needs to go through legal and tax registration. In addition, accounting support and ongoing compliance costs such as the fees for local labour lawyers can make setting up a legal entity significantly more expensive.

An EOR allows companies to expand globally without these upfront investments.

EOR vs hiring contractors

Some businesses decide to hire international workers as contractors. However, this approach can often lead to a misclassification risk, which can cause legal and tax liabilities.

A professional EOR provider ensures that the new starters are compliantly onboarded under local employment regulations.

EOR FAQs

Is an EOR the same as a PEO?

No. PEO model assumes co-employment and requires the business to already have established local entity, while EOR employs new talents through its own entity only.

Can an EOR hire contractors?

While some EOR providers can support hiring contractors, it is important to remember that main function of EOR is the employment of full-time workers legally in a country. A risk of misclassification between EOR and contractor should be also considered carefully.

Is an employer of record legal?

Yes, when established and structured properly, Employer of Record entities are legal and widely used for international expansion by many companies.

When should you use an EOR?

The most common reason for using EOR include:

Hiring employees located in another countries remotely
Testing new markets before establishing an entity
Expanding internationally

Can you switch from EOR to your own entity?

Yes. Many companies initially hire through an EOR for the ease and speed of expansion and later transition employees to own legal entities upon their establishment. It is important to remember that some countries require specific procedure to be followed in such a scenario.

Get in touch with ThisWorks

Expanding your team globally does not need to be long and administratively complex.

With the use of Employer of Record the businesses can have access to the best talent from around the world while ensuring full compliance with local labour laws.

ThisWorks can support your global expansion with our compliant Employer of Record services.

Contact our team to find our how we can help your international team glow fast and compliantly!

Get All The Insights How To Manage Remote Teams

The transition to remote work needs a reevaluation of management techniques. Traditional in-person monitoring and communication approaches are no longer adequate in the virtual workforce. Instead, managers must adopt new techniques that enable clear communication, trust, and collaboration across distances. This adaptability maintains productivity and produces a more flexible, inclusive, and balanced work environment. As we move ahead in 2024, there will be increased attention on perfecting these procedures. It is necessary to solve remote work problems to create a coherent, productive, and motivated virtual environment. Here we have put together 21 excellent practices for managing remote teams. But first let’s discuss the main challenges that remote teams face.

Major Challenges That Remote Teams Face

Remote teams face a unique set of problems that can impair their efficiency and cohesion. In resolving these difficulties, the role of the worldwide employer of record services becomes vital. They can help manage remote worker legal compliance, ensuring that teams operate smoothly across several jurisdictions. By knowing the advantages of Employer of Record and the liability distinctions between PEO and EOR, organizations may better manage their remote workforce. Moreover, examining how an EOR ensures compliance in different states might provide additional insights into maintaining remote teams.

Communication

One of the biggest difficulties is overcoming communication boundaries. Without the immediacy of face-to-face contact, communications can become challenging, leading to misunderstandings and delays. This challenge is amplified by cultural variations within geographically distributed teams, where diverse communication methods and work ethics might collide, making collaboration more challenging.

Environment

Another key difficulty is the sensation of isolation that distant workers often experience. Removed from the hectic office atmosphere, individuals can feel distanced from their coworkers and the corporate culture. This isolation can lead to diminished motivation and engagement, making it tougher to maintain productivity. Managers must find new ways to keep morale high and ensure that remote employees feel valued and included.

Productivity

Ensuring continuous productivity is a critical concern for remote workers. Without the discipline of a physical office, distractions can be more frequent, and the blurring of work-life boundaries can lead to burnout. Managers need to develop skills that encourage focused work and time management, enabling team members to stay on track and achieve their goals efficiently.

Let’s classify and discuss the best practices to effectively manage remote teams in 2024.

Strengthen The Foundation For Effective Remote Work

Remote work needs a strong base to help teams succeed. Companies must focus on clear communication, goals, rules, and technology. By doing this, remote teams can function well even when they are in other countries.

1. Establishing seamless communication channels

Talking openly and often is the most crucial thing for remote teams. Companies should utilize a mix of applications like Slack or Microsoft Teams for fast chats and project updates. Video chats like Zoom or Google Meet enable participants to see one another, which helps them create relationships. Project management systems like Asana or Trello give teams a central place to track activities and deadlines.

2. Defining clear expectations and goals

Remote teams do their best work when they understand what is expected of them. Companies should define clear goals and explain how each person’s job assists the larger mission. Regular feedback, like check-ins and performance reviews, helps staff stay on track and develop.

3. Crafting a robust remote work policy

A solid remote work policy sets clear standards and protects company information. It should address things like work hours, adaptability for multiple time zones, and cybersecurity. Companies with teams across different states may desire to cooperate with an Employer of Record (EOR). EORs handle payroll, taxes, and benefits, making sure companies obey all the requirements. If you are interested in working with an EOR to manage remote teams contact our experts here.

4. Providing essential tools and technology

Remote workers need the necessary tools to execute their duties well. Companies should provide the tools, software, and hardware particularly needed for the work. Cloud-based applications allow teams to share documents and work together in real-time. Lastly, invest in cybersecurity tools to secure firm data from online dangers.

Cultivating a strong remote culture

A healthy remote culture is crucial for team success, even when employees are physically distant. Fostering a sense of connection, support, and gratitude is vital. Here are techniques to develop a good and productive remote environment.

5. Promoting Work-Life Balance

Achieving a healthy work-life balance is crucial for remote professionals. Encourage boundaries between work and personal time, and support regular breaks. Flexibility is vital – offer schedules that meet time zone variances and individual obligations. This enables improved employee satisfaction and long-term productivity.

6. Encouraging social interaction and team bonding

Build trust and camaraderie with virtual coffee breaks, team-building exercises, and casual catch-ups. These bridge the distance inherent in distant work and foster a sense of belonging. Consider adopting technologies created expressly for remote team involvement to further enhance the experience.

7. Recognizing and rewarding achievements

Celebrate wins both great and little to enhance morale in a distant situation. Public recognition via virtual shout-outs, prizes, or bonuses celebrates individual and team successes. This stimulates employees and expresses appreciation for their contributions.

8. Supporting mental health and well-being

Remote employment can sometimes contribute to isolation and fatigue. Proactively support mental health with options like counseling services (including those given via an EOR’s benefits package) and wellness initiatives. Regular management check-ins give a safe area for employees to discuss concerns, increasing overall team well-being.

Enhancing Collaboration and Productivity

Remote teams require the correct tactics to work together effectively, even when they’re far apart. Here are some tips on how to make communication smooth and keep your team productive.

9. Implement regular check-ins and updates

Consistent communication is crucial! Schedule short daily stand-up meetings or a lengthier weekly check-in. This keeps everyone on track, helps solve problems fast, and enables you to re-prioritize as needed. These sessions guarantee everyone feels connected and part of the team’s growth.

10. Leverage collaborative technology

The appropriate tools are like magic for remote teams. Use services like Slack for fast queries and discussions throughout the day. Project management systems, like Asana or Trello, give everyone a clear perspective of what’s due and who’s working on what. And don’t forget regular video calls (Zoom, Google Meet) to create relationships and minimize miscommunications.

11. Adopting agile methodologies for remote teams

Agile methodologies like Scrum or Kanban are great for remote work. They are built for flexibility, continuous progress updates, and adapting faster to changes. For remote teams, this means staying focused on what’s most important and producing outcomes at a consistent pace.

12. Facilitating autonomous work environments

Empower your team by giving them ownership of their job. When employees feel trusted to manage their time and make decisions, they become more engaged and innovative. Set clear goals and provide support, but then stand back and let your team members choose the best method to achieve success.

Managing Performance and Growth

Remote situations require a specialized approach to help employees attain their potential. Let’s focus on tactics that foster both great performance and continual development:

13. Conducting effective virtual performance reviews

Make virtual reviews meaningful! Ditch the formality and embrace video calls for a more personal connection. Offer concrete, actionable feedback that highlights both accomplishments and areas where they can progress. Regularly revisit goals and progress to help keep team members engaged and on track.

14. Offering continuous learning and development opportunities

Invest in your people! Support their advancement with online courses, webinars, and skills-based workshops. This keeps them interested and up-to-date on the newest industry developments. If you have overseas team members, an Employer of Record (EOR) can speed up access to benefits that may include professional development opportunities.

15. Setting up mentorship and peer support systems

Knowledge sharing and connection are extremely vital for distant workers. Pair seasoned team members with individuals younger to the team for a mentorship experience. This benefits both parties! Additionally, offer chances for peer check-ins to discuss issues and share ideas. This promotes camaraderie and fosters a sense of shared purpose.

16. Tracking and measuring productivity appropriately

Productivity tools might be useful, but trust is crucial. Focus on results achieved rather than how much time someone is logged in. Set clear goals that everyone knows, and utilize performance statistics to inspire productive talks about refining workflows and attaining even better outcomes.

Navigating legal and administrative challenges

Managing a remote worker offers its own set of legal and administrative obstacles. Understanding the rules, simplifying operations across borders, and keeping data secure are all vital. We explain you how to navigate these complexities.

17. Understanding remote work regulations and compliance

Staying on top of remote work legislation is non-negotiable! These restrictions differ widely from country to country, so it’s crucial to receive expert assistance. Do your research to be aware of the rules in each place where you have team members and consider partnering with legal specialists for ongoing updates as laws alter such as an EOR. This assures remote worker legal compliance and helps your organization avoid costly blunders.

18. Managing cross-border employment with EOR services

Are you thinking of recruiting internationally? A worldwide Employer of Record (EOR) can streamline the procedure. EORs tackle the HR and legal issues of managing staff in foreign countries. For many organizations, this is an easier option to expand their personnel across borders rather than setting up their legal entities in each location. EORs verify you’re obeying local labor rules and ease the recruiting procedure.

19. Streamlining payroll and benefits for global teams

Paying a worldwide workforce gets complicated fast! You’ll need systems to handle several currencies and stay in compliance with tax rules in different areas. Payroll software specifically developed for worldwide teams is often the best method to ensure your employees get paid on time and that you’re meeting all your tax obligations.

20. Protecting data security and privacy

Remote work makes data security even more crucial. Make efforts to keep all corporate and employee information safe, including using secure communication technologies, encrypting sensitive data, and routinely training your team on cybersecurity best practices. Protecting your data is important more than just avoiding fines – it’s about retaining trust with your staff and clients.

21. Developing a crisis management plan for remote operations

A well-defined crisis management plan is necessary for remote operations. This strategy should identify procedures to take in numerous scenarios, from cybersecurity attacks to sudden changes in work regulations. Regularly assessing and updating the crisis plan ensures the team is always prepared to respond fast and efficiently, minimizing disruptions to work.

Frequently Asked Questions

1. How does an Employer of Record (EOR) enhance remote team management?

An Employer of Record can significantly streamline remote team management by handling legal compliance across different jurisdictions. This is crucial for maintaining smooth operations when teams are distributed globally, ensuring adherence to local employment laws.

2. What are the key benefits of using an EOR for managing international employees?

Employers can leverage EORs to manage payroll, taxes, and employee benefits efficiently. This helps businesses ensure compliance with regional regulations without the need to establish local entities, thereby reducing legal risks and administrative burdens.

3. How does an EOR ensure compliance with employment laws for remote workers?

EORs stay abreast of changes in employment legislation in each state or country, helping companies navigate the complexities of hiring and managing remote teams legally. They manage all aspects of HR compliance, from payroll to benefit distribution and labor law adherence.

4. Can an EOR assist with the development of a remote work policy?

Yes, EORs can guide on crafting remote work policies that are compliant with local laws. This includes defining work hours, ensuring data security, and setting standards for employee conduct and performance.

5. How do EOR services facilitate better performance management in remote settings?

EORs can help implement effective performance management systems by providing tools and support for virtual performance reviews. This ensures that feedback and goal-setting are aligned with the company’s objectives while being sensitive to the nuances of remote work.

6. What strategies can be employed to foster a strong remote work culture?

Building a positive remote culture involves promoting work-life balance, encouraging social interaction, and supporting mental health. EORs can aid in these areas by offering access to wellness programs and facilitating virtual team-building activities.