# What Is an Employer of Record (EOR)?

EOR stands for Employer of Record. It is a company that legally employs your team member on its own local entity, so you can hire someone in a country where your business is not registered. The EOR signs the employment contract, runs payroll, withholds income tax, registers the employee for statutory social security, provides mandated benefits, and carries the employment liability. You direct the work.

## What the EOR is responsible for
- The employment contract: drafted and signed by the EOR on its entity, under local law.
- Payroll, tax and benefits: salary payment, income-tax withholding, statutory social-security registration and contributions, mandated benefits.
- Employment liability: termination process, notice, severance, and any labour-authority dispute.

## What stays with you
- Defining the role, the salary and the terms offered.
- Directing the person's day-to-day work.
- A single invoice covering salary plus the EOR fee.

## When a company needs one
- Hiring where you have no legal entity and do not want to incorporate first.
- Testing a market with one or two hires before committing to a subsidiary.
- Converting a long-term contractor who is functionally an employee.
- Building a small distributed team without an entity in each country.

## EOR vs PEO
A PEO co-employs alongside you and requires you to already have a local entity. An EOR is the sole legal employer and uses its own. The deciding question is whether you are incorporated where you are hiring. See https://raintechnovation.com/compare/employer-of-record-vs-peo

## Indonesia
RainTech operates its own Indonesian entity, so Indonesian hires are employed directly rather than passed to a local partner: contract, BPJS Kesehatan and BPJS Ketenagakerjaan registration, PPh 21 withholding, the statutory religious-holiday allowance, and termination under Indonesian employment law. USD 300 per employee per month, all-inclusive. Onboarding 24-48 hours from offer acceptance. 100+ other countries via a vetted global EOR partner network.