Emmanuel BisiThe United Kingdom, boasting one of the world's most powerful economies, stands as a major attraction for international enterprises. In 2023, the UK recorded a GDP of $3.1 trillion, ranking as the sixth-largest economy globally. London, as a global financial hub, hosts thousands of multinationals and burgeoning businesses drawn by a dynamic business environment and world-class infrastructure. Faced with such allure, companies seek flexible solutions to establish and expand without the constraints of traditional hiring. EOR services offer an innovative solution, enabling companies to access diversified and highly skilled talents while optimizing their costs and regulatory compliance. This model perfectly addresses the needs of companies navigating the complex and ever-evolving British market, offering a secure and effective alternative for their professional expansion.
Since 2010, Expandys has been established in the United Kingdom, providing your company with a legal entity for hiring staff under a payroll umbrella. With our local team, we can also support you on various other topics related to your business. Unlike common practices in the industry, we directly manage the hiring process without outsourcing, ensuring full compliance.
What are EOR Services?
EOR (Employer of Record) services represent a tripartite contractual relationship between the EOR company, the independent professional (contractor), and the client company where the contractor will undertake their assignment. Three types of contracts are thus concluded:
- An employment contract, between the independent professional and the EOR company.
- An EOR agreement, between the independent professional and the client company for which they will work (including the collective agreement, pension fund, etc.).
- A service contract, between the EOR company and the client company, which defines the terms of the contractor's assignment execution.
The EOR company manages the administrative, financial, and legal aspects related to this activity.
Ultimately, EOR services provide a flexible solution for any company wishing to outsource a service. Highly adaptable, the contracted professional is immediately operational and brings a valuable external perspective during their assignments.
UK Employment Regulation:
The regulatory framework for employment in the United Kingdom is one of the most robust and protective globally, ensuring fair conditions for both employers and employees. Our EOR Services assist you in navigating this complexity, providing tailored and compliant solutions to local regulations. Here's an overview of the main regulations and practices in effect:
- Employment contracts: Employment contracts must include all essential information and comply with local regulations, particularly regarding social benefits and payment in British pounds (GBP).
- Working time: The legal maximum working time is 48 hours per week, flexibly distributed. Workers can choose not to adhere to this limit without risk of sanction. It's possible to work more than 48 hours in some weeks, provided that working time is reduced in the following weeks. This average of 48 hours is calculated over a 17-week period, offering flexibility throughout, provided the limit is respected.
- National Minimum Wage: Workers and employees are entitled to be paid at least the national minimum wage, set by the government and revised annually by the Low Pay Commission (which includes unions and employers).
Rates differ for young people aged 16 to 17, those aged 18 to 20, those aged 21 to 24, individuals aged 25 and over, as well as for certain apprentices.
- Public holidays and annual leave: Employees are entitled to a legal minimum of 4 weeks of paid leave per year, plus 8 days of public holidays (national holidays). In some workplaces, the employer allows all staff to take time off on public holidays, but in others, employees must take leave in place of public holidays. Check your employment contract, employee handbook, or consult your union representative to know your entitlements.
- Sick Leave: In case of absence, unless otherwise provided in a more favorable contract, the employer does not pay the employee for the first three days of absence. From the fourth day, the employer begins to pay sickness benefits. The employer is required to pay these benefits for a period of 28 weeks. For the first 8 days of absence, the employee is not required to provide a medical certificate. After this period, the employer may request a medical certificate, and the employee is required to provide it under penalty of dismissal.
- Taxes and Insurance: Employers cover National Insurance contributions and payroll taxes. The corporate tax rate is currently 19%.
Benefits of EOR Services for Companies in the United Kingdom:
Companies opting for EOR services in the UK can benefit from numerous advantages:
- Simplicity and speed of implementation: Avoids the long and costly process of creating a legal entity.
- Workforce flexibility: Adjusts the size of the team according to the fluctuating needs of the business.
- Legal and administrative security: Maintains independence while eliminating administrative constraints.
- Insurance protection: Coverage by Professional Civil Liability insurance for contracted employees.
- Economic and social benefits: Employees receive regular salaries and social benefits similar to those of permanent employees.
- Reduction of legal liabilities: Sharing of responsibilities between the EOR company and the client company, minimizing legal risks in a complex environment.
How Does an EOR Company Operate in the United Kingdom?
With our established presence since 2007 in the United Kingdom, we have in-depth expertise in the British market, ensuring tailored solutions and successful integration for our clients. Through our freelancing services, we can assist you in exploring the UK market, allowing you to quickly test it without the complexities associated with setting up a local legal entity.
- Immigration and visa assistance: Simplifies obtaining the necessary visas for international professionals.
- Recruitment: Assists in hiring local talents suited to the specific needs of the company.
- Drafting of employment contracts: Compliance with local regulations, drafting contracts in British pounds.
- Human resources and payroll management: Adapts to British standards, including specificities such as the minimum wage, which can vary by sector.
- Administration and social benefits: Manages benefits such as health coverage, pensions, and other legal advantages.
- Tax management: Ensures tax compliance and payment of due taxes.
- Billing and accounting: Complete management from billing to accounting.
- Contractual relationship management: From onboarding to the conclusion or renewal of contracts
Are you looking to engage an employee through EOR Services in the UK?
