Glossary
Employer of Record (EOR)
A third party that formally employs a worker on a client's behalf, handling payroll, statutory compliance and local employment law so the client needs no local entity.
An EOR takes on the legal employer role — payroll, tax, statutory benefits, labour-law compliance — for a worker who reports to and works for the client company. This lets the client hire in India without setting up its own entity.
For India specifically, an EOR must apply the full deemed-wages, gratuity and PF machinery on the client’s behalf. The EOR is the entity of legal record for the employment relationship.
Why it matters now: an EOR is only as good as its Code compliance. Clients should ask explicitly how their EOR handles the deemed-wages calculation, not assume it is automatic.