If you hire through an EOR, who actually approves a raise or a firing?

Summary

You make the call; the EOR makes it legal. Deciding that someone gets a raise, a bonus, or a termination is your business decision, but only the legal employer can change the employment terms, so Remote, for one, says every change "must be reviewed and issued by Remote." Terminations run the same way, with the EOR reviewing the case against local law before anyone tells the employee. Anything that has to show up on a payslip also has a monthly cutoff, and missing it pushes the item to the next month.

A raise, from your side and from theirs

Say you want to move an engineer in the Netherlands to a senior title with a higher salary. Agreeing it with her is not enough. You submit the change, Remote reviews it, and Remote issues it as an amendment to her employment contract. Remote's help center says salary and title changes submitted by the 5th of the month make that month's payroll.

The same page covers performance problems. It tells clients not to start a performance improvement plan without Remote's approval, and not to decide the type of a termination on their own. You still run the day-to-day work and write the review. The steps that carry legal weight go through the employer.

The monthly cutoff

Expenses, commissions and bonuses, overtime, time off, and new hires all have to be approved before Remote's payroll cutoff, which is the 11th of each month at 11:59 p.m. UTC in most countries and the 16th in 23 others, including Germany, the Netherlands, and Australia. Approve an expense on the 12th in a standard-cutoff country and it is paid with the following month's salary. Remote says that in most cases it cannot run those items as off-cycle payments.

Deel's cutoff for bonuses and other adjustments is 11:59 p.m. Pacific time on the 20th. The country-by-country dates, and when payroll money has to reach the provider, are in SeatBill's piece on EOR payroll funding and cutoffs.

Letting someone go

Remote's instruction is blunt: submit a termination request before you speak to the employee. Remote reviews it against the employment agreement, local labor law, and any collective bargaining agreement, and says its advice on next steps can take up to five business days. If outside counsel is needed, you are told about the extra charge before it is incurred. In some countries Remote has to lead the first conversation; in others it is a joint call. Remote runs final pay and the offboarding.

Deel puts it the same way: "As the employer of record, Deel is responsible for terminating the EOR employee." Its terms require 30 days' notice to Deel when you start a termination, and Deel may move the end date you asked for after checking local law. The decision to part ways is yours. The date and the manner are set by the country's rules and carried out by the employer on the contract.

Sources

• https://support.remote.com/hc/en-us/articles/33686365924749-How-to-work-with-Remote-effectively-when-hiring-through-Employer-of-Record-EOR
• https://support.remote.com/hc/en-us/articles/4410446893965-What-is-the-payroll-cutoff
• https://support.remote.com/hc/en-us/articles/4411585179661-How-can-I-terminate-an-employee
• https://support.remote.com/hc/en-us/articles/6739791078285-How-to-submit-a-termination-request
• https://help.letsdeel.com/hc/en-gb/articles/4419648055185-What-Are-the-Payroll-Cut-off-Dates-and-Times
• https://help.letsdeel.com/hc/en-gb/articles/17671152016017-Frequently-Asked-Questions-About-EOR-Invoices
• https://help.letsdeel.com/hc/en-gb/articles/5305712783889-How-to-Begin-the-Termination-Process-and-Offboard-an-EOR-Employee

Related on this site

• What does an employer of record actually take off your hands?
• When does an EOR need the payroll money, and what happens to a bonus approved after the cutoff?
• Beyond the monthly fee, what do you pay when an EOR employee leaves?
• Does an employer of record take care of all the compliance when you hire abroad?
• Whose name is on the employment contract when you hire through an EOR?