Employer of record service in Vietnam and Southeast Asia.

Expanding into Vietnam and Southeast Asia is a key strategy for many international businesses looking to tap into new, promising markets. However, the process comes with its own set of challenges, including the complexities of labor laws, taxes, the need to establish a legal entity, and compliance with local regulations.

One of the most effective solutions to overcome these barriers is to use an Employer of Record (EOR) service. With employer of record service, businesses can hire local staff, manage payroll, and ensure compliance — without setting up a legal entity. This article is employer of record explained, where we analyze the benefits, considerations, and industries that can benefit from EOR services in Vietnam and Southeast Asia.

1. What is an Employer of Record (EOR)?

What is an employer of record? An Employer of Record (EOR) is a third party responsible for recruiting legal employees on behalf of a foreign business. More than just payroll processing, an EOR also acts as a strategic partner, ensuring legal compliance, optimizing HR processes, and providing related business services. Using EOR services in Vietnam and Southeast Asia, businesses can:

  • Recruit quickly without establishing a legal entity.
  • Ensure compliance with local labor regulations.

How employer of record services work?

2. Why use EOR services in Vietnam and Southeast Asia?

2.1. Accelerate market entry & optimize costs

Establishing a legal entity takes time and costs a lot. Employer of record role helps recruit immediately at a reasonable cost, shortening the time to enter the market.

2.2. Ensure legal compliance & minimize risks

Each country has different labor and tax laws. Employer of record meaning:

  • Legal labor contracts.
  • Tax and insurance management.
  • Dispute resolution, dismissal policies.

2.3. Optimize payroll & HR management

  • Payroll & benefits.
  • Personal income tax.
  • Compliance reporting.
  • HR onboarding & offboarding.

2.4. Access to quality talent

Recruit good talent at reasonable costs without violating the law.

3. Compare EOR and Legal entity establishment

When comparing the use of Employer of Record (EOR) service with the establishment of a legal entity in a Vietnam and Southeast Asian country, it can be seen that EOR offers many advantages in terms of time, cost and flexibility. Specifically, the implementation time when using EOR is almost immediate, while the establishment of a legal entity usually takes from 3 to 6 months or longer. In terms of legal compliance, EOR helps businesses minimize risks when all responsibilities related to labor laws, taxes and welfare are taken care of by EOR, while if establishing a legal entity by itself, the business will have to manage all these factors and face higher risks.

The start-up cost with EOR is also significantly lower than the cost of building a new legal entity. In addition, payroll and human resource management is performed by EOR on behalf of the business, helping to save internal resources. Finally, EOR offers great flexibility in market strategy, allowing businesses to easily expand or withdraw when needed, while establishing a legal entity comes with limitations due to legal and financial constraints.

4. Industries that benefit from EOR services

  • Technology & IT: Programmers, software engineers working remotely.
  • Manufacturing & Supply Chain: Large manufacturing operations in the region.
  • Consulting & Corporate Services – Consulting firms can quickly set up teams without a legal entity.
  • Retail & E-commerce – Support business expansion, manage local teams.

S4B Vietnam – Trusted EOR Partner in Vietnam

5. EOR services in Vietnam – Attractive destination

Vietnam is one of the most potential markets in Vietnam and Southeast Asia thanks to strong economic growth, high-quality human resources and preferential tax policies. How does an employer of record work in Vietnam?

  • Understanding local laws – Ensuring compliance with labor and tax regulations.
  • Abundant workforce – Young, highly qualified human resources.
  • Cost optimization – Labor costs are much lower than in the West.
  • HR & Payroll Support – Comprehensive management of HR services.

Important legal regulations

  • Probationary period: Maximum 60 days.
  • Social & health insurance: Enterprises must fully pay according to regulations.
  • Resignation policy: There are clear regulations on notice and reasons for contract termination.
  • Number of days off: 12 days of annual leave and 11 days of official holidays.

6. How to choose the right EOR provider?

Enterprises should consider the following criteria when choosing EOR services in Vietnam and Southeast Asia:

  • Understanding of labor laws & taxes.
  • Support for risk management & compliance.
  • Effective payroll & HR management system.
  • Quality of service & customer support.
  • License to operate – In Vietnam, EOR requires a Labor Supply License.

7. How employer of record services work?

Expanding into Vietnam and Southeast Asia is promising but also comes with many legal and administrative challenges. With EOR services, businesses can recruit quickly, ensure compliance and optimize costs, helping to accelerate the international expansion process.

S4B Vietnam – Trusted EOR Partner in Vietnam
S4B Vietnam (S4B) provides comprehensive EOR services, helping businesses manage human resources, comply with laws and expand markets without establishing a legal entity.

Why choose S4B Vietnam?

  • Deep expertise in local markets.
  • Optimized HR & payroll solutions.
  • Accelerate market penetration.
  • Ensure legal & tax compliance.

With many years of experience in the field of business services and human resource management, S4B Vietnam is a trusted partner for businesses looking to expand into Vietnam and Southeast Asia.

S4B Vietnam

  • Address: Unit 701B – 701C, Tower A, Handi Resco 521 Kim Ma Street, Ba Dinh District, Hanoi, Vietnam.
  • Tel: + 84 24 3974 4181
  • Email: service@s4b.com.vn

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