Doing Business in Indonesia – EoR/PEO Service Explained

Doing Business in Indonesia – EoR/PEO Service Explained

In this article, we take an in-depth look at an Employer of Records and a PEO service, in an effort to help entrepreneurs gain a deeper understanding of both EoR and PEO.

What is EoR?

An Employment of Records is a service that allows a business to employ locals without setting up a business entity; the EoR service can handle all your HR needs without the need to set up a corporate structure, which is an invaluable service. The EoR provider actually becomes the employer of the new employee, managing taxation, payroll and other aspects of employment, which keeps things legal and above board until you register your business entity with the Indonesian government.

What is PEO?

A professional employment organisation, or PEO, handles outsourced HR needs for their clients; if you would like to contact PEO companies, Google can assist you in locating an established PEO service that can act on your behalf until you set up a business in Indonesia. PEO usually offers 3 main services, which are as follows:

  1. Contractor and freelance management services.
  2. Employer of Record (EoR) services.
  3. Payroll outsourcing services.

You might be in the process of setting up a business entity in Indonesia, and rather than waiting for the registration to be completed, you can hire employees using a PEO service from a trusted 3rd party.

Rapid entry

One of the major benefits of using a PEO is that you can hire employees without having set up a business entity in Indonesia. This can happen within 48 hours, which is very quick indeed while using a PEO service is very affordable. Another important thing to note is that the PEO service provider is fully liable for employees, which takes the pressure off you. Click here for tips on how to become a business coach.

Seamless onboarding system

The great thing about PEO and EoR is that your team can get onboard effortlessly with the following 4 steps:

  1. Review the PEO proposal.
  2. Review onboarding documents.
  3. Pay the initial invoice.
  4. Draft the employment agreement and start work.

It really is that simple to use a PEO service that enables new employees to start work before the company entity is created. This empowers you to get started on your new business in Indonesia prior to setting up the company.

Company registration 

Once you are ready, the same company that provided PEO or EoR service can facilitate your company registration. Their specialist would ask for certain documentation and within 4-6 weeks, your new company is set up and ready to go. There are many services offered that you will probably require when you are ready to set up business in Indonesia, such as secretarial services, bookkeeping and accountancy.

If you are planning to set up a company in Indonesia, we recommend searching online for an organisation that offers PEO and EoR services, as they have the know-how to get your organisation up and running.

Read Also: Maximizing Productivity: The Role of Business Management Administration