In managing your contingent workforce, picture your business navigating a sea of procurement complexities and compliance challenges. Now, imagine a partner that doesn’t just meet these challenges but also becomes your comprehensive support system. That’s an Agent of Record – AOR – your strategic ally in turning workforce hurdles into competitive advantages.
This blog unpacks the significance of AOR services, cuts through the jargon, and distinguishes them from the Employer of Record (EOR).
What is an Agent of Record (or Agency of Record)?
An AOR is your go-to partner when it comes to navigating the complex realm of contingent workforce procurement and compliance. Picture this: a skilled team of outsourced professionals streamlining your procurement processes, ensuring regulatory compliance, and optimizing costs. That’s the magic an AOR brings to the table.
AORs act as a bridge between your organization and the labyrinth of regulations, offering safety and a strategic advantage in the competitive landscape. AORs:
Mitigate risk: AORs ensure that your contingent workers are compliant; that is, they meet federal and state / regional regulations for engaging as independent contractors — including ensuring that they carry appropriate insurances. AORs therefore minimize a wide variety of risk factors, including costly reclassification risk and an array of business liabilities.
Streamline administration: AORs are not employers, as the workers they administer are independent contractors and not employees. But they handle similar administrative tasks for ICs, such as onboarding, timesheet admin, payments, end-of-year tax statements, day-to-day support, offboarding, and more.
Vendor contract management: Executing and managing contracts with each independent contractor you engage can be tiresome, time-consuming, and error-prone. AORs handle this burden for you, freeing your staff up to focus on more pressing concerns.
EOR and AOR: The Key Differences
Let’s clear the air on another commonly used term – Employer of Record (EOR). While AOR and EOR might sound similar and share several similarities, they serve some significantly different purposes in contingent workforce management.
While AORs focus primarily on procurement and management of independent contractors / vendors, EORs take a broader stance. They assume the responsibility of being the legal employer for members of your contingent workforce. This includes managing payroll, benefits, and compliance with employment laws – a comprehensive solution for businesses looking for end-to-end workforce management.
So in general, whether you use an AOR vs. an EOR depends on the IC compliance status of your contingent workers. Those who qualify as ICs need an AOR for compliance, admin, and payment, while non qualified workers (who must engage as employees to avoid compliance risks) need an EOR for employment admin, benefits, tax-withheld payroll, and more.
Prosperix AOR Services
At Prosperix, we understand the critical importance of choosing the right compliance and engagement solution for your contingent workforce. That’s why our AOR (Agent of Record) services stand out.
When you partner with us, you’re not just getting a service – you’re gaining a comprehensive support system that ensures compliance, peace of mind, and a great experience for your valued workers. Our advanced technology platform swiftly evaluates independent contractor (IC) compliance for every contingent worker, taking into account the nuances of Federal and state / territorial laws.
With Prosperix’s AOR services, we prioritize the safety and efficiency of your engagements. Our commitment to staying abreast of ever-changing labor laws and tax regulations is reflected in our frequently updated internal knowledge base. That’s why our services not only streamline your administrative processes but also protect you from potential legal pitfalls. From contract administration to HR support, our platform covers it all, enabling your team to focus on core business needs.
We also take the guesswork out of navigating complex international regulations, offering a robust solution that extends beyond U.S. borders to facilitate global hiring effortlessly. By choosing Prosperix’s AOR services, we empower your company to tap into international talent markets without the complexities of establishing a physical presence in each country.
We take pride in offering more than just a service – we provide a partnership that adapts to your evolving workforce needs, ensuring great outcomes and happy workers at every step of the way.
