After a few years of closely studying global EOR (employer of record) solution providers, in early 2020, I launched the first global EOR research program by an analyst firm, authoring the market's first market analysis, sizing, and vendor rankings of the global employer of record services marketplace.
It was still very early for this emerging service model, and the industry itself was and remains fragmented and sometimes confusing.
I had a good understanding of the solution and its value. Still, the research opened my eyes to the strategic impact that global EOR could have on organizations of every size and maturity.
The ROI wasn't in EOR's ability to 'pay anyone anywhere' in the world. The ROI was in the agility it created for companies lacking business nexus in target countries, or in the knowledge, time, and acumen required to succeed.
This was far more than a global payroll alternative – it was an employment model that could enable organizations with the one capability every modern business must master – organizational agility.
Global EOR is rooted in localized compliance expertise, infrastructure, and processes, but, more importantly, it is a source of speed and agility. It's an 'org agility lever' that enables a business to execute on strategic plans compliantly, quickly, and with confidence through workforce agility.
I soon dubbed the service ‘HR outsourcing's best kept secret’ in an article.
Fast forward to 2025, and unfortunately, this remains true.
The problem is that global EOR is still primarily seen (and often poorly marketed) as a global payroll services alternative rather than the strategic growth engine it is maturing into.
Global EOR is increasingly showing up in the flow of business and HR strategy, integrated and embedded in HCM platforms to enable fluid workforce models, laying the groundwork for its next phase of maturation as a strategic growth engine.
Global EOR of the past
To understand where global EOR is heading, it's helpful to know how we got here.
The global employer-of-record model is rooted in the early days of international PEOs (Professional Employer Organizations). Local specialists enabled companies to expand internationally faster, without the cost and time commitment required to establish a permanent business nexus in a country.
Early EOR providers, often born from payroll or staffing firms, served as the legal employer of record for workers abroad and subsequently managed payroll, tax compliance, and other administrative matters. At the same time, customers retained day-to-day engagement and control over their workers.
The model's success was rooted in its local specialization, but it was highly manual and compliance-driven, narrowly focused on risk mitigation and accurate local payroll execution rather than scalability or technology. Often, these local providers were, and essentially still are, underpinning aggregated services to an increasing number of global EOR firms.
In the 2010's cloud innovation enabled the rise of the technology-enabled global EOR provider and the proliferation of local entities and capabilities at scale, to support a true global employment platform offering. A single vendor, with a technology-driven global employment operating model orchestrated across all countries, was increasingly possible, preferred, and essential for workforce agility.
Global EOR 'now and next'
The technology-driven rise in globalization, an accelerating talent and skills crunch, and a pivot-or-perish business environment riddled with a growing compliance minefield have made global EOR an essential business partner in enabling and derisking strategic plans.
The risk exposure to modern organizations operating globally has intensified significantly in the recent decade. Geopolitical, regulatory, supply chain, talent, ESG, and cybersecurity risks are all localized, layered, and compounded as the company scales globally.
Advancing strategic growth opportunities in new locations, accessing a strategic talent pool beyond borders, or acquisitions, all require the ability to execute on the initiative in a timely, compliant, and confident manner.
Further, with talent becoming scarce, fluid, and in a constant state of disruption due to AI, employers are facing 85 million unfilled jobs globally by 20301, potentially resulting in $8.5 trillion in lost revenue, all while navigating a regulatory landscape complicated by AI governance, data sovereignty, and climate-linked labor laws.
The EOR solution will need to support employers in the shift from 'talent as a fixed asset' to 'talent as a fluid network' with a decentralized mesh of skills and talent sourced, engaged, and employed on demand from many channels and locations. Global EOR will not only further democratize access to borderless talent but also unify talent, compliance, and pay data to provide holistic workforce views and enable fluid workforce models and strategies.
1Korn Ferry: The $8.5 Trillion Talent Shortage: https://www.kornferry.com/insights/this-week-in-leadership/talent-crunch-future-of-work
Intelligent, adaptive compliance platform
The global EOR model and industry are maturing and inching the solution toward an intelligent, adaptive platform. Leveraging AI to anticipate talent and compliance needs rather than reacting to them. It will soon orchestrate hyper-personalized talent ecosystems, embedding predictive analytics, ethical AI, and sustainability metrics to align human potential with strategic priorities and enable organizational agility.
Compliance layer
As regulations continue to fragment, EOR will need to leverage its insights and expertise to orbit the business as a compliance layer. Leveraging AI for real-time updates to track and predict regulatory changes and providing proactive compliance against emerging legislation, like evolving AI and data laws. AI will also model compliance scenarios for key talent and organizational decisions, enabling predictive and prescriptive insights and guidance against real-world scenarios. Pay and money movement will remain at the core of global EOR's compliance oversight, which it will orchestrate through continuous earnings, automated processing and tax management, and instant settlement across currencies.
Data fabric
The global EOR platform will become a data fabric for talent ecosystems, weaving together HR, compliance, payroll, and performance data from global sources into a cohesive, actionable layer to advise, inform, and derisk.
As a compliance-driven data fabric, EOR won't just handle administrative tasks; it will enable hyper-connected, AI-orchestrated talent management that anticipates needs, mitigates risks, and unlocks value from hidden HR insights scattered across systems. Further, its data and advice will assist the business in predicting and derisking talent opportunities, to support HR in achieving workforce alignment — the right skill and talent, doing the right things, at the right time, regardless of where they're located or sourced.
Global EOR's data and expertise will also become increasingly essential for business decisions involving new locations of operation or the execution of mergers, acquisitions, or divestitures. With the help of AI, global EOR data will enable the business to simulate and model outcomes for predictive insights to support strategic decisions.
About the author
Pete A. Tiliakos
Principal Analyst, Strategic Advisor, & Chief Payroll Champion at Payroll Influences LLC
Pete leverages unique market expertise from over 30 years in HR and payroll technology, services, and transformation. Pete is globally recognized for his extensive knowledge, coverage, research, and strategic advisory of leading and emerging solution providers across the payroll, employer of record services, payments, and HCM technology marketplaces. Both practitioners and providers widely leverage his research and perspectives as he is a regular contributor to industry associations, podcasts, publications, and events and the co-host of the HR and Payroll 2.0 podcast, and host of The Source podcast by DailyPay.
