For US-based recruitment firms, expansion often involves multi-state hiring that allows them to tap into new talent pools. However, tapping into those pools comes with regulatory, administrative, and logistical challenges. By partnering with an Employer of Record (EOR), recruitment firms can expand their search radius without the complications that multi-state hiring typically involves. Here are five compelling reasons why recruitment firms should work with an EOR to maximize their reach across the U.S.
Access to a nationwide talent pool without establishing multiple legal entities
Similar to entering the US market from abroad, hiring out of state means dealing with each state’s labor laws, tax requirements, and HR regulations. For recruitment firms without an existing presence in these states, setting up new legal entities can be costly and time-consuming. An EOR already has the infrastructure in place to operate in all 50 states, enabling recruitment firms to quickly access talent anywhere in the country without needing to establish a legal footprint.
This means that, recruitment firms can source candidates across the U.S. on behalf of their clients, expanding the talent pool significantly. This flexibility allows firms to meet client demands for top-tier talent regardless of location while bypassing the operational overhead of state-by-state legal compliance.
Simplified compliance with state-specific labor laws
While everyone in the U.S. must comply with federal law, each state also has unique employment laws regarding overtime, minimum wage, paid leave, and more. This means that what applies in the state where your client is based may not apply in the state where your candidates are located, creating additional compliance risks. Trying to keep up with these differences while recruiting nationwide can be overwhelming, especially as laws are constantly evolving. EORs specialize in state-specific compliance, ensuring all workers are hired, managed, and paid in accordance with local regulations.
This is especially beneficial for firms placing temporary or contract workers, where regulations can vary even more dramatically.
Streamlined payroll and tax administration across state lines
Payroll and tax management can become incredibly complex in a multi-state hiring scenario. Each state has different income tax rules, withholdings, unemployment insurance rates, and reporting requirements. EORs can offload this administrative burden by handling payroll and taxes in each state according to specific regulations.
Your EOR will ensure that employees receive accurate, timely payments and that the correct taxes are withheld and remitted for each jurisdiction.
Enhanced candidate experience through standardized benefits and HR support
Offering competitive benefits packages that meet state-specific requirements can be challenging for recruitment firms operating across states. EORs take on this responsibility by providing state-compliant benefits, such as health insurance, retirement plans, and paid leave. They also handle benefits administration, ensuring a consistent experience for employees regardless of where they’re located.
A candidate is more likely to accept a position when they know they’ll receive comprehensive benefits and dedicated HR support. Recruitment firms can often advise clients on what makes a competitive compensation package, so it’s crucial for them to understand the standards in each state.
Greater flexibility and speed in scaling recruitment nationwide
Working with an EOR allows recruitment firms to scale their operations flexibly, without the restrictions of geographical limitations. Whether a client needs placements in one state or across several, an EOR makes it easy to recruit, onboard, and manage employees quickly, which is essential in a competitive job market.
This flexibility also benefits recruitment firms during surges in hiring demand or in cases where clients require rapid placements across multiple states. The EOR takes care of the back-end logistics, freeing up the recruitment team to focus on sourcing and placing top candidates. By enhancing speed and agility, recruitment firms can strengthen their value proposition to clients who are looking for scalable recruitment solutions across the country.
If you’re ready to partner up with an EOR, contact our team today.