Would you like to discover Umbrella Company Services in Turkey? This is a new uncommon employment status abroad, and appears as a simple and effective springboard to test its economic activity in a new market without risk, before undertaking missions of implantation or development of more activities. It also serves to test the relevance of the market and the feasibility and success of an idea or product. These services can be divided into two solutions; Professional Employer Organizations (PEO) and Employer of Record (EOR) services.
PEO – PROFESSIONAL EMPLOYER ORGANIZATION:
This is basically a co-employment relationship with the customer as a third-party organization for employment. The customer is the worksite employer of the employee whereas the service provider – PEO – is responsible for certain HR-related issues, especially in terms of payroll, administrating benefits, being compliant with labor laws, withholding tax, and compensation payments of employees.
This option is useful for small and medium-sized companies mostly. Companies prefer this service to test a market before entering there with a legal structure.
EOR – EMPLOYER OF RECORD:
The employer of record service is also making it possible for foreign companies to hire employees in another country although they don’t have a legal entity. The difference between PEO and EOR is legal responsibilities. EOR is legally responsible for the employee on behalf of the customer company. Just like in PEO, EOR services include payroll, employment contracts, benefits, withholding tax, etc. This is a way of simplifying employment in a foreign country so that the customer’s company can solely focus on their business.
The Umbrella Company Services in Turkey involve three actors:
- The client company uses a workforce that has the capacity to carry out missions on Turkish territory and which signs a contract of performance with the company of Umbrella Services.
- The payroll company, here it’s us, ERAI Turkey, which intervenes by having the employee sign an employment contract and by guaranteeing the client company a good performance of their activities on the spot.
- The employee who has signed a contract with the payroll company, and who becomes his employer (through an employment contract).
The benefits of the Umbrella services in Turkey are multiple:
To begin with, Turkey is a country of laws and regulations and sometimes these laws may seem difficult for foreign companies to understand and follow. That’s why we recommend companies who would like to develop their business in Turkey, try our umbrella company services to observe the Turkish market and understand their potential in their own field.
- Recruit more effectively by adapting the workforce according to the needs of the company
- Outsourcing non-core tasks to the core of the market …
- Respond to a temporary need or a peak of activity
- Hire qualified personnel (sales expert, engineer, area manager …)
- Security in the management of the employee
- The takeover of the administrative tasks by the payroll company (expenses, car rental …) which allows the client company to concentrate on its core business.
- Small financial investment and minimized risks
- To benefit from a single interlocutor (here the payroll company ERAI Turkey) for your activities in Turkey
- The customer does not have to pay any corporate expenses since they don’t have a legal entity but they benefit from having an employee in the field.
- The only cost the customer pays is the employment costs and service fee of the service provider.
Every year, ERAI Turkey hosts around 30 employees in its structure. They are recruited by ERAI Turkey in Europe or locally and then placed on the premises of ERAI Turkey. They are then physically and administratively supported and trained in the Turkish market and the client company’s sector if needed. It is important to choose the most trustworthy service provider since there are legal issues that need to be handled by the employer for the employee.
When all the aspects are taken into account in terms of responsibilities in the eyes of legal authorities the customer should evaluate its options carefully to choose the most suitable and trustable service provider for their employees. It’s essential to evaluate each service provider with their pros and cons before making a final decision.
If you would like more information about Umbrella Company Services in Turkey, please do not hesitate to contact us.
For the French version of this article, click here.