A Singapore-based global tech company aimed to expand in Southeast Asia, particularly in Vietnam. They needed a strong local team for software development, customer support, and project management. However, the company faced obstacles related to Vietnamese labor laws, recruitment strategies, and navigating the competitive job market.

Goals

1. Efficiently hire skilled tech professionals in Vietnam.
2. Ensure compliance with Vietnamese labor laws.
3. Manage recruitment costs effectively.

Challenges Faced

1. Local Regulations: The company was unfamiliar with Vietnam’s labor laws, such as mandatory social insurance, employment contracts, and tax regulations.
2. Competitive Job Market: Vietnam’s tech industry is rapidly growing, making it difficult to find skilled software developers, engineers, and IT professionals.
3. Cultural and Language Barriers: Communication and understanding workplace culture posed challenges for expatriate management teams.
4. Cost Management: Establishing a legal entity in Vietnam can be expensive, both in terms of setup and ongoing administrative costs.

Solution: Employer of Record (EOR) Service

To overcome these challenges, the company partnered with an Employer of Record (EOR) service. This strategy helped streamline the hiring process and ensured compliance with local laws without the need for the company to set up a legal entity in Vietnam.

How the EOR Service Helped:

1. Recruitment: The EOR handled the candidate search using job platforms like VietnamWorks and LinkedIn, along with university partnerships for fresh graduates.
2. Legal Compliance: The EOR managed all legal aspects of hiring, including drafting contracts that adhered to Vietnamese laws. This ensured compliance with local regulations on employment contracts, taxes, and social insurance contributions.
3. Payroll & Benefits: The EOR took care of payroll, social insurance, and health benefits, reducing the administrative burden on the company.
4. Cultural & Language Support: The EOR offered insights into Vietnamese workplace culture and provided language support to ensure smoother collaboration between local and global teams.

Results

1. Faster Hiring: Within three months, the company successfully hired 25 local tech employees by leveraging the EOR’s recruitment network.
2. Cost Efficiency: The company saved on costs associated with setting up a local entity, such as legal fees and tax filing requirements.
3. Legal Compliance: The EOR ensured full compliance with Vietnamese labor laws, reducing the risk of legal issues.
4. Cultural Integration: With the help of cultural training, the global and local teams worked together more effectively.

Benefits of Using an EOR

1. Efficient Hiring Process: The EOR enabled the company to hire talent in Vietnam without setting up a local entity.
2. Full Legal Compliance: Labor laws, taxes, and social insurance obligations were managed by the EOR.
3. Access to Skilled Talent: The EOR’s local expertise helped attract top Vietnamese tech talent.
4. Cost Savings: Avoiding the costs of establishing a local entity allowed the company to expand its team without excessive overhead.

In conclusion, partnering with an Employer of Record service allowed the company to quickly and efficiently build a talented team in Vietnam, all while ensuring legal compliance and saving on operational costs.