Looking to expand your business abroad? Companies need to consider the complexities of employing overseas workers in the UK. Make sure to ensure that you clearly understand what options are available and any potential issues that may arise.

Expanding into the United Kingdom can be a complicated process. Key challenge companies face is acquiring workers to build out their business when they do not yet have an established UK-based entity or require visas for these employees. Fortunately, many alternatives are available as workable solutions!

Employer of Record (EoR)

Employment is turning into a three-way relationship: the worker, their Supervisor and an Employer of Record (EoR). This EoR takes on legal responsibility for paying wages and managing any disputes, allowing companies to have more flexibility as they hire. Companies no longer need to worry about the tedious HR duties of their employee’s tax and payroll responsibilities. Partnering with an EoR allows them to focus on work while still taking advantage of the worker’s services.

For companies looking to expand into the UK, establishing an EoR is a great way for teams to grow. This allows organisations to hire and transfer employees across borders without having to go through difficult incorporation processes! Going with an EoR can be a great way to reduce HR costs and help streamline the hiring process. However, it is important to understand that this model also comes with some potential risks.

The global EoR market has seen a tremendous uplift due to the pandemic, set to reach unprecedented heights by 2028. Companies often use these third-party services for expansion into new markets or when making only one or two hires at first – typically transitioning away from them within 18 months.

Sponsor Worker Visa

UK work-based visas pose a major challenge to companies looking to transfer an international worker. The most commonly used visa is the Skilled Worker route, which requires sponsorship from a UK company to succeed. Companies wishing to hire foreign workers must obtain a Sponsor Licence and meet certain obligations regarding filing paperwork and record-keeping. Once done, the worker applies for a visa which will grant them the permission to take on the role specified on the application.

As a sponsor, you are accountable for the tasks and results of any foreign workers operating in the UK. It is important to ensure that everyone hired can fulfil their role according to expectations. For employees sponsored by a registered employer, tasks are usually completed under their supervision. But when these workers work for another company instead of the sponsor, issues may arise.

Working on a contract basis with a third party can provide unique opportunities, however, it is subject to specific conditions:

  • Organizations must be mindful of the time-sensitive nature when contracting out specific work tasks.
  • Sponsors should always remain actively engaged in overseeing and directing any contracted worker’s daily duties.

Employers of Record (EoR) who assume the role of a sponsor for foreign workers and then outsource them to other companies are risking serious repercussions. The UK Home Office may revoke the EoRs’ sponsorship license, leading to all associated visa holders having their visas cancelled. In this scenario, companies must act quickly to secure their workers’ residency in the UK or risk losing them! They need to create a British entity, switch employment contracts and get a payroll set up all at once.


For companies expanding into the UK using an Employer of Record (EoR) is a tempting solution, however there are some major risks to consider regarding sponsorship visas. To ensure stability and security when entering the British market, it’s important to explore other visa routes as well.

Global Business Mobility (GBM) – UK Expansion Worker Visa

With the Global Business Mobility-UK Expansion Worker Visa (GBM), companies outside of the UK are now able to expand their global footprint by sending up to five workers. This exciting initiative gives companies a unique opportunity to establish and grow an entity in the UK! Setting up an entity requires only one crucial component; your intent. When applying, you must be able to demonstrate a UK presence either as registration at Companies House or with a registered office address in the UK. With the right business plan, you can quickly secure an initial two-year UK GBM visa for your employees without completing all setup requirements first.

To obtain the GBM visa, workers must meet specific criteria. This includes taking on roles at degree level in Britain and earning at least £44,400 if employed overseas for more than a year. Those who have been with the company less time will need to be earning above £73,900 in the UK.

The UK is taking steps to expand its presence in the world, and this involves setting up an entity within two years that enable workers from abroad the opportunity to apply for skilled worker visas and a chance of indefinite leave to stay after five years.

It is important to exercise caution when considering an Employer of Record (EoR) for UK expansion plans and visas. However, the process can be rewarding, allowing security in conformity with immigration law while setting up a business entity in the UK. With some tasks more complex than others, these steps are necessary for successful business expansion in the UK!