Can AI Replace An Employer of Record?

From virtual assistants, such as Alexa and Siri, to Smart Compose in Gmail, AI is beginning to infiltrate everyday aspects of our lives, both at home and at work. But, can AI take the place of an Employer of Record or are EOR services best left in human hands? To find out, we explore how AI can manage, or mismanage, the most important aspects of what an EOR does. 

AI and employee onboarding 

The first days or weeks of your new employee’s role are some of the most pivotal, in that they set the tone for their employment with you as well as their first, and lasting impressions of your company. Therefore, it is critical that the employee onboarding process is done well, with stringent procedures in place to benefit both employees and the employer. This is even more important when onboarding international employees who may be starting out on their own or heading up your global expansion. 

Of course, as with recruitment, AI can support employee onboarding. Using chatbots to answer frequently asked employee questions, e.g. what date is payroll run, or helping over-burdened HR staff compile welcome packs or log progress on training plans, AI can take over the traditionally mundane, repetitive onboarding tasks to free up HR staff for more important tasks. 

However where AI falls down, is, quite predictably, the human side of onboarding. Up to now, AI cannot fill the gap of a qualified, personal HR contact who can cater their tone, responses and messaging for individual employee queries, of which there are often many during onboarding. 

Employment laws and regulations

Ask any chatbot about employment contracts in Portugal and they will in all likelihood be able to churn out an answer in seconds saving you ample time, money and resources investigating said regulations yourself, right? Wrong. 

While we all remain impressed with AI’s ability to answer our questions, it cannot be a substitute for in-depth, first-hand knowledge of such complex areas like employment laws. At the time of writing, AI tools lack the ability to personalise their answers on regulations to your specific business requirements. So, although AI may be able to inform you of employment legislation from around the world, it cannot take into account your company’s nuances as an expert employer of record can, which could ultimately be the difference between compliance and non-compliance, a risk that is not worth taking. 


Running payroll in multiple countries taking into account different currencies, time zones and regulations is no easy task, hence why many companies will export this to an EOR or payroll company.

AI tools can streamline this payroll process, automating tasks and speeding up pay runs each month as well as reducing the room for human error. However, as with employee onboarding, anomalies in payroll or new pay runs may need the input of a human first to tell AI what to do or to feed the payroll tool more required information.

It is also worth noting here that as AI feeds on data, data protection and privacy can become an issue. And, with different countries relying on different data protection laws, it is therefore vital that your processes, and indeed the AI you adopt, follow stringent data protection protocol. 

Can AI replace an employer of record?

In short, no. As with all new, emerging technologies the key with adopting AI into your business, especially your business growth, is balance. While AI can help streamline your processes, taking over mundane yet resource heavy tasks, at this stage AI cannot replace the expertise of on the ground EOR experts. 

Instead, it is vital to see AI as a supporting partner to your employer of record, for example supporting particular aspects of payroll or with onboarding. At Leap29, we adopt emerging technologies, such as our employee management software and our global expansion hub, LeapWorks, to help streamline your process and provide the most cost-effective, efficient EOR service for your business. It is this, combined with our team’s expertise and bespoke, catered approach that make us one of the leading employer of record partners on the market. To find out more about our EOR service, contact our team today.

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