one of my employees got a 38k tax bill from the german government and our EOR went AWOL
so this just happened, one of my employees in germany sent me a photo of a letter from the Finanzamt this morning saying he personally owes 38k in unpaid social security contributions going back over a year.
I panicked and called our EOR, who ghosted me for 2 hours before sending a one-line email saying their partner network in germany was experiencing operational delays.
i did some digging because what the hell…
turns out the EOR we've been paying every month is a cyprus-based holding company that subcontracts to a german GmbH for employment, except that german GmbH filed bankruptcy back in February, which means our money has been getting pocketed somewhere in the chain ever since.
The EOR obviously knew the whole time because they kept billing us anyway.
We bit the bullet and paid the 38k out of pocket for our employee yesterday because what else are you going to do, leave him on the hook for someone elses fraud.
we fired the EOR the same day and we’ll be moving everyone over to a more established EOR like Deel or Workmotion who at least own their own GmbH and can be looked up in the Bundesanzeiger.
Anyway, if you're hiring through an EOR check that your employer of record exists as a real legal entity in the country (should be the bare minimum but here we are).