How Employer of Record Services Help Regional Trucking Carriers Hire Drivers Across State Lines
Regional carriers often believe they must register a legal entity in every state where they employ a driver. However, that is a wrong assumption that is costing them good candidates. A carrier spends weeks sorting out tax registrations and compliance paperwork in a new state, and by the time they do, the driver they wanted has signed with someone else. An EOR, or employer of record, eliminates that bottleneck altogether. This article deconstructs how regional trucking companies leverage EOR services to hire drivers across state lines without the compliance headaches, the HR overhead, or the lost time.
Why Hiring Drivers Across State Lines Gets Complicated by Local Employment Laws
Every state has its own rules, and different employment laws from state to state seldom align with one another. A Georgia-based carrier that wants to hire a driver in Pennsylvania has a different set of requirements, including payroll taxes, workers’ compensation, health insurance, and wage laws. For example, Pennsylvania requires employers to provide some disability coverage, whereas Georgia does not.
The American Trucking Associations said in its 2024 workforce report that there is a shortage of about 60,000 drivers nationwide. That means carriers can’t afford slow hiring timelines due to state-by-state compliance requirements. Detention pay rules, stop pay calculations, and overtime classifications all vary by state. For a company doing business in seven or eight states, just keeping up with every local employment law can create constant compliance issues and major administrative burdens.
What an Employer of Record Actually Does for Trucking Companies
The carrier still makes the decision who to hire, routes, and day-to-day operations. This setup reduces compliance risk for carriers operating in multiple states. However, the EOR takes on core employment administration and the employer responsibilities that carry compliance risks across state lines.
Payroll and Tax Compliance
The EOR handles payroll processing in all states where your drivers work. That means the provider can handle payroll and running payroll across states, including calculating and withholding the appropriate local taxes, filing state payroll taxes, and managing quarterly reporting. You don’t have to establish your own entity in each state, or figure out what jurisdiction’s rules apply to what driver. The EOR already has the infrastructure built.
“Most carriers underappreciate how much time they’re losing on multi-state payroll,” says Lisa Garvey, a workforce compliance consultant who advises mid-size trucking companies. When you factor in the accounting hours and the penalties for doing it wrong, an EOR pays for itself. It can also help carriers avoid financial penalties tied to misclassification or violating local employment laws.
Human Resources & Benefits Management
Beyond payroll, the EOR handles benefits administration, including health insurance enrollment, retirement plan options, and PTO tracking as dictated by each state; better benefits and perks can also strengthen employer brand and improve retention. It also does background checks, manages onboarding for each new hire, and maintains records as required by local law. For a carrier with workers in six states, that means six different sets of rules, all managed by the EOR to reduce administrative burdens for carriers without a full internal HR team.
How an EOR Is Different from a Staffing Agency
Instead of hiring drivers from a staffing agency, an EOR uses the drivers you already found. That makes a difference. A staffing company will provide you with a revolving pool of workers who might drive for a few different carriers. But you don't have control over who turns up. Unlike HR outsourcing through a PEO, an EOR is the legal employer, while a PEO uses a co-employment model. With an EOR, you build your own team, interview candidates, and choose the best talent, so picking the right employer of record matters for control and compliance. The EOR then becomes the legal employer for tax and compliance. You control the scheduling, the routes, the performance, and everything else. The EOR does the paperwork, while the setup also gives carriers more flexibility to build a stable, reliable workforce without outsourcing hiring decisions to a third party.
What Do EOR Services Typically Cost?
EOR providers usually charge a flat monthly fee per employee or a percentage of each driver’s gross pay, typically between 5% and 15%. Think about the cost of setting up a legal entity in a new state. Filing fees, registered agent services, and ongoing state tax filings can cost $2,000 to $5,000 per state before you even think about the human resources time. An EOR eliminates much of that upfront investment and many ongoing administrative costs compared with when a business opens a foreign entity or its own entity elsewhere, which also helps reduce administrative burdens.
The National Small Business Association says small and mid-size companies spend an average of $12,000 annually on federal regulatory compliance alone. For trucking companies that do business across multiple states, that number adds up quickly and can raise compliance risk. What drives pricing is different. You have to factor in the number of drivers, the number of states you operate in, and specific needs such as tracking detention pay and stop pay calculations. To choose the right employer, buyers should also look at service scope and support.
EOR pricing is often more predictable than managing a legal entity directly, and buyers should assess whether the provider offers an easy to use platform with the features they need.
When an EOR Makes Sense for Regional Carriers
Not every carrier needs an EOR, but the fit is clear for some situations. The most friction is faced by carriers that operate routes across five to ten states and hire drivers in each state. There are also companies testing expansion plans in new markets before committing to full registration, and an EOR can help them expand when needed.
If your business doesn’t have an internal HR or compliance department, an EOR can provide that missing piece without the need to build one out. This can also be a practical alternative to building a local entity when a business opens in another jurisdiction. Forsla makes it easy to manage multi-state hiring, payroll, and compliance in one place, enabling carriers to onboard drivers quickly without getting bogged down in state-by-state red tape. Request a quote today.
Frequently Asked Questions
Can an EOR help trucking companies hire internationally?
Yes. EOR services support international employment, allowing carriers to hire workers in a foreign country without establishing a local entity. This works for companies building a global workforce or exploring global hiring for support roles.
Is the carrier still legally responsible for drivers hired through an EOR?
The EOR is the legal employer for tax, payroll, and compliance purposes. The carrier manages day-to-day operations, routes, and performance. Employer responsibilities for regulatory compliance sit with the EOR.
How long does it take to onboard employees through an EOR?
Most EOR providers can onboard a new hire within a few days. Background checks and paperwork that might take weeks when handled internally are processed faster because the EOR already has systems in place in the same state, and an easy to use platform can further speed onboarding while reducing administrative burdens.
Does using an EOR change the company’s business structure?
No. The carrier’s business structure stays the same. The EOR acts as a separate legal entity that employs workers on the carrier’s behalf, so the company does not need to open its own entity in each state.
Can an EOR handle record services for drivers in multiple countries?
Yes. Many EOR providers manage record services across multiple countries, handling payroll, local taxes, and compliance with local laws in each location. This matters for carriers with expansion plans beyond domestic routes.