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Employer of Record
Company
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Employer of Record
Company
Talk to an expert
Complete Guide 2026

Employer of Record (EOR):
Hire Globally,
Without the Complexity

An EOR becomes the legal employer of your international staff — handling payroll, contracts, taxes and compliance — so you can focus on your business.

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Countries covered
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Average onboarding time
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Entity setup cost
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Local law compliance
Key takeaways
  • An Employer of Record (EOR) is a third-party company that legally employs workers on behalf of another business.
  • With an EOR, you can hire in any country without setting up a local legal entity — saving months of setup time and thousands in legal costs.
  • The EOR handles payroll, taxes, benefits, employment contracts, and compliance with local labor law.
  • EOR pricing on the market typically ranges between $300 and $700 per employee per month — far less than setting up a local entity. MBRemote's pricing is custom-quoted based on your specific situation.
  • MBRemote operates as your EOR in 20+ countries, with dedicated local compliance experts.
In this guide
  1. What is an Employer of Record?
  2. How does an EOR work?
  3. What does an EOR do?
  4. Benefits of using an EOR
  5. EOR vs PEO
  6. EOR vs Staffing Agency
  7. EOR vs Local Entity
  8. Owned-Entity vs Partner EOR
  9. When should you use an EOR?
  10. How much does an EOR cost?
  11. How to choose an EOR provider
  12. EOR by country
  13. FAQ
01 — Definition

What is an Employer of Record (EOR)?

An Employer of Record (EOR) is a third-party organisation that takes on the legal responsibility of employing workers on behalf of another company. The EOR becomes the official employer in the worker's country — handling payroll, taxes, employment contracts, and compliance with local labour law — while the client company retains full control over the employee's day-to-day work, tasks, and performance.

In simple terms: you find the talent, we handle everything else.

The three-party legal relationship

  • You (the client company) — direct the employee's work, set objectives, manage performance.
  • The EOR (MBRemote) — the legal employer of record, responsible for payroll, contracts, taxes, and compliance.
  • The employee — works for you in practice, legally employed by the EOR in their home country.

What an EOR is NOT

  • An EOR is not a staffing agency — it does not recruit candidates. You choose your own talent.
  • An EOR is not a PEO — a PEO requires you to have an existing legal entity. An EOR does not.
  • An EOR is not a contractor platform — EOR employees receive full employment rights, benefits, and protections under local law.
02 — Process

How does an Employer of Record work?

The EOR model is straightforward. From hire to operational employee — typically in 48 to 72 hours, versus 2–6 months to incorporate a local entity.

01
You identify the candidate
In any country where you want to expand. The hiring decision is entirely yours.
02
You agree on role, salary, and start date
Share these details with MBRemote. We prepare all the paperwork.
03
MBRemote drafts a locally compliant contract
Tailored to the labour laws of the employee's country — probation, notice periods, IP clauses, all statutory terms.
04
The employee is onboarded
Officially employed by MBRemote in their country, working for you.
05
MBRemote runs payroll monthly
All taxes, social charges, and statutory contributions deducted and remitted automatically, in local currency.
06
You manage the work
Day-to-day direction, objectives, performance — all remain entirely with you.
03 — Scope

What does an Employer of Record do?

An EOR assumes all employer responsibilities in the country of hire. Everything MBRemote manages on your behalf:

Employment contracts
Locally compliant with probation periods, working hours, notice periods, IP clauses, and all statutory terms.
Payroll in local currency
On-time monthly payroll including variable pay, commissions, and bonuses in the employee's local currency.
Tax withholding & filing
Income tax, social security, pension — calculated, withheld, and filed automatically.
Statutory benefits
Health insurance, pension, paid leave, maternity/paternity — every mandatory benefit required by local law.
Labour law compliance
Proactive monitoring of legal changes, minimum wage updates, new regulations.
IP & data protection
Robust IP assignment and confidentiality clauses to ensure all work created belongs to your company.
Offboarding & termination
Notice periods, severance, final pay, documentation — all in full compliance with local law.
Multi-country expertise
Dedicated local HR and legal experts in each country.
04 — Advantages

What are the benefits of using an Employer of Record?

No local entity required
Setting up a subsidiary typically costs $15,000–$50,000+ in year one and takes 2–6 months. With an EOR, your employee is operational in 48 hours — with zero setup cost.
Enter new markets in days
When you identify a market opportunity, an EOR lets you act immediately — no entities or regulatory approvals needed.
100% local law compliance
Wrong contributions, non-compliant contracts, missed benefits — these expose you to fines. An EOR eliminates this risk entirely.
Eliminate misclassification risk
Contractors that should be employees expose you to penalties and back taxes. EOR provides proper employment from day one.
Significant cost savings
For fewer than 8–10 employees per country, EOR is almost always cheaper than a local entity.
Focus on your business
Payroll, compliance, contracts — not your core business. Delegate them to focus on growth, product, and customers.
05 — Comparison

Employer of Record vs PEO: what is the difference?

  • A PEO is a co-employment arrangement that requires you to already have a legal entity in the country.
  • An EOR does not require any local entity. The EOR is the legal employer in the country.
In short: if you don't have a local entity, you need an EOR, not a PEO.
EORPEO
Requires local entityNoYes
Legal employerEORShared (co-employment)
New market entryYesNo
Full compliance managementYesPartial
06 — Comparison

Employer of Record vs Staffing Agency

  • A staffing agency finds the candidate for you. The worker is typically temporary.
  • An EOR employs a worker that you have already identified. Employment is permanent.
EORStaffing Agency
Who finds the candidate?You doThe agency
Employment typePermanentOften temporary
Team integrationFullPartial
Best forLong-term, strategic hiresShort-term resource needs
07 — Comparison

Employer of Record vs Setting Up a Local Entity

EORLocal Entity
Setup time48–72 hours2–6 months
Setup cost$0$15,000–$50,000+
Monthly cost~$300–$700/employee (market) — MBRemote: on request$2,000–$5,000 (fixed overhead)
Ideal for1–10 employees per country10+ employees, long-term
Compliance riskManaged by EORYour responsibility
Flexibility to exitHighLow (complex, costly)
Rule of thumb: Use an EOR when testing a new market or hiring fewer than 8–10 people in a country. Establish a local entity once your presence is large enough to justify the fixed overhead.
08 — Critical distinction

Owned-Entity EOR vs Partner-Dependent EOR

Not all EOR providers are built the same. This is the most important factor to evaluate.

Partner-dependent EOR
Many EOR providers don't actually own entities in the countries they cover. Instead they work through a network of local partners — third-party employers you may never have vetted.

Owned-entity EOR: the MBRemote model

An owned-entity EOR has its own legal entities incorporated in every country it covers. When MBRemote employs your worker, they are employed directly by MBRemote's local entity — not a third party.

Full control & accountability
At every level of the employment relationship, with no hidden sub-contracting chain.
Consistent compliance standards
The same high standards across all 20+ countries.
No hidden sub-contracting
You know exactly who employs your team. No opaque third-party arrangements.
Significantly lower risk
With owned entities, MBRemote is always the employer — no partner failure risk.
"Do you own your entities in the countries where you'll be employing my team?"
Ask this question to any EOR provider you evaluate. The answer will tell you everything.
09 — Use cases

When should you use an Employer of Record?

Market testing
Establish a presence in a new country before committing to a full entity setup.
Immediate hiring
You've identified a candidate and need them employed legally within days.
Small international headcount
Fewer than 10 employees per country — entity overhead not yet justified.
Compliance risk reduction
Regularise contractors who should legally be employees with EOR.
Post-acquisition integration
Absorb employees before your entity is established in a new market.
Remote-first teams
Hire talent wherever the best people are, regardless of geography.
10 — Pricing

How much does an Employer of Record cost?

Most common
Flat monthly fee
~$300–$700/employee/month (market)
The most transparent model — a fixed cost regardless of salary level. MBRemote prices on request, tailored to country and profile.
Less transparent
Percentage of salary
5–15% of gross salary (market)
Used by some competitors, this model penalises senior employees — costs escalate quickly with higher salaries.

What's included in MBRemote's fee

Employment contract drafting and management
Monthly payroll processing in local currency
Tax and social contribution filing
Statutory benefits management
Ongoing compliance monitoring
Employee support
Offboarding and termination management

Real example: hiring in France

Example: 1 employee in France — Year 1 cost comparison
EOR market range (indicative)~$300–$700/month
MBRemote EOR — custom pricingOn request
French subsidiary (legal + notary + accountant + annual filings)$15,000–$30,000+ (year 1)
Significant potential savings with EOR in year one
11 — Selection guide

How to choose an Employer of Record provider

1
Do they own entities in your target countries?
Owned-entity providers offer significantly better compliance guarantees. Always verify this for each country you need.
2
What countries do they cover?
Ensure coverage of both current needs and anticipated expansion countries. Switching EOR providers mid-growth is disruptive.
3
What level of compliance expertise do they offer?
Look for dedicated local HR and legal experts. Employment law in France is fundamentally different from the UAE or Brazil.
4
How fast is the onboarding process?
Industry benchmark: 48–72 hours from signed MSA to active employment contract.
5
What does the technology platform look like?
A modern EOR platform should give you real-time visibility into payroll, contracts, compliance status, and employee data.
6
What do their clients say?
Check Trustpilot, G2, and Clutch. Pay attention to reviews from companies of your size and in your target countries.
Questions
Frequently asked questions
Everything you need to know about Employer of Record — before you sign.
What is an Employer of Record?
An Employer of Record (EOR) is a third-party organisation that legally employs workers on behalf of another company. The EOR handles payroll, taxes, employment contracts, benefits, and compliance with local labour law — while the client company directs the employee's work on a day-to-day basis.
What is the difference between an EOR and a PEO?
A PEO requires you to already have a legal entity in the country where you want to hire. An EOR does not — the EOR is the legal employer in the country. If you don't have a local entity, you need an EOR, not a PEO.
What is the difference between an EOR and a staffing agency?
A staffing agency recruits candidates and places them in temporary roles. An EOR employs candidates that you have already identified and selected, on a permanent basis, and integrates them fully into your team. With an EOR, you choose your own people.
Is it cheaper to use an EOR or set up a local entity?
For most companies with fewer than 8–10 employees in a single country, EOR is significantly cheaper. Setting up a local entity typically costs $15,000–$50,000+ in year one, plus ongoing annual maintenance. Market EOR rates typically range from $300–$700 per employee per month. MBRemote prices on request, tailored to your country, headcount and profile — contact us for a custom quote.
How long does it take to hire through an EOR?
With MBRemote, the average time from signed service agreement to active employment contract is 48–72 hours. This compares to 2–6 months to establish a local legal entity.
How much does an Employer of Record cost?
Market EOR rates typically range from $300–$700 per employee per month (flat fee) or 5–15% of gross salary depending on the provider. MBRemote prices on request — tailored to your country, profile and headcount. Contact us for a personalised quote.
Who is responsible for compliance when using an EOR?
The EOR assumes full responsibility for employment compliance — including payroll tax filings, statutory benefits, labour law compliance, and employment contract legality. You remain responsible for directing the employee's work.
Is using an EOR legal?
Yes. Employer of Record is a fully legal and widely used employment model globally. MBRemote's employment contracts are drafted by local legal experts and are fully compliant with the labour law of each country.
What countries does MBRemote's EOR cover?
MBRemote currently provides EOR services in 20+ countries, including France, Morocco, Spain, the Netherlands, Belgium, Portugal, Romania, and the UAE. See the full country list.
Does an EOR own entities in the countries it covers?
MBRemote operates through owned entities in its core markets — meaning your employees are employed directly by MBRemote's local subsidiary, not through a third-party partner.
No entity required
Ready to hire globally
without the complexity?
MBRemote's Employer of Record service lets you onboard employees in 20+ countries in 48 hours — fully compliant, no entity required, transparent pricing.
Talk to an expert See covered countries
Owned entities 48h onboarding Transparent pricing 20+ countries