How much does an employer of record cost?

Advertised prices, verified

How an EOR invoice is built

1. The management fee. A flat amount per employee per month at the advertised tier, or a percentage of salary at some vendors. Flat fees make costs predictable as salaries rise; percentage pricing quietly charges more for your most senior hires, so ask for the flat equivalent in writing.
2. Salary and employer costs at pass-through. Gross salary plus the statutory employer contributions of the hire's country: social insurance, pension, levies and mandatory benefits. These are set by law, not by the vendor; a quote that looks cheap usually looks cheap here, by understating employer costs the law will collect anyway.
3. Deposits and onboarding charges. Many vendors hold a deposit, often one to three months of total employment cost, to cover termination liabilities, and some charge setup fees. Ask what is held, whether it earns interest, and exactly when it is returned after offboarding, because this is the line clients forget until exit.
4. The extras that arrive later. Currency conversion margins, benefits administration fees, off-cycle payroll runs, equipment logistics and visa work are commonly priced separately. Get the full price list before signing, then compare vendors on a specimen invoice for your actual hire rather than on headline fees.

What drives the fee up or down

Country is the biggest driver. Markets where employment is administratively heavy, with complex contributions, mandatory benefits or strict termination rules, cost more to serve, and vendors price that in either openly with per-country rates or quietly with a higher blended fee. Whether the vendor employs through its own local entity or a partner matters too: partner models add a margin-carrying layer, while owned-entity models concentrate accountability but limit country coverage. Volume moves the price; most vendors discount visibly from a handful of employees, so a quote for one hire is the ceiling, not the market rate.

The advertised tier is a floor in another sense: it typically covers standard employment in the vendor's core countries, with visa sponsorship, senior-hire complexity and non-standard benefits priced above it. None of this makes advertised pricing meaningless; it makes it a starting point that verified comparison can hold vendors to. The table on this page shows what each vendor publishes, with the vendor's own page linked beside every figure, so the gap between the advertisement and your quote is at least visible.

EOR cost against the alternatives

The honest comparison is not the fee against zero; it is the fee against opening and running an entity. Incorporation, registered address, local accounting, payroll registration, annual filings and eventual liquidation carry both fees and internal time, and for one to five employees in a country the EOR is usually cheaper even at the top of the fee range. The crossover arrives with headcount: at tens of employees in one country the accumulated monthly fees exceed what a local entity costs to run, which is why the standard pattern is EOR first, entity when a market proves out.

The other alternative, engaging people as contractors, is cheaper only while the classification holds. A full-time person working under your direction is an employee in substance in most jurisdictions, and reclassification brings back taxes, contributions and penalties that dwarf years of EOR fees. Priced honestly, the EOR fee is what lawful employment in a country costs when you do not want to build the machinery yourself; nothing on this page is legal or tax advice, and the vendor agreement you sign controls what you actually pay.

Common questions

What does an EOR cost per employee per month?

Vendors in this index that publish pricing advertise entry tiers in the low hundreds of dollars per employee per month, median $499. The advertised tier is the management fee only; salary, employer contributions, benefits and any deposit come on top, at cost.

Why do EOR quotes differ so much for the same hire?

Different assumptions, mostly: which employer costs are shown versus left to appear later, whether a deposit is required, what the currency margin is, and whether the country is served by an owned entity or a partner. A specimen invoice for the actual hire, itemised line by line, makes quotes comparable.

Are there hidden costs to watch for?

The recurring ones are currency conversion margins on payroll funding, deposits held until after offboarding, off-cycle payroll charges and offboarding or severance administration fees. All are askable in advance; the vendors' own agreements state them, which is why reading the agreement beats reading the pricing page.

Is a percentage-of-salary fee ever better than a flat fee?

For low salaries it can price below flat tiers, which is why some vendors offer it. The cost is predictability: every raise raises the fee. If a vendor quotes a percentage, ask for the flat equivalent and compare both against the salaries you actually plan to pay.

Coverage by country

• Employer of record vendors covering Singapore
• Employer of record vendors covering Mexico
• Employer of record vendors covering Spain
• Employer of record vendors covering Colombia
• Employer of record vendors covering United Kingdom
• Employer of record vendors covering France
• Employer of record vendors covering Hungary
• Employer of record vendors covering New Zealand