If you’re expanding your business internationally, you’ve probably thought about using an Employer of Record (EOR). It is one of the fastest and most compliant ways to hire employees abroad without a legal entity.
But the most common question that businesses often have is: How much does an EOR really cost?
To simply answer your question, there is no fixed cost. Depending on whether you’re hiring in your home country or abroad, the location of your employees, salaries, and other benefits, the EOR services can cost from around $200 to $700 per employee per month.
In this blog, we’ll explain the cost components of EOR services and what to expect when budgeting for one.
How EOR Pricing Works?
Before we get into specifics, it’s important to note that most of the EORs don’t just charge a flat fee. Their price structure, however, consists of a number of elements, some fixed, some variable.
For instance, if you are hiring an employee in a country with high employer taxes, your overall EOR cost will be higher. Some EOR providers also provide all-inclusive packages, while others charge for compliance, payroll management, and employee benefits separately.
Now, let’s take a look at the main cost factors that influence EOR pricing.
Factors That Determine the Total Cost to Employer When Using EOR?
1. Employee Salary & Employer Contributions
When hiring remote talent using an EOR, one of the biggest expenses, of course, is the employee’s salary, including mandatory employer-paid contributions. The additional cost depends on the country where the employee operates and usually includes:
- A percentage of the employee’s salary to state benefits.
- Some countries require employers to pay into unemployment funds for their workers.
- Depending on the country, employers may be required to contribute to retirement savings plans.
To give you an idea, in some European countries, employer contributions can be up to 30–40% of the employee’s salary, whereas in Vietnam, they are usually less.
An EOR calculates these costs, ensures compliance, and pays them on your behalf.
2. EOR Service Fees
The cost of managing employment contracts, payroll, compliance, and HR administration is included in the service fee charged by every EOR provider. This fee is commonly structured in one of the following ways:
- A fixed monthly fee per employee (e.g., $300 per employee)
- A percentage of the employee’s salary (e.g., 10% of gross salary)
3. Setup & Onboarding Costs
Generally, an onboarding fee is required when you hire a new employee through an EOR. This is meant to cover:
- Drafting employment contracts according to local laws.
- Registering the employee with tax and labor authorities
- Setting up payroll & compliance checks
Some EORs include these costs in their service fee and do not require extra charges, while others charge separately for each additional aspect for every new hire.
4. Refundable Security Deposit
Several EOR providers ask for a security deposit as financial protection, often equivalent to an employee’s notice period salary or a percentage of monthly pay. This deposit is insurance against contract breaches, unpaid salaries, or sudden terminations.
Furthermore, these security deposits help to ensure that EOR providers can offer separation pay to eligible employees upon termination to comply with local laws (if required).
5. Additional Employee Benefits
Some employers want to provide the most benefits for their remote employees such as home office setup, private health insurance, equipment, and more. This helps them stay competitive and attract top talent wherever they are hiring..
Therefore, if you are offering those, the EORs would include the price in your monthly invoice.
Additionally, some EORs also allow you to customize benefits packages according to your budget and needs.
6. Currency Exchange & Payment Processing Fees
If you’re paying employees in different currencies, exchange rate fluctuations and transfer fees can make your costs even higher. A good EOR:
- Allows employees to be paid in their local currency
- Helps businesses navigate currency volatility
- Minimizes financial risks resulting from exchange rate changes
For example, if your home currency depreciates against the local currency, your payroll expenses could increase unexpectedly. To save you from unexpected payroll cost increases due to currency depreciation, certain EORs like RecruitGo offer currency hedging services to help stabilize expenses.
EOR Pricing Comparison: Finding the Best Fit for Your Business
Our local experts have compared the prices of the leading Employer of Record (EOR) providers to help you make an informed decision. Below is a breakdown of pricing from various companies that offer a competitive pricing model.
| EOR Provider | Starting Price | Pricing Model | Key Features |
| Remofirst | $199 per employee/month | Flat monthly fee | 180+ countries, tax compliance, benefits, HR guidance |
| Skuad | $199 per employee/month | Flat monthly fee | Payroll in 70 currencies, local compliance, benefits, contracts |
| Agile | $399 per employee/month | Flat fee (15% discount if paid annually) | Payroll, compliance, and benefits in multiple countries |
| Omnipresent | £499 (~$630) per employee/month | Flat monthly fee | 100% compliant payroll, HRIS integration, IP protection |
| Papaya Global | $599 per employee/month | Flat monthly fee | Built-in EOR payments, CPA-certified, automated onboarding |
| Deel | $599 per employee/month | Flat monthly fee | Compliance, taxes, benefits, international hiring |
| Oyster | $699 per employee/month | Flat monthly fee | Hire in 130+ countries, IP protection, payroll in 140+ currencies |
| Recruit Go | 10% of employee’s gross salary (Capped at $250 per employee) | Percentage-based model | Flexible pricing, payroll, local compliance, and benefits management included, budget-friendly for high salaries |
Considering that, most of the Global EOR service providers like Deel and Skuad, which have wider coverage, charge anywhere from $200/month per employee to $700/month for each employee. The most significant advantage with them is that you can hire employees across all major markets from the US and Canada to the EU and Asia.
However, if you are looking to hire in specific countries, you can reduce your costs significantly by using local employer-of-record service providers such as RecruitGo.
As an example, if you are hiring employees in Southeast Asian markets such as Vietnam, Philippines, Indonesia, etc, using EOR providers such as RecruitGo will probably cost you anywhere from $50 to $150. That is because they charge a certain percentage of an employee’s gross salary as an EOR fee, and these countries have average salaries ranging from $500-$1500 per month, depending on role, experience, etc.
Key Questions to Ask Your Potential EOR Partner
In addition to pricing, you should also ask yourself the following questions before selecting an EOR provider:
- Ask the EOR if they have a legal entity established in your target country and how long they have been operating there.
- Ask the EOR how many employees they currently manage in your target market and whether they have experience handling complex labor laws in that region.
- Ask the EOR if they handle full compliance, including drafting employment contracts, managing payroll, handling tax filings, and administering employee benefits.
- Ask the EOR for a detailed cost breakdown, including payroll processing fees, employer contributions, currency exchange costs, and any hidden charges.
- Ask the EOR if they offer HR administration, visa management, and reporting analytics as part of their base package or if they charge extra for these services.
- Ask the EOR if they provide a technology platform for payroll processing, employee record management, and reporting, and request a demo to assess its functionality.
- Ask the EOR about their customer support process, how they handle urgent payroll or compliance issues, and if they have dedicated account managers for ongoing
Conclusion
Selecting an employer of record (EOR) is a decision that affects your business’s growth, compliance, and operational efficiency. As we explored in the article above, the cost of an EOR is influenced by the location your business operates in, the service scope, compliance requirements, and additional fees.
While big players in the industry are competitive, the right choice for you depends on your company’s specific needs and budget. Investing in a reliable EOR will make your expansion smooth and your business agile and compliant in the market. Before partnering up with any EOR provider, carefully compare the providers and select the one that best fits your growth strategy.