What is an employer of record? What it does, what it costs and when you don't need one
An employer of record (EOR) legally employs someone on your behalf in a country where you don't have a company. It's one of four ways to have someone work for you from abroad. Here's how they compare, what an EOR costs, and when another route fits better.
Pick an EOR when you've found the person and want them as an employee. Pick a contractor for short, independent work, your own company once you have a team in one country, and a managed assistant service when you need the work done and don't want to find or manage the person.
Catalyst sells managed virtual assistants. We don't offer EOR services, and this guide says when an EOR is the better choice.
Last checked 7 October 2026
Four ways to have someone work for you from another country
| Contractor | Employer of record | Your own company there | Managed assistant | |
|---|---|---|---|---|
| Who employs them | Nobody: they invoice you | The EOR | You | The provider |
| Who finds them | You | You | You | The provider shortlists, you choose |
| Who manages the work | You | You | You | You direct it; the provider covers leave and replacement |
| Fits when | The work is independent and short | You've found someone and have no company there | You'll have many people in one country | You need the work done, not a particular person |
Calling someone a contractor doesn't make them one. In the UK, GOV.UK says employers must work out each worker's status in both employment law and tax law, and lists signs that someone is probably an employee, such as set hours and a manager who decides how the work is done. Other countries have their own tests, so check the one where the person lives.
What an EOR takes on, and what stays with you
| The EOR | You | |
|---|---|---|
| The contract | Signs a local employment contract with the person | Agree the role, salary and start date |
| Pay and tax | Runs payroll in local currency and withholds tax | Fund the salary and the employer costs, plus the fee |
| Benefits | Provides the benefits that country requires | Pay for them through the EOR |
| The work | Nothing | Direct the work, set targets, run reviews |
| Finding the person | Nothing | Find, interview and choose them |
EOR fees: what the monthly price covers and what it doesn't
| Provider | Published EOR fee | What the provider says about it |
|---|---|---|
| Deel | $599 per employee a month | Covers onboarding, local compliance, payroll, tax filings, benefits administration and HR and legal support; month to month |
| Remote | $699 per employee a month | No platform, onboarding or setup fees for its EOR product |
| Oyster | USD 699 per employee a month | Listed as its Employer of Record plan for full-time employees |
| Teamed | $599 flat per person a month | A refundable deposit of one month's salary, paid before the start |
The fee sits on top of the person's salary and the employer costs their country sets. None of the four lists finding the person in its EOR fee, or covering their work when they're away, so both stay with you.
EOR vs PEO: who is the legal employer
A PEO, or professional employer organisation, is mostly a US arrangement, used by companies that already employ people there. The IRS describes PEOs as handling payroll administration and tax reporting for their business clients, usually for a fee based on payroll. Deel calls its US PEO co-employment, which means you stay an employer and share the duties with it.
An EOR covers a country where you have no company at all. There, it's the employer and you aren't. The UK has something close in the umbrella company, which GOV.UK describes as employing temporary workers and paying them through PAYE without finding them the work. Sources: [6] [3] [7]
You might not need an EOR
You need the work done and haven't found anyone yet
An EOR needs a person to employ. If you don't have one, a recruiter or a managed assistant service has to find them first.
The work is short or one-off
A genuinely independent contractor may fit, if the work really is theirs to run.
You'll employ several people in one country
Past a certain headcount, your own company there can cost less than EOR fees. Teamed, an EOR provider, says the same on its own page.
You've found someone and want them long term
This is what an EOR is for. They employ the person you chose, in a country where you have no company.
An EOR employs the person you found. A managed assistant service finds them too.
Catalyst is the second kind. We don't take on someone you've already found: we look for candidates, screen and test them, and you choose from the shortlist. The assistant stays with Catalyst, and our Terms of Business say they're never the client's employee (clause 11).
When they're on leave, a trained backup covers. If they aren't suitable, you can ask for a replacement in the first two weeks (clause 7.2). The price is from around $8.80 an hour with the employment costs inside it, and if you later want to employ the assistant yourself, you can, with a conversion fee of 12 months' fees (clause 9.2). Sources: [8]
Questions to ask any provider before you sign
What's the monthly fee per person, and what's in it?
Get the list in writing. Ask whether the fee is the same in every country or changes with the one you hire in.
Is there a deposit, and when do I get it back?
Some providers ask for a month's salary up front.
What does it cost if the person leaves or I end it?
Notice and severance follow local law, as Deel says on its pricing page, and some providers add their own fees.
Who checks the contract against local law?
Ask for the law firm or the person by name.
Who covers the work when they're on leave?
Leave is the person's right. The work still needs doing, so ask who covers it and what that costs.
Employer of record: common questions
What does EOR stand for?
Employer of record: the company named as the legal employer on the person's contract and payroll.
Is an employer of record the same as a PEO?
No. A PEO shares employer duties with a company that already employs people, mostly in the US. An EOR is the sole employer in a country where you have no company. Sources: [6] [3]
How much does an employer of record cost?
Published fees run from $599 to $699 per person a month at Deel, Remote, Oyster and Teamed (read 7 October 2026), on top of salary and employer costs. Sources: [3] [4] [5] [2]
Can I use an EOR for someone I found myself?
Yes. That's the job an EOR does. You find and manage the person; the EOR employs them.
Is Catalyst an employer of record?
No. We're a managed assistant service. We find and vet the assistant, employ them, cover their leave and replace them if needed. We don't employ people a client brings to us.
Do I need an EOR to work with a freelancer abroad?
Not if they're genuinely self-employed. Whether they are depends on how the work is set up, and each country has its own test; GOV.UK sets out the one for the UK. Sources: [1]
Sources
- GOV.UK: Employment status, employee, read 7 October 2026
- Teamed: How an employer of record works, read 7 October 2026
- Deel: Pricing, read 7 October 2026
- Remote: Pricing and plans, read 7 October 2026
- Oyster: Pricing, read 7 October 2026
- Internal Revenue Service: Certified professional employer organization, read 7 October 2026
- GOV.UK: Working through an umbrella company, read 7 October 2026
- Catalyst Outsourcing: Terms of Business, read 7 October 2026