How much does an employer of record cost?

Priced per employee per month rather than as a percentage of salary, which keeps cost predictable as compensation rises. For a handful of employees it typically costs less than establishing and running a local entity until roughly two years in.

Should we set up an entity instead?

It depends on headcount, country, and certainty. Entity costs are largely fixed while EOR scales per person, so twenty employees crosses over far sooner than five. An entity is also a multi-year commitment with wind-down costs if the market does not work out, which is exactly the risk EOR removes.

How quickly can someone start under EOR?

Days rather than months. Entity registration, tax IDs, banking, and payroll setup typically take months before anyone can legally begin, by which time a preferred candidate has often accepted elsewhere.

Can we just engage them as a contractor instead?

It is common and it is risky. Most jurisdictions determine employment status by the substance of the relationship rather than the contract label, so a full-time worker on your schedule and systems is usually an employee regardless. Exposure is back-dated and tends to surface during funding or acquisition diligence.

Can you convert our existing contractors to compliant employment?

Yes, and it is a common reason companies come to us. Doing it proactively is generally simpler than after a tax authority or an acquirer's counsel raises the question.

Which countries do you cover?

India, the UAE, the UK, Europe, and Latin America. Outside those we will refer you rather than improvise in a jurisdiction we do not operate in.

Do you also find the candidates?

Yes, if you want. Recruitment runs at a flat 14% outside India or 7% within it through our global staffing service, with the same AI first-round interview used across every market, and employment then runs through EOR.

Service · Employer of Record

Hire International Employees

Employ people in countries where you have no legal entity. We become their employer, handle payroll, tax, and statutory benefits, and you direct the work. Priced per employee per month, with the entity-versus-EOR arithmetic published below.

Last updated on: July 9, 2026Read time: 6 mins

Written byAdithyan RKFact checked bySurya N

Days

To employ, not months

Per employee

Monthly pricing, no percentage

900K+

AI interviews conducted

~2 yrs

Typical entity crossover point

Hyring acts as employer of record in countries where you have no legal entity. We employ the person under a compliant local contract, run payroll, withhold taxes, provide statutory benefits, and handle filings. You direct their work exactly as you would any team member. Pricing is per employee per month rather than a percentage of salary.

Most companies arrive at this service after trying one of two alternatives. They either start registering a subsidiary and discover it takes months and creates permanent obligations for a team of three, or they engage the person as a contractor and quietly accumulate misclassification risk in a jurisdiction whose rules they have not read. Both are avoidable, and the arithmetic below shows when each genuinely makes sense.

What an Employer of Record Does

The EOR is the legal employer; you remain the operational manager. The split is legal and administrative, not managerial.

Who does what under an employer of record arrangement

Responsibility	Hyring	You
Employment contract and legal employer status	Yes	No
Payroll, tax withholding, statutory filings	Yes	No
Statutory benefits and local entitlements	Yes	No
Day-to-day direction, priorities, and review	No	Yes
Tools, systems, and team integration	No	Yes
Deciding who to hire	No	Yes

Entity or EOR: The Arithmetic

For a handful of employees, EOR costs less until roughly two years in; entity setup wins at larger headcount or longer horizons.

Three factors move that crossover. Headcount is the biggest, since entity costs are largely fixed while EOR scales per person, so twenty employees crosses over far sooner than five. Country matters, as registration and ongoing compliance burden vary enormously. And certainty matters most of all: an entity is a multi-year commitment with wind-down costs if the market does not work out, which is precisely the situation EOR exists to de-risk.

What Each Route Requires

Entity setup runs in months and creates permanent obligations; EOR employment can begin in days.

The elapsed time is what most plans underestimate. A hiring decision made in January under the entity route frequently means the person starts in the second quarter, by which time your preferred candidate has usually accepted something else.

The Contractor Shortcut, and Why It Fails

Engaging a full-time worker abroad as a contractor to avoid entity setup creates misclassification exposure in a jurisdiction whose rules you have not read.

The reasoning is always the same and always understandable: entity setup is slow, EOR looks like an extra cost, and the person is happy to invoice. The problem is that most jurisdictions determine employment status by the substance of the relationship rather than the label on the contract. Someone who works full time, on your schedule, under your direction, with your tools, using your systems, is an employee in the eyes of most tax and labour authorities regardless of what the agreement says.

The exposure is asymmetric and back-dated: unpaid employer contributions, statutory benefits owed retrospectively, penalties, and in some jurisdictions personal liability for local directors. It also tends to surface at the worst moment, during diligence for a funding round or acquisition, when a buyer's counsel asks how your overseas team is engaged.

Converting existing contractors onto compliant employment is a common reason companies come to us, and it is generally easier to do proactively than after an authority or an acquirer raises it.

Fact

90-day replacement commitment. If a placed hire leaves within 90 days, we replace them under the agreed terms. Ask any agency whether their guarantee provides a replacement or a refund, and over what period, because those are materially different commitments that get conflated in most contracts.

How It Works With Hyring

We can employ someone you have already found, or find and then employ them, with the same screening standard as every other service.

You already have the person. Straight EOR: we issue a compliant local contract, onboard them, and run payroll from the first cycle. Common when converting a contractor or hiring someone a team member already knows.

You need to find them first. Recruitment through our global staffing service at a flat 14% outside India or 7% within it, then employment through EOR. Every candidate completes the same AI first-round interview used everywhere else.

Round one, already done

Every candidate completes an AI first round before you see them: video, coding, phone, or the English test.

Every applicant ranked

The AI Resume Screener scores the full funnel against your brief, so nothing strong gets buried under volume.

Thousands of recruiters

The Recruiting Partners network works each role nationally, paid on placements, every submission passing the same screen.

Panel rounds in Hyring Meet

Interviews are scheduled and held in Hyring Meet, so invites and recordings stay attached to the candidate record.

One portal, no chasing

Every candidate uploaded with recording and score, clear stages your whole team sees, feedback on the profile instead of an email thread.

Transparency after the hire

Augmented teams run on Insight by Hyring, employees seeing their own data first. SOC 2 Type II and ISO 27001 certified.

Where the requirement is capacity rather than employees on any payroll of yours, staff augmentation is usually cheaper again, since you are buying the work rather than the employment relationship.

When EOR Is the Wrong Answer

Skip EOR when you already have an entity, when headcount is large enough to justify one, or when you need capacity rather than employees.

Written by

Adithyan RK

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CEO & Co-founder, Hyring

18+ years of experience

Adithyan RK is the Co-Founder and CEO of Hyring, an AI-native recruitment platform that has run over 900,000 AI interviews for companies ranging from early-stage startups to the Fortune 500. He has spent 18 years building technology businesses, starting with a digital consultancy in 2008 and a staff augmentation firm in 2017, before founding Hyring in 2022 to rebuild hiring around evidence instead of guesswork. Read more

Expertise

AI RecruitmentAI InterviewsRecruitment AutomationHR TechnologyHiring AnalyticsApplicant TrackingRecruiter Operations

Fact checked by

Surya N

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CTO & Co-founder, Hyring

6+ years of experience

Surya N is the Co-Founder and CTO of Hyring, where he architected the AI interviewing engine that has now conducted over 900,000 interviews for companies ranging from early-stage startups to the Fortune 500. A mechanical engineer who moved into artificial intelligence, he spent 6 years building AI applications inside a technology consultancy before co-founding Hyring, and wrote the first version of its AI interviewer from scratch. Read more

Expertise

AI Interview SystemsConversational AIInterview Fraud DetectionPlatform ArchitectureMachine Learning EngineeringApplied AISpeech and Voice AIBias Testing and Model Evaluation

FAQs

A company that legally employs workers on your behalf in a country where you have no entity. Hyring issues the employment contract, runs payroll, withholds taxes, provides statutory benefits, and handles filings, while you direct the person's day-to-day work.