Comparison
EOR vs PEO: which one do you actually need?
They sound similar and the marketing pages blur the line on purpose. Here's the clear difference, when each one tends to win, and what they typically cost.
EOR
Employer of Record (EOR)
An EOR is a third-party company that legally employs your worker in a country where you have no entity. They run payroll, file taxes, and carry compliance risk under their own local tax ID. You direct the work; they're on the legal hook.
- No entity required
- Global, typically 80–150+ countries
- Onboarding in 1–5 days
- Per-employee fee ($199–$770/mo)
PEO
Professional Employer Organization (PEO)
A PEO is a co-employer, you already have a local entity and the PEO takes over HR admin, payroll, and benefits under a shared employer relationship. Almost entirely a US construct; "international PEO" is usually just EOR rebranded.
- Requires you to have a local entity
- Cheaper per-employee fee
- Access to group health & 401k rates
- US-centric, limited international reach
Legal employer
- EOR
- EOR is the legal employer in-country
- PEO
- Co-employment, you remain the legal employer
Needs a local entity?
- EOR
- No
- PEO
- Yes (you must already have one)
Best for
- EOR
- Hiring abroad with no entity
- PEO
- Reducing HR admin in countries where you already operate
Typical cost
- EOR
- $199–$770 per employee / month
- PEO
- $50–$200 per employee / month (entity costs are on top)
Geographic scope
- EOR
- Global, 80–150+ countries
- PEO
- Mostly US (true international PEOs are rare)
Setup time
- EOR
- 1–5 business days
- PEO
- Weeks (after entity setup)
Compliance liability
- EOR
- Sits with the EOR
- PEO
- Shared with you
Benefits administration
- EOR
- Local statutory + supplemental
- PEO
- Group-rate US benefits (health, 401k)
| Dimension | EOR | PEO |
|---|---|---|
| Legal employer | EOR is the legal employer in-country | Co-employment, you remain the legal employer |
| Needs a local entity? | No | Yes (you must already have one) |
| Best for | Hiring abroad with no entity | Reducing HR admin in countries where you already operate |
| Typical cost | $199–$770 per employee / month | $50–$200 per employee / month (entity costs are on top) |
| Geographic scope | Global, 80–150+ countries | Mostly US (true international PEOs are rare) |
| Setup time | 1–5 business days | Weeks (after entity setup) |
| Compliance liability | Sits with the EOR | Shared with you |
| Benefits administration | Local statutory + supplemental | Group-rate US benefits (health, 401k) |
Quick decision rule
- • No entity in the country? You need an EOR. A PEO can't legally employ for you.
- • US entity, want cheaper benefits and HR admin? A PEO fits.
- • Hiring 15+ people in one country and already on an EOR? Run the math on opening an entity, see our EOR vs Entity calculator.
- • Comparing EOR providers? Check live EOR pricing across vendors.