EOR vs staffing agency: who employs the worker, and what each costs

The main difference: who finds the worker

A staffing agency finds the workers, employs them and supplies them to you. An employer of record (EOR) employs a person whom you found and chose. In both cases, the provider is the legal employer, and the person works for you.

Sources: US Census Bureau, NAICS 2022, 561320 Temporary Help Services, GOV.UK, Employment agencies and businesses, GOV.UK, Fees to hiring companies (transfer fees), Boundless pricing, Oyster pricing, European Central BankChecked 7 Oct 2026

The law can treat an EOR like an agency

An EOR is the legal employer, but the person works for you and follows your instructions. In many countries, that is the same set-up as agency work. So the rules for staffing agencies can apply to an EOR too, such as a licence or a time limit for each worker.

Germany

An EOR arrangement can count as temporary agency work. The EOR, or its partner, then needs a licence under the AÜG, and a time limit applies to each worker.Temporary Agency Work Act (AÜG), section 1, Temporary Agency Work Act (AÜG), section 8Checked 1 Oct 2026

United Kingdom

The Agency Workers Regulations 2010 can apply. Then the worker gets the same basic conditions as a direct recruit after a qualifying period.Agency Workers Regulations 2010, regulation 3, Agency Workers Regulations 2010, regulation 5, Agency Workers Regulations 2010, regulation 7, Conduct Regulations 2003: guidance, Licences for employment agenciesChecked 1 Oct 2026

Netherlands

Dutch law treats payrolling as a form of the supply of workers. The supplier must register, and from 2028 it needs an admission.Waadi (Placement of Personnel by Intermediaries Act), articles 1, 7a and 8a, Business.gov.nl, registering a foreign company, Staatsblad 2026, 159, the start of the Wtta, Staatsblad 2025, 385, the Wtta, Business.gov.nl, suppliers of personnel must be authorised, NAU, do you need an admissionChecked 2 Oct 2026

Ask each EOR how it meets these rules in the country of your hire. See the rules in each of our countries.

Employee leasing, staff leasing and PEOs in the US

The US industry classification (NAICS) puts staffing agencies and PEOs in different industries:

Temporary help services

Supply workers to a client for limited periods, to add to the client's workforce. The workers are employees of the temporary help firm.US Census Bureau, NAICS 2022, 561320 Temporary Help ServicesChecked 7 Oct 2026

Professional employer organisations (PEOs)

Work in a co-employment relationship with the client. They run the payroll and the payroll tax, and serve as the employer for benefits and related purposes. Employee leasing and staff leasing services are in this industry.US Census Bureau, NAICS 2022, 561330 Professional Employer OrganizationsChecked 7 Oct 2026

So in the US, "employee leasing" usually means a PEO, not a staffing agency. A PEO works with your own US company. NAICS does not name employers of record. Read the difference between an EOR and a PEO.

Agencies and employment businesses in the UK

UK law uses two terms:

Employment agency

Finds work for people, who are then employed and paid by the hiring company.GOV.UK, Employment agencies and businessesChecked 7 Oct 2026

Employment business

Engages a person who then works under the supervision of someone else. The business pays the worker, not the company that it supplies the worker to.GOV.UK, Employment agencies and businessesChecked 7 Oct 2026

Transfer fees

An employment business can charge a fee when you give its worker a permanent job less than 8 weeks after the end of the first assignment, or less than 14 weeks after it started if that is later. It can do so only if the contract gave you the choice to extend the assignment instead, and you did not take it.GOV.UK, Fees to hiring companies (transfer fees)Checked 7 Oct 2026

An EOR in the UK is closer to an employment business: it pays the person, who works under your supervision.

Offshore staffing and staff augmentation

"Offshore staffing", "offshore staff leasing" and "staff augmentation" are sales terms, not legal terms. Each provider uses them in its own way. Ask the same three questions as for any provider:

• Who finds and chooses the person: the provider or you?
• Who signs the employment contract in the country?
• Who directs the daily work?

If the provider employs the person and you direct the work, the local rules for agency work or the supply of workers can apply. In the Philippines, for example, the rules on labour-only contracting can make the client responsible to the workers. Read the job contracting rules in the Philippines.

What each one costs

An EOR publishes a fee for each employee. In our 10 countries, the published fees are US$197 to US$796 a month for each employee.

With either option, the employer costs that the law requires come on top of the salary: 4.0% of the gross salary in India to 50.9% in Brazil. Compare the all-in cost in every country.

Ask a staffing agency for the pay rate and the charge rate. The difference covers the employer costs and the agency's margin.

Both can charge other fees. An agency can charge a transfer fee when you hire its worker, and some EORs charge exit fees. Read about the hidden costs of an EOR.

Sources: Boundless pricing, Oyster pricing, European Central Bank, GOV.UK, Fees to hiring companies (transfer fees)Checked 7 Oct 2026

Which one fits

• A staffing agency fits when you need the provider to find people, often for a short period or a peak in work.
• An EOR fits when you already chose the person and want to employ them for a longer time, in a country where you have no company.
• Your own company fits when you hire many people in one country for the long term.

Staff abroad can also create a taxable presence for your company, whoever employs them. Read about permanent establishment.