The Real Difference Between PEO and EOR — And When Each Makes Sense (Herensys Guide)

For founders, CFO/COO, and HR leaders planning global hiring and fast market entry.

PEO (Professional Employer Organization)
- You already have a local entity; the PEO co-employs your staff.
- The PEO runs payroll, benefits, and HR administration; your entity remains exposed to local employer obligations.
- Best for established operations and larger, stable headcount within one jurisdiction.
EOR (Employer of Record)
- The provider becomes the legal employer in-country on your behalf.
- No local entity required; you manage the work, we handle compliant employment.
- Best for rapid market entry, small pods across many countries, and contractor-to-employee conversions.

Quick Comparison

Dimension	PEO	EOR
Legal employer	You (co-employment with PEO admin)	EOR provider
Entity required	Yes	No
Time-to-hire	Depends on entity readiness	Typically 1–4 weeks
Geographic scope	Usually single-country	Multi-country, distributed pods
Compliance exposure	Shared; your entity retains risk	Primarily on EOR as legal employer
Cost profile	Lower per-employee + high fixed entity costs	Higher per-employee + minimal fixed costs
Best for	Established presence, 20–50+ headcount	Market tests, fast entry, contractor conversions

Choose PEO if:
- You already operate in-country and plan to scale to 20–50+ employees.
- You want pooled benefits and HR admin within your own entity.
- Your licensing/sales model requires your entity to be the employer.
Choose EOR if:
- You need to hire now in a country without an entity.
- You’re building small teams across multiple countries (1–15 per country).
- You’re converting contractors to mitigate misclassification risk.
- You want a reversible path: start with EOR, migrate to your entity later.

Herensys combines EOR with integrated recruitment and BPO so your market entry is revenue-ready:

EOR
- Localized employment contracts, payroll, taxes, mandatory benefits, compliant offboarding.
- Country-specific IP/confidentiality addenda and policy alignment.
Recruitment
- Sourcing to offer in one coordinated flow with EOR paperwork and onboarding.
- Cuts time from “offer accepted” to “day one.”
BPO (optional)
- Stand up support and back-office processes alongside your first hires.
- Scale operations without sacrificing quality.

Planning expansion or testing a new market?Let’s map your hiring, compliance, and cost options across countries in one structured session.