The Employer of Record (EOR) model is known for making international hiring super easy for growing organisations. But how does it work?

Here’s a high-level, step-by-step guide to employing people overseas.

Identify Candidates & issue contracts

First, your company identifies and selects the right candidate(s) for the role(s), wherever they are in the world. They may already be part of your team, or they may be new hires. The EOR then steps in as the legal employer in that country, issuing locally compliant employment contracts that reflect national labour law and norms on pay, benefits, probation, statutory leave, and mandatory clauses. The EOR can also advise on market-appropriate salaries and benefits in that specific country to keep you both competitive and compliant.

onboarding & Payroll setup

Next, the EOR manages cross‑border onboarding – registering the employee(s) for payroll, tax, and social security in their country of residence. Payroll setup, including salary disbursement in local currency, tax withholdings, mandatory contributions, and statutory reporting, is handled every pay cycle by the EOR, typically via an online platform where you can view country-by-country costs, approve changes, and access documentation. You will receive an invoice each month from the EOR, detailing all salary and mandatory contribution details for your team – you also have the opportunity to pay variables such as commissions and bonuses, as well as expenses.

ongoing compliance monitoring

Throughout the employment, the EOR monitors legal changes in each jurisdiction where you have team members. If regulations shift, for example around holiday entitlements, health benefits, notice periods, or minimum wage in a specific country, the EOR updates contracts, policies, and processes accordingly and explains the business impact. The EOR also manages required filings and communication with local authorities, so you do not need to navigate foreign administrative systems.

who does what?

It’s important to remember that you retain day-to-day supervision of each employee globally, e.g. setting objectives, managing work, integrating them into your culture, and supporting their development. The international EOR’s role is to absorb the local “employer” risk and handle all in‑country employment obligations in the background. If a dispute, grievance, or termination arises in any location, the EOR advises on locally compliant options, manages formal steps, and ensures the process is fair and lawful under that country’s rules. With Peak, this includes direct access to a knowledgeable team who can guide you through sensitive situations, coach managers, and help maintain a positive experience for your globally distributed workforce.

In practice, using an EOR gives you the benefits of having a compliant local employer structure in every country where your talent lives, without the cost, delay, or complexity of setting up foreign entities or stitching together multiple local providers. International EOR turns complex cross‑border employment into a simple, scalable, and supportive way to build truly global teams, with experts alongside you and your people at every step.

At Peak, we handle all of the above, and our service is backed by a team of friendly, experienced international employment specialists who are on hand to answer queries, sense-check decisions, and support both you and your people throughout the employee lifecycle.