Document 08 of 10

Paying Your Global Team

Get payroll right: EOR versus contractor, payment terms, and local nuances.

Getting payroll wrong is one of the fastest ways to lose a good hire. Late or unpredictable pay creates anxiety, erodes trust, and in some countries creates real legal exposure. Getting it right is not complicated, but it does require a decision made on purpose rather than by default.

You have two real options: employ the person through an Employer of Record, or pay them directly as a contractor. This document explains the difference, gives you a decision tree, and covers the local details that trip people up.

Type

System

Stakes

High

Decision

EOR or contractor

Next doc

Accountability & Risk

Section 00

EOR vs Contractor

This is operational guidance, not legal or tax advice. Worker-classification rules vary by country and change often. Confirm your specific situation with a qualified local advisor before you commit.

Before you pick a method, understand what you are actually choosing between.

	Employer of Record	Direct contractor
Who employs them	The EOR platform, legally, in their country	You, by agreement, or nobody formally
Taxes and compliance	Handled by the EOR	The worker is responsible
Compliant contract	Provided by the EOR	You write your own
Misclassification risk	Carried by the EOR	Carried by you
Typical cost	A per-employee monthly fee on top of salary	Just the transfer fee
Best for	Full-time, long-term, exclusive hires	True independent contractors and short projects

Section 01

The Payment Method Decision Tree

Five questions decide it. Work them top to bottom.

Is this person full-time, exclusive, and following your schedule?

No: pay them as a contractor, since they control their own methods. Yes: keep going.

Will they work for you longer than six months?

No: a contractor arrangement may fit, but check with legal counsel. Yes: lean toward an EOR.

Does their country have strict employment laws?

Yes, for example much of the EU and parts of Latin America: use an EOR. No: a contractor arrangement may fit, but verify locally.

Do you need to provide benefits or statutory pay, like a 13th month?

Yes: use an EOR so it is handled correctly. No: a contractor arrangement may fit.

What is your tolerance for misclassification risk?

Low, you want full compliance: use an EOR. Higher: a contractor arrangement with a strong written agreement.

For the full-time CSR, Sales, and Ops roles this playbook is built around, use an EOR. The compliance protection is worth the fee. Reserve direct payment for genuine short-term projects and independent contractors.

Section 02

EOR Platforms

An EOR legally employs your worker in their home country and handles payroll, tax withholding, social contributions, benefits, statutory payments, and a compliant contract. You pay the platform, they pay the person. Common platforms include Deel, Remote, Oyster, and G-P (Globalization Partners).

Strengths

Full compliance with local labour law
Handles tax withholding and social contributions
Administers benefits and statutory pay
Shifts misclassification risk off you
Onboards a new country in days

Trade-offs

A per-employee monthly fee, commonly a few hundred dollars
Can feel steep for a very small team
Less control over exact contract terms

Typical fee

A few hundred / mo

A per-employee monthly fee on top of salary. The exact amount varies by provider and country.

Time to first pay

5 to 10 days

From signed contract to the first compliant payment.

Compliance risk

Minimal

The EOR assumes the employment and classification risk.

Cost example: a CSR in the Philippines on a 1,200 dollar monthly salary, plus a roughly 400 dollar EOR fee, lands near 1,600 dollars a month, all-in and fully compliant. Your real numbers depend on the provider and the country.

Section 03

Direct Payment

Wise (formerly TransferWise) is a direct payment service, not a payroll provider. It is excellent at fast, low-cost international transfers at the real mid-market exchange rate. It does not handle compliance, withhold taxes, or provide an employment contract, so all of that responsibility stays with you.

Strengths

Low transfer fees, typically 0.5 to 2 percent
The real mid-market exchange rate
Fast transfers, often same day
Simple, with no monthly subscription

Trade-offs

Does not handle payroll compliance
Does not withhold taxes
No employment contract
You carry all classification risk
Not suitable for an employment relationship

Use direct payment for genuine independent contractors, short-term projects, one-off payments, and workers who run their own business entity. If the relationship looks and behaves like employment, use an EOR instead.

Section 04

Payment Frequency

Pick a payment frequency and never move it. Consistency is what builds trust; the exact cadence matters less than its reliability.

Frequency	Pace	Best for	Watch-out
Weekly	52 a year	Hourly workers, short-term contractors	Heavy admin load and more transaction fees
Bi-weekly	26 a year	US-based and hourly teams that expect it	Still 26 runs a year to process
Monthly	12 a year	Salaried global employees	Long gap between pays, so pay on time, every time

Recommendation: pay monthly for salaried global employees. It is the international standard, minimises overhead, and is the default on most EOR platforms. Whatever you choose, keep it fixed.

Section 05

Compensation and Local Nuances

Price roles to global bands, not local minimums, then respect local norms on top. A few examples that catch people out:

Philippines

13th month pay

A legally required benefit under Presidential Decree 851. Rank-and-file employees who worked at least a month in the year receive one-twelfth of their total basic annual salary, paid by 24 December. An EOR handles it automatically.

Latin America

Extended PTO

Generous paid time off is the norm, often 15 to 20 days. Offer a policy that meets or beats the local standard.

Eastern Europe

Equipment stipends

A hardware stipend can matter more than elsewhere. A generous stipend or a full equipment package signals you are serious.

The principle across all of them: research the local norm, price to a global band, and be transparent with the hire about how their package is built. Where a statutory benefit applies, an EOR is the safest way to stay compliant. If you pay direct, the responsibility for getting it right is yours.

Rhythms & Standards

Accountability & Risk→