Learn about global payroll
Everything you need to understand global payroll, EOR services, and international employment. From basic terminology to in-depth guides.
Payroll glossary
Key terms and definitions to help you navigate the global payroll landscape.
Employment models
Global payroll
A centralized system for managing employee compensation across multiple countries, handling currency conversions, tax compliance, and local regulations.
Employer of record (EOR)
A third-party organization that becomes the legal employer of workers in countries where a company doesn't have a legal entity, handling employment contracts, payroll, and compliance.
Professional employer organization (PEO)
A co-employment arrangement where the PEO shares employer responsibilities with the client company, typically used for domestic employees.
Contractor management
The process of onboarding, paying, and managing relationships with independent contractors, including compliance with local classification laws.
Payroll compliance
Adherence to local, national, and international laws governing employee compensation, including tax withholding, benefits, and reporting requirements.
Multi-country payroll
Payroll processing for employees located in multiple countries, often consolidated through a single platform or provider.
Statutory benefits
Mandatory employee benefits required by law in a specific country, such as health insurance, pension contributions, or paid leave.
Payroll consolidation
The process of unifying payroll operations across multiple countries or entities into a single, streamlined system.
Worker classification
The legal distinction between employees and independent contractors, which determines tax obligations, benefits eligibility, and labor law protections.
Gross-to-net calculation
The process of calculating an employee's take-home pay by subtracting taxes, deductions, and contributions from their gross salary.
Permanent establishment
A fixed place of business that may create tax obligations for a company in a foreign country, often a concern when hiring internationally.
Common questions
Quick answers to frequently asked questions about global payroll.
What's the difference between EOR and PEO?
An EOR becomes the full legal employer of your workers in countries where you don't have an entity. A PEO is a co-employment arrangement where you share employer responsibilities, typically used when you already have a legal entity in the country.
How much does global payroll cost?
Global payroll costs vary widely depending on the provider, number of countries, and employees. Expect to pay $20-$50 per employee per month for basic payroll processing, while EOR services typically cost $299-$699 per employee per month.
Do I need an EOR or can I use global payroll?
If you have legal entities in the countries where you're hiring, you can use global payroll. If you want to hire in countries without setting up a local entity, you'll need an EOR to act as the legal employer.
How long does it take to set up global payroll?
Implementation timelines vary by provider and complexity. Simple setups can be completed in 2-4 weeks, while enterprise implementations across multiple countries may take 2-3 months.
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Social contributions
Mandatory payments made by employers and/or employees to fund social security programs, including pension, healthcare, and unemployment insurance.