How to Choose an Employer of Record: A Procurement Buyer’s Guide

Michael Shields, Vice President of Procurement at Tropic, recently published a thoughtful Buyer’s Guide to the Employer of Record (EOR) space, highlighting an important shift in how companies evaluate global hiring partners. Increasingly, EOR decisions are no longer made by HR alone — they involve procurement, finance, legal, and other stakeholders responsible for managing cost, risk, and operational performance.

As procurement teams take a closer look at the EOR category, they’re asking deeper questions about provider capabilities, compliance infrastructure, and total cost of ownership.

Shields’ article offers a valuable framework for evaluating providers and identifying where EOR platforms truly differentiate. Building on that perspective, this article expands on several of the criteria he outlines and shares additional insights and resources for organizations choosing or switching EOR partners.

PEO vs EOR — getting the terminology right

Shields' article begins by first cleaning up some of the terminology confusion. He notes that EORs and PEOs are often ‘lumped together’ despite offering very different services at different prices.

As a provider of both EOR and PEO solutions, Deel can help clarify the differences between these models so teams can determine which approach best fits their needs—or when it makes sense to use both to manage US domestic and international workforces within a single system.

Deel’s Employer of Record model is for organizations looking to bring on full-time employees anywhere in the world without opening a local entity. As Shields mentions, Deel becomes the legal employer in any given country, engaging workers through its local entities and handles all compliance obligations.

Deel owns and operates 130+ EOR entities worldwide, rather than relying on third-party partners—giving companies greater operational control, faster onboarding, and stronger compliance assurance. It has also been ranked #1 on G2 across 11 categories, including Employer of Record.

Deel’s Professional Employer Organization model is for US-based organizations looking to hire US employees while outsourcing HR, payroll, tax and benefits to Deel. As mentioned in the article, this arrangement is dependent on the company already having a US entity to enter into a co-employment relationship with Deel.

Deel’s PEO is for companies in all stages of US expansion. Whether you’re in multiple US states or expanding to the US for the first time, so you can grow faster without the costly HR overhead.

Learn more: EOR vs. PEO: Key Differences and Comparison Guide

The EOR market has changed—how buyers should evaluate providers

The EOR model is experiencing a transformative moment. What was once viewed as a niche solution for hiring a handful of remote employees abroad is now becoming a strategic workforce infrastructure for companies of all sizes and across every industry, both domestically and abroad.

Insights from Deel’s latest State of Global Hiring Report, based on data from more than one million worker contracts across 40,000+ companies, show how quickly hiring and expansion strategies are evolving. Organizations are increasingly adopting distributed hiring models to access talent wherever it exists, rather than limiting recruitment to locations where they already operate legal entities.

Companies are embracing Deel’s EOR hiring model alongside its global hiring platform capabilities as a default approach to talent acquisition and expansion. It’s no longer a temporary workaround—it’s becoming an essential way for organizations of all sizes to compete for talent and grow globally.

However, as Shields points out, not all EOR providers deliver the same capabilities. Differences in entity ownership, compliance infrastructure, payroll operations, and platform technology can significantly impact both cost and risk for buyers.

Fortunately, Shields provides a clear set of decision criteria that procurement professionals can use to evaluate EOR providers based on their organization’s risk profile.

In the sections below, we review Shields’ evaluation criteria and add further context on how companies can assess EOR providers across key operational areas—and how Deel performs against these benchmarks.

How to evaluate an Employer of Record: Expanded buying criteria

Below are 14 practical criteria procurement, HR, and finance teams can use to evaluate EOR providers, based on and expanded from Shields’ framework.

1. Entity ownership and global coverage

Shields believes procurement professionals should prioritize providers with their own local entities rather than those relying on aggregator networks of in-country partners.

Owning entities increases accountability, improves payroll and benefits administration, and reduces compliance risk. Aggregator models may introduce additional operational layers that can affect onboarding speed, support quality, and consistency across countries

Deel has the largest network with 250+ wholly-owned entities than any other provider covering 130 countries across the world.

Learn more: Owned Entity vs. In-Country Partner: Optimize Global Hiring

2. Hiring speed and onboarding timelines

Speed is the next criteria from which Shields advises decision-makers to rank providers on. The speed in which an EOR can hire talent directly impacts business velocity and candidate experience.

Deel hires employees quickly across its global entity network, with hiring timelines measured in hours rather than weeks in most markets. With the average onboarding time taking 3 - 4 days. This includes affirming work authorization, background checks, assigning correct worker classification, localizing contracts including IP and Confidentiality Agreements, as well as payroll and benefit enrollment.

Learn more: What’s the Fastest Way to Enter Markets and Hire Globally?

3. Employee experience and global benefits quality

Employee experience should also be an evaluation factor, since it plays a critical role in workforce retention and employer brand, Shields explains. A poor employee experience—such as inconsistent benefits, lack of local market understanding, or payroll inflexibility and inaccuracies—can increase turnover and damage an organization’s reputation.

Deel helps companies design and manage global benefits with expert guidance, local providers, and country-specific options. Employees can easily enroll and manage coverage in one place, while HR teams keep payroll deductions accurate, add optional benefits like travel or wellness, and track costs and adoption across countries.

In 2024, Deel paid $11.2B to workers in more than 100 currencies, while providing healthcare and benefits coverage to employees in 109 countries. The platform maintains a 90+ Net Promoter Score (NPS) among enterprise customers, reflecting consistently high satisfaction.

Deel also prioritizes financial flexibility for workers. Employees and contractors can withdraw earnings in multiple currencies, access on-demand or early pay through Anytime Pay, or move funds instantly to bank cards using Instant Card Transfer. Independent contractors can also spend earnings directly using the Deel Card, which allows them to hold and spend funds in stable currencies like USD—an especially valuable option in regions with volatile local currencies.

Learn more: 6 Ways an Employer of Record Standardizes Employee Experience

4. Payroll operations and administrative infrastructure

Next, Shields advises vetting providers on their admin requirements, or more specifically on the infrastructure that governs their ability to administer payments effectively. This is important since it impacts teams internal effort as well as cash flow and reconciliation.

Deel operates one of the largest global payroll engines, supporting payments in 120+ currencies across 130 countries and offering 15+ payment methods. In 2025 alone, Deel paid more than $22B to workers in 100 currencies, including $250M in crypto payments, while continuing to expand its native payroll technology with 55+ countries now running on Deel-built payroll engines.

Recent launches in Brazil, Canada, Malaysia, Singapore, Ireland, Saudi Arabia, and the UK—with Australia, India, and the Cayman Islands planned next—demonstrate the continued investment in building a truly global payroll and workforce infrastructure.

Learn more: One payroll engine built for real-time payroll

5. Employment compliance & legal risk governance

Next, decision-makers should evaluate whether a provider can legally employ workers on your behalf across jurisdictions without exposing your organization to labor, tax, or classification risk.

Deel addresses this through a combination of legal expertise, compliance infrastructure, and built-in safeguards. The platform includes a Worker Classifier to help determine proper employment status and reduce misclassification risk, alongside localized contract generation workflows that reflect country-specific labor laws. Employment agreements automatically incorporate IP ownership provisions, confidentiality and non-disclosure clauses, and other protections commonly required for international teams.

Beyond contract creation, Deel continuously monitors labor law updates through its Continuous Compliance software, manages tax withholding obligations, and provides termination protocols aligned with local regulations. A global network of legal counsel and compliance specialists supports incident management and regulatory oversight, helping organizations hire and manage international employees while minimizing legal exposure.

Learn more: Best Workforce Insights Software for Global Employment Law Compliance

6. Customer support and local expertise

The level of support you receive when choosing a provider is critical, Shields notes, as EOR is a high-touch service. Payroll, benefits, and localization all require fast, accurate guidance to prevent costly errors.

Deel supports customers with 2,000+ in-house experts across payroll, legal, mobility, immigration, HR, and compliance, providing guidance in dozens of languages across global markets.

With 24/7 support and an average first response time of around 100 seconds via live chat, the platform resolves 91% of issues through chat, while achieving a 93% first-contact resolution rate—well above industry benchmarks. This high level of service contributes to strong customer loyalty, with 50% of customers who churn return within 12 months, double the industry average.

Learn more: Meet Deel’s New AI Support Agent

7. Implementation process and migration planning

Whether your company is using an EOR for the first time, or transitioning from one or multiple legacy providers to another, the implementation process matters. Shields notes that poor implementation creates downstream payroll and compliance debt, whereas a clear plan avoids messy rework.

Whether your company is using an EOR for the first time or transitioning from one or multiple legacy providers, the implementation process matters. Shields notes that poor implementation can create long-term operational and compliance debt, while a structured rollout prevents costly rework and disruption.

Deel approaches implementation as a guided onboarding and migration process rather than a simple software setup. Dedicated onboarding specialists work with customers to map workflows, define responsibilities, configure approval processes, and connect Deel with existing HR, finance, and identity systems.

For organizations migrating from legacy providers or fragmented tools, Deel supports a phased transition that includes auditing current processes, importing workforce data and documents, validating records, and testing workflows before go-live. This structured approach helps companies consolidate global workforce operations into a single platform while minimizing disruption for HR teams, finance stakeholders, and employees.

Learn more: What is Global Payroll Implementation? [Expert Guide]

8. Platform capabilities, automation, and integrations

The platform itself, Shields notes, is foundational to your team's experience and capabilities. A strong, self-service platform with automations and integrations is key to reducing manual work and improving data transparency and visibility.

Deel provides an interactive platform demo and extensive developer documentation, allowing teams to explore functionality before implementation and integrate the platform into existing workflows. The platform supports role-based access controls, audit logs, and approval routing, helping organizations manage permissions, maintain compliance oversight, and create clear operational workflows across HR, finance, and legal teams.

Operational tasks are further streamlined through contract generation and workflows, document management, time-off and leave tracking, and configurable approval processes, reducing administrative overhead and ensuring consistent execution across global teams.

Deel also connects easily to the rest of the HR and finance ecosystem. The platform offers native integrations with HRIS, ATS, accounting/ERP systems, and SSO providers, as well as a comprehensive API and sandbox environment that enables companies to build custom automations, synchronize workforce data, and embed Deel into their existing tech stack.

Finally, built-in analytics and reporting tools provide real-time visibility into workforce data, payroll operations, and global hiring activity—helping stakeholders make more informed decisions while maintaining a single system of record for their distributed workforce.

Learn more: Automate Repetitive Tasks With Our Workflow Builder

9. Global workforce services beyond EOR

Employer of Record may be the entry point for many companies expanding internationally, but Shield notes that organizations increasingly need a broader set of workforce infrastructure to support hiring, mobility, compliance, and operations across markets.

Deel provides a suite of global workforce services beyond EOR, enabling companies to manage hiring, relocation, IT provisioning, equity, and entity operations from a single platform.

Immigration and global mobility

Deel Mobility helps companies hire, relocate, and move talent internationally without managing fragmented legal providers. The platform supports visa and immigration applications in 70+ countries, enabling companies to manage both long-term work permits and short-term business travel visas within the same system.

Organizations can centralize visa eligibility checks, application tracking, and compliance workflows while working with in-house immigration experts and dedicated case managers.

This makes it easier for companies to sponsor visas through Deel’s entities when they don’t have a local entity, or manage relocation and mobility programs for employees hired through their own entities.

Global HRIS and workforce management

Deel also offers a built-in HRIS that acts as a system of record for distributed teams. Companies can manage employee data, onboarding, performance, compensation, and documentation in one platform while maintaining compliance with local labor laws.

This unified approach helps HR and finance teams avoid fragmented tools while maintaining visibility into workforce operations across countries.

Global equity management

Deel also supports equity and compensation management, helping companies offer stock or equity grants to international employees and contractors while maintaining compliance with local regulations. This enables organizations to extend startup-style compensation packages globally without managing complex legal and tax frameworks across jurisdictions.

Entity setup and management

For companies ready to establish a permanent presence, Deel provides Entity Setup and Maintenance services to help organizations launch and operate legal entities in new markets. These services support incorporation, compliance management, and ongoing operational requirements, enabling companies to transition from EOR to their own entities without rebuilding their HR and payroll infrastructure.

Device lifecycle and IT management

Through Deel IT, companies can procure, deploy, secure, and retrieve laptops and equipment for distributed teams around the world. This helps organizations onboard employees quickly while maintaining standardized security policies and device management across countries.

Learn more: A Complete Guide to Global IT Asset Management for Managers

10. Pricing transparency and total cost of ownership

To fully understand pricing, decision-makers must evaluate the total cost of ownership (TCO). Shields notes that hidden costs often appear in benefits margins, payroll administration, off-cycle fees, FX spreads, indexing policies, or exit costs. Identifying these variables early helps organizations avoid unexpected budget increases as they scale internationally.

Deel addresses this with transparent, predictable pricing. Core services—including Employer of Record—have publicly available starting prices, allowing companies to evaluate costs upfront rather than relying on opaque quotes. Customers receive clear line-item visibility into platform fees versus statutory employment costs such as taxes and mandatory benefits, which vary by country but are not hidden within the service fee.

This transparency helps HR and finance teams forecast global workforce costs more accurately. Deel also provides detailed invoicing and cost modeling tools so companies can evaluate hiring strategies—such as EOR versus entity setup—before expanding into new markets.

Learn more: EOR Cost vs Direct Hire: Is It Worth It in 2026?

11. Data protection, security, and compliance standards

Payroll, identity, and employment data are highly sensitive, which is why Shields recommends evaluating providers based on the strength of their security controls, data protection practices, and auditability.

Deel operates an enterprise-grade security and compliance program designed to protect global workforce data. The platform holds SOC 2 Type II and ISO 27001 certifications, demonstrating adherence to rigorous standards across security, availability, confidentiality, processing integrity, and privacy, with SOC bridge letters available to confirm control continuity between audit periods.

From a technical perspective, Deel implements a defense-in-depth security architecture. Data is encrypted in transit and at rest, access is governed through role-based access controls and least-privilege principles, and identity management integrations such as SSO and SCIM enable centralized authentication and secure access management. Comprehensive audit logging and monitoring systems track system activity and access events to maintain full traceability.

Security is further reinforced through regular third-party penetration testing, continuous vulnerability scanning, and active threat monitoring, while all sub-processors operate under strict Data Processing Agreements and security obligations. Together, these measures help organizations securely manage payroll and employment data while maintaining compliance with global data protection standards.

Learn more: Data Privacy Compliance: Best Practices for Global Teams

12. Vendor stability and business continuity planning

The next criteria on which to evaluate providers, is on the health of the provider as a whole, since it will be the legal employer of your workforce, business continuity is essential for your employees protection and your operations.

Deel demonstrates strong financial stability and long-term business continuity, with a $17.3B valuation, over $1B raised from leading investors including Andreessen Horowitz, Coatue, and DST Global, and more than three years of EBITDA profitability. Its revenue has grown from $4M ARR in 2021 to a $1B run-rate business by 2025.

Learn more: Fastest Growing Startups of the Decade

13. Customer outcomes, references, and performance metrics

Next, stakeholders should validate their findings with real customer stories, referrals, and case studies—ideally from companies in similar markets, industries, or with comparable size and use cases.

Organizations using Deel not only accelerate global hiring but also significantly reduce operational overhead. On average, customers save 86 hours of HR administration each month, while using Deel’s EOR model instead of setting up a local entity can reduce expansion costs by around $210,000 per country.

Check out our: Deel Customer Stories

14. Change management and exit planning

Finally, Shields recommends evaluating providers on their ability to support smooth transitions—whether moving from another vendor, transitioning employees to owned entities, or fully offboarding after dissolution—since migration complexity is a major pain point for many organizations.

Deel supports these scenarios through structured migration playbooks and dedicated transition teams. Each implementation includes a single project manager, country-specific action plans, and milestone tracking to guide organizations through the process. Deel’s internal team of country-specific legal experts manages employee transfers, assesses legal and tax risks, and ensures compliance with local regulations such as TUPE and equivalent employment transfer laws.

Operationally, Deel handles key transition components including payroll migration, entity setup coordination, contract reviews, and employee onboarding, while securely migrating historical payroll data and employment documentation into the platform. Clients retain full data access and export rights, with downloadable reports and view-only access to previous systems during transition periods.

Throughout the process, dedicated Customer Success Managers, HR specialists, and Deel Legal provide oversight to ensure transitions remain compliant, minimize disruption to employees, and reduce operational risk during vendor changes or global expansion restructuring.

Learn more: Employer of Record Switch: 7 Strategies for a Successful Transition

Using a vendor scorecard to compare EOR providers

Another very practical idea in Shields’ buyer’s guide is the use of a vendor scorecard to evaluate EOR providers objectively.

Rather than relying on marketing claims or headline pricing, Shields used a structured framework to compare vendors across criteria such as employee experience, support, operational requirements, expansion capabilities, and overall cost.

This approach revealed several useful insights during the evaluation process:

• Market perception didn’t always reflect operational maturity. One vendor entered the evaluation with strong industry buzz but still had capabilities to develop
• Support mattered more than expected. When issues arise around payroll, compliance, or onboarding, response speed becomes critical
• Employee experience acted as a pass–fail category. Low scores here could create real challenges for attracting and retaining talent
• The lowest upfront price wasn’t the lowest overall cost. Once internal resources and operational complexity were factored in, the cheapest option became significantly more expensive
• Expansion potential influenced the final decision. We expand on what shields means here in our last section

Ultimately, the evaluation confirmed that continuing with Deel — the incumbent provider — best met the team’s needs after two years of using the platform.

Curious to know which provider will meet your needs best?

Deel has created a free customizable EOR vendor scorecard designed to help HR, procurement, finance, and legal teams evaluate providers using consistent criteria.

The scorecard includes a structured framework covering key areas such as:

• Compliance infrastructure and risk management
• Entity ownership and country coverage
• Payroll accuracy and operational reliability
• Employee experience, benefits, and support
• Platform usability and integrations
• Pricing transparency and total cost considerations

Unlike generic comparison checklists, the scorecard reflects the real operational factors organizations must evaluate when scaling global teams. It also includes a visual summary and spider chart that teams can use in procurement reviews, RFP documentation, or executive presentations.

Whether you’re evaluating EOR providers for the first time, expanding into new markets, or reassessing an existing partner, a structured scorecard can help ensure decisions are objective, defensible, and aligned across stakeholders.

A real-world example of the global hiring challenge

Shields’ article includes a case study that captures the operational pressure many companies face when scaling globally.

In the scenario, a recently funded company needs to hire quickly across several regions to support international customers—engineers in LATAM and Eastern Europe and customer teams in APAC. When the CEO asks the Head of People how quickly the company could expand using traditional EOR models, the answer exposes several familiar challenges:

• Hiring timelines stretching to four weeks or more
• Candidate drop-off during long onboarding cycles
• Inconsistent service levels and country-by-country surprises
• Difficulty standardizing benefits and managing FX variability
• Significant coordination across HR, finance, and legal just to keep operations running

For a company trying to hire dozens of employees across multiple countries in a matter of months, the model quickly begins to show its limits. Speed, compliance, and cost predictability all become moving targets.

The team ultimately explores a newer approach built around owned entities, centralized payroll infrastructure, and a unified platform. With this model, onboarding timelines shrink, internal administrative work drops significantly, and the company gains a clear path to scaling its global workforce.

As Shields notes, the operating model behind a provider can determine whether companies meet customer commitments—or fall behind.

This shift is also changing how organizations think about EOR itself. What once solved the challenge of hiring abroad without opening entities is evolving into something broader: global workforce infrastructure.

Platforms like Deel now extend far beyond traditional EOR services, combining global payroll, contractor management, HR tools, US PEO services, and compliance infrastructure across more than 150 countries. Instead of stitching together multiple vendors, companies can manage global hiring and workforce operations in one system.

In other words, while EOR may be the entry point, the bigger opportunity is enabling companies to expand and operate globally with confidence.

In the final section, we explore how this shift positions Deel not simply as an EOR provider, but as a global expansion enabler for modern companies.

EOR is only the starting point

Toward the end of his article, Shields reflects on something that initially surprised him during a business review with Deel. What he had long thought of as an “EOR provider” was clearly expanding into something much broader.

At first, the idea raised questions. Why would an EOR company start building capabilities around areas like identity management, IT provisioning, device lifecycle management, or domestic payroll infrastructure?

But as Shields describes, the reasoning quickly becomes clear when you look at the operational reality of global hiring.

Hiring internationally doesn’t stop at employment contracts. Once a company hires talent in another country, it still has to solve dozens of operational challenges: delivering equipment, setting up system access, ensuring payroll runs accurately across currencies, managing compliance, and eventually handling offboarding and asset recovery when employees leave.

For many companies, these steps require coordinating multiple vendors across HR, IT, finance, and legal—creating friction, cost, and risk along the way.

This is where the idea of a unified global workforce platform begins to make sense.

Beyond EOR: The rise of Deel’s global workforce platform

Instead of treating hiring, payroll, equipment provisioning, compliance, and workforce management as separate problems, Deel approaches them as part of a single operational lifecycle: helping companies hire, manage, and scale teams anywhere in the world.

Today, Deel supports a workforce of more than 7,000 team members across 110 countries, spanning 28 time zones and speaking 70+ languages. Building and managing its own global team has given the company a firsthand view of the challenges organizations face when operating internationally.

Many of the capabilities now available on the platform—from global payroll and contractor management to immigration support, device lifecycle services, and US PEO—have grown out of that experience.

The goal isn’t simply to offer more services. It’s to build lasting infrastructure that enables companies to expand globally with confidence, regardless of their size, location, or stage of growth.

As Shields suggests, this broader approach may also help organizations simplify their vendor landscape. In a world where supplier rationalization and operational efficiency are top priorities, consolidating global workforce operations into a single platform can reduce complexity while improving the employee experience.

And as the market continues to evolve, one thing is becoming increasingly clear: the future of this category may not be defined by traditional EOR providers at all, but by a provider like Deel that enables companies to hire, operate, and grow globally from day one.

Today, 40,000+ companies use Deel to support more than 1.5 million workers worldwide, including organizations such as Shopify, Coinbase, Reddit, Klarna, Adyen, Instacart, and BBC Studios.

Deel’s leadership in global workforce infrastructure has earned recognition including Top 10 on the Forbes Cloud 100, #1 rankings across 11 G2 categories, Deloitte Fast 500 recognition, CNBC Disruptor 50 inclusion, and 4.8+ customer ratings across G2, Trustpilot, and Glassdoor.

Ready to see how Deel can support your global hiring and expansion strategy? Book a demo to explore how the platform can help you hire, pay, and manage teams anywhere in the world.