20 Best Employer of Record in Portugal: Reviewed in 2024
Best Portuguese Employer of Record Service Shortlist
Here’s my pick of the 10 best Portugal EOR companies out of the 20 options I’ve reviewed:
Get free help from our HR software advisors to find your match.
Are you interested in tapping into Portugal’s talent pool but feeling intimidated by all the legal requirements? Instead of registering a new legal entity with the Portuguese Commercial Registry (Registro Comercial) and the Portuguese Tax Authority (Autoridade Tributária e Aduaneira), I recommend using an Employer of Record (EOR) service in Portugal to manage all the employment regulations on your behalf.
A Portugal EOR service can help you legally hire, manage, and pay employees based in Portugal with ease. This way, you can access Portuguese talent without having to open a legal entity abroad. Your EOR employees will have local support, and your operations will stay in compliance with Portugal’s Authority for Working Conditions (ACT) at all times. Sounds perfect, right? However, which Portugal EOR service is the best fit for your needs?
To help you narrow down your options, I’ve compiled my research into this list of the best Employer of Record services for hiring in Portugal.
Market Details for Hiring In Portugal
- Capital City: Lisbon
- Currency: Euro (EUR, €)
- Payroll Frequency: Monthly
- Official Language: Portuguese
- Approx. Population: 10.2 Million
- Public Holidays: 13 days
Why Hire Employees in Portugal?
Portugal is a prime destination for companies looking to hire top talent abroad due to its deep talent marketplace in the technology and creative sectors, including a wealth of professionals in IT, software development, engineering, and digital marketing.
The educational system in Portugal is excellent, producing graduates with expertise in data science, AI, web development, and customer service, making it a hub for tech startups and innovation. In addition, Portugal's competitive labor costs and high levels of English proficiency among its workforce make Portugal an attractive market for employing international talent.
What is an Employer of Record in Portugal?
An Employer of Record (EOR) in Portugal refers to a third-party service that legally employs workers in Portugal on behalf of your company. While your organization retains control over these employees’ daily tasks and workloads, the EOR takes on the full legal responsibility for employment. As the legal employer, the EOR assumes full legal responsibility for any new hires. This includes managing payroll, deducting taxes, ensuring compliance with local employment regulations, administering benefits, and handling any other employee-related requirements specific to Portugal.
Partnering with an EOR service is beneficial for companies wanting to hire skilled foreign workers or expand their operations into Portugal since it simplifies this process considerably. Instead of requiring your HR team to master Portugal’s employment laws and regulations, you can delegate these responsibilities to a local EOR in Portugal and gain peace of mind that your global operations will be compliant.
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Best Employer of Record in Portugal: Pricing Comparison Chart
This comparison chart summarizes pricing details for my top Employer of Record selections for hiring staff in Portugal to help you find the best EOR service for your budget and business needs.
| Tools | Price | |
|---|---|---|
| Deel | Flat rate user pricing, with a free version for businesses with up to 200 people | Website |
| Oyster HR | From $599/employee/month or $29/contractor/month | Website |
| Atlas HXM | From $595/employee/month or $49/contractor/month | Website |
| Globalization Partners | Pricing upon request | Website |
| Mercans | Pricing upon request | Website |
| Velocity Global | Pricing upon request | Website |
| Horizons | Pricing upon request | Website |
| Remote | From $50/user/month | Website |
| Multiplier | From $20/user/month (billed annually) | Website |
| Papaya Global | From $15/employee/month | Website |
Compare Software Specs Side by Side
Use our comparison chart to review and evaluate software specs side-by-side.
Compare SoftwareHow to Choose an Employer of Record in Portugal
An EOR service can solve many different challenges and simplify the process of hiring and managing staff in Portugal. To help you figure out which EOR service best fits your business needs, you need to document your specific challenges first.
As you work through your own unique selection process, keep the following points in mind:
- What problem are you trying to solve? Start by identifying the challenges you're trying to overcome, whether that's sourcing staff within a specific Portuguese district, managing compliance with Portugal’s employment laws and tax regulations, paying employees in Euros, or offering health benefits to your employees in Portugal.
- Who will benefit from the service? Consider who will manage the EOR relationship (i.e., who will your main contact people be in-house?) and how having an employer of record will improve their day-to-day work tasks.
- What is your budget? To evaluate cost, estimate how many employees you anticipate hiring in Portugal. Since EOR providers typically charge a monthly fee for each new hire, this will help you anticipate your monthly costs.
- What outcomes are important? Review the capabilities you want to gain or improve, and how you will measure success. For example, you may want to hire employees in Portugal within a certain district to help your company tap into a new customer base abroad. You could compare service providers until you’re blue in the face but if you aren’t thinking about the outcomes you want to achieve, you could waste a lot of valuable time.
- Would the EOR platform work with your technical requirements? Consider how the service provider's software ecosystem would work alongside your existing workflows and systems. Does their software framework integrate with your existing HR software, or would you face data management roadblocks?
Remember every business is different — don’t assume that a Portuguese employer of record service will work for your organization just because it's popular.
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Deel
Visit WebsiteThis is an aggregated rating for this tool including ratings from Crozdesk users and ratings from other sites.4.8 -
Rippling
Visit WebsiteThis is an aggregated rating for this tool including ratings from Crozdesk users and ratings from other sites.4.8 -
ClearCompany
Visit WebsiteThis is an aggregated rating for this tool including ratings from Crozdesk users and ratings from other sites.4.6
Reviews of the Best Employer of Record Services in Portugal
To help you find the best EOR service for hiring employees in Portugal, I’ve described my top 10 selections in detail, including the specific services each provider offers and how HR teams can use them effectively. Additionally, I’ve listed 10 more EOR service providers for Portugal below if you’d like more options to consider.
Deel
Best for offering local health benefits to Portuguese EOR employees
Deel is a well-established employer of record platform that helps companies rapidly employ workers in 150+ countries, including Portugal.
Deel owns a local entity in Portugal staffed with legal experts to keep track of regulatory changes and ensure all legal obligations are met on your behalf. To hire an employee in Portugal with Deel, the average onboarding time frame is 3 days.
Why I picked Deel: Deel excels as an EOR service provider in Portugal by offering streamlined contract management, ensuring compliance with Portuguese employment laws. Deel also helps organizations offer localized employee benefits for Portuguese staff, including private health insurance, a compensation fund, labor accident insurance, employee training, and social security contributions.
In addition, Deel has launched several new offerings over the past year, including global payroll, global mobility support, integrated Slack tools, and advanced integrations. These services, all combined, facilitate efficient and compliant hiring processes within the Portuguese talent market.
Deel Key Services:
Deel offers end-to-end management for your employees based in Portugal, covering everything from hiring and onboarding to termination. Their web app is user-friendly and provides a range of features to help businesses manage their remote teams effectively, including contract management and expense tracking.
Their integrated contract management function supports advanced customizations such as stipends, signing bonuses, and stock options. You can also use Deel for visa and immigration support if you want to relocate existing employees to Portugal, with Deel managing the entire visa process for your organization in-house.
Deel offers 24/7 customer support and live chat and is known for its fast support.
Pros and cons
Pros:
- Comprehensive employee benefits
- Local compliance expertise
- Fast onboarding process
Cons:
- Potential complexity for first-time users
- Limited customization options
Oyster HR is a global EOR service provider that helps businesses hire employees in Portugal and other countries with full compliance. Their platform is designed to support seamless global expansion with a focus on compliance and employee experience.
Why I picked Oyster HR: Oyster offers educational resources to their EOR clients to help them navigate the global employment landscape. This includes useful financial tools that help you determine the full cost of hiring a new employee in any country, or whether it would be more cost-effective to fill a position with an international contractor rather than an employee.
In addition, the Oyster Academy is a helpful resource for companies that are new to the international work-from-anywhere scene, and includes training courses on ‘how to prepare for distributed work,’ and ‘how to create a company culture in a distributed environment.’
Oyster HR Key Services:
Oyster HR offers a range of features, including streamlined onboarding, payroll, and benefits management, tailored specifically for the Portuguese market. Their platform stands out for its ease of use, compliance assurance, and dedicated support, making it an ideal choice for businesses looking to expand in Portugal.
Their onboarding process is designed to be quick and efficient, helping new hires integrate into their roles smoothly. This feature includes digital contract management and automated document collection, making the entire process hassle-free for both employers and employees.
Pros and cons
Pros:
- Efficient onboarding process
- Strong compliance support
- Comprehensive global benefits packages
Cons:
- Onboarding time for new hires varies
- Limited customization options
Atlas HXM offers innovative companies the tools they need to compete in a global economy. As one of the largest, direct EOR service providers, Atlas HXM believes businesses should be able to employ whomever they want, wherever the talent exists.
Why I picked Atlas HXM: They're a popular choice across numerous industries, including non-profits, financial services, oil & gas, energy, life sciences, pharmaceuticals, technology, and government, and they can tailor their service offerings to your needs, whether you're a new startup, an SME, or an enterprise organization.
Atlas is committed to widening the margins of entrepreneurship and employment alike. As such, their business model helps startups and SMBs compete on the international playing field—turning commercial innovations into viable global enterprises. In doing so, Atlas brings opportunities to local economies and the people who work there.
Atlas HXM Key Services:
Services include Portuguese-specific compliance monitoring, employee engagement and productivity monitoring, and guidance on safety programs to minimize business risks.
Their technology platform is supported by international experts who deliver flexible services to companies wanting to expand across borders, including into Europe. Their services can help you onboard talent, manage compliance, and pay your global workforce without requiring a local entity or multiple third-party providers.
Pros and cons
Pros:
- User-friendly platform with localized support
- Comprehensive and customized onboarding
- Extensive local compliance expertise
Cons:
- Initial setup may require significant time and resources
- Limited customization options for specific HR policies
Globalization Partners (or G-P) is a leading EOR service provider that assists companies looking to hire and manage employees in Portugal. Their global HR platform streamlines international hiring, compliance, payroll, and benefits administration, ensuring a smooth onboarding process for Portuguese employees.
Why I picked Globalization Partners: G-P’s sophisticated global EOR platform is designed to handle complex regulatory environments, making it easy for businesses to hire and manage employees in numerous countries, including Portugal.
New hires can be onboarded in days, with locally-compliant contracts according to Portuguese laws. Using G-P, you can also pay your EOR employees in over 180+ currencies (including cryptocurrencies) using Venmo or bank transfers.
Globalization Partners Key Services:
G-P offers automated onboarding processes, real-time expense reporting, and a dedicated support team, all of which contribute to its reputation as one of the best EOR services in Portugal.
Their team includes local HR experts who understand the intricacies of Portuguese labor laws and cultural nuances and can also assist with global expansion plans and executing global transactions as needed.
Pros and cons
Pros:
- Easy and quick international hiring and onboarding process
- Strong compliance and risk management
- Comprehensive global employment platform
Cons:
- Dependence on the platform for all HR functions
- Limited customization options
Mercans is a global EOR provider that offers services in Portugal, including global payroll and other HR solutions. Their services emphasize compliance, local expertise, and seamless integration for businesses expanding into the European market.
Why I picked Mercans: EOR services via Mercans include compliance management and extensive local knowledge, a commitment to personalized service, and access to an advanced technology platform to streamline payroll and HR processes. They stand out for their ability to handle complex employment scenarios, making them a top choice for companies seeking reliable EOR services in Portugal.
Mercans Key Services:
Mercans provides tailored HR solutions to support the diverse needs of each client. This customization ensures that businesses receive support aligned with their unique requirements, enhancing overall employee satisfaction.
Mercans also runs its EOR services from an advanced technology platform that includes real-time reporting and analytics features, giving client companies valuable insights into their global HR operations. This level of data also helps client companies make informed decisions and improve strategic planning.
Pros and cons
Pros:
- Extensive local expertise
- Personalized service
- Advanced technology platform
Cons:
- Integration challenges with some existing systems
- Limited physical presence in some regions
Velocity Global is a well-known employer of record (EOR) and professional employer organization (PEO) provider that simplifies global hiring thanks to its network of on-the-ground experts in 185+ countries, including Portugal.
Why I picked Velocity Global: I included Velocity Global in this list because of their well-known reputation for global EOR services and their expertise in navigating complex regulatory environments. They stand out with their ability to handle intricate regulatory landscapes, ensuring companies can expand efficiently without legal hurdles.
Velocity Global Key Services:
Velocity Global offers comprehensive support for their EOR clients, including everything from onboarding to ongoing HR management, backed by a deep understanding of local employment laws. Key services include payroll, compliance, benefits management, employee training, and risk management for your Portuguese employee operations.
In addition to its EOR services, Velocity Global can also help you simplify your plans for global expansion or offer additional global immigration services in case you want to move international employees to another location.
Pros and cons
Pros:
- Strong understanding of the Portuguese regulatory environment
- Localized payroll management
- Efficient and thorough onboarding process
Cons:
- Pricing details are not transparent
- Limited customization options
Horizons offers streamlined global HR solutions including EOR and PEO services, international payroll and recruitment, and global mobility & immigration support.
Why I picked Horizons: I included Horizons in this list because their EOR service is cost-effective compared to others, and they offer flexible contract terms. You can end your EOR relationship with them at any time without worrying about costly termination fees or other penalties.
Their Portugal-based EOR services are administered by their local experts who are well-versed in Portugal’s employment laws, including statutory benefits such as vacation leave, maternity leave and paternity leave. Their onboarding process for new employees in Portugal is also very quick, with a minimum onboarding time of just 12 hours.
Horizons Key Services:
In addition to their standard EOR services, they offer additional niche service offerings such as tips for doing business in Portugal, guides to help with global expansion, resources for strategic mergers & acquisitions, and advice on accessing new and emerging markets.
Horizons also provides cultural training and support to help employees integrate seamlessly into their new work environment. This service enhances employee satisfaction and retention by addressing cultural nuances and fostering a positive workplace culture.
Pros and cons
Pros:
- Cultural integration support
- Strong focus on compliance
- Deep knowledge of Portugal labor laws
Cons:
- Service offerings may vary by region
- Dependence on local partners for some services
Remote’s global HR solution offers EOR services that simplify payroll, benefits, taxes, and compliance for international workers. You can use their services to hire full-time employees or contractors and gain local market insights.
Once you’re ready to hire an employee in Portugal, Remote can complete their onboarding process within 2 days.
Why I picked Remote: Remote helps companies compete for talent effectively in the global market by lending access to competitive benefits packages. They can help you offer health insurance, dental insurance, vision insurance, disability and life insurance, and mental health support services for your Portuguese employees. Remote also doesn’t add any markup to their benefits premiums or administration costs, making them a cost-effective choice.
Remote Key Services:
Services include global payroll processing, intellectual property and invention rights protection, and benefits packages that are tailored for the Portuguese market. Their software platform also covers experience reimbursement and time-off requests, which are quick and easy to approve through their online portal.
Pros and cons
Pros:
- Strong local expertise
- User-friendly platform
- Comprehensive compliance support
Cons:
- High cost per employee
- Limited customization options
Multiplier is an employer of record company that provides HR and global payroll services to businesses, allowing them to outsource these responsibilities to a single provider. You can use their services to hire and manage employees based in Portugal and comply with changing labor laws and tax policies.
Why I picked Multiplier: Multiplier helps businesses quickly and easily onboard new employees, manage their payroll and benefits, and ensure compliance with local laws and regulations. Their EOR services are very fast, with the ability to employ new talent in some countries in less than 24 hours once you've decided which candidate you'd like to hire. Their 4-step onboarding process is also user-friendly, providing a good experience for your new employees.
Multiplier Key Services:
Their EOR services include payroll processing, tax compliance, benefits administration, and worker's compensation. Their team of local experts can also offer support with employee benefits management, including health insurance, retirement plans, and other perks that are specifically tailored to the Portuguese market. This service helps attract and retain top talent by offering competitive benefits packages.
By outsourcing your core HR responsibilities to Multiplier, you can reduce your exposure to the legal and financial risks associated with employing workers in Portugal.
Pros and cons
Pros:
- Excellent customer service
- User-friendly platform
- Comprehensive compliance support
Cons:
- Dependence on third-party benefits providers
- Limited customization options
Papaya Global is a leading Employer of Record (EOR) service provider with a presence in Portugal. Their platform simplifies the complexities of global payroll, hiring, and compliance, allowing businesses to manage their international workforce efficiently. They offer tailored services for the Portuguese market, ensuring compliance with local regulations and employment laws.
Why I picked Papaya Global: I included Papaya Global in this list because their platform integrates payroll, HR, and compliance into a single, easy-to-use interface, making it simple for businesses to manage their international employees. Additionally, their focus on local compliance ensures that businesses can operate in Portugal without worrying about legal complications.
Papaya’s platform includes a self-guided tour that demonstrates how payroll professionals can use their technology to automate and manage their global payroll quickly and compliantly.
Papaya Global Key Services:
Papaya Global's services include advanced compliance, liability coverage, employee contract lifecycle management, immigration and visa assistance, data security monitoring, and enterprise-grade global payroll processing using an AI-based payroll engine.
Their EOR team also offers additional HR services such as onboarding, benefits management, and employee support. This holistic approach helps businesses provide a consistent and supportive experience for their employees in Portugal, enhancing employee satisfaction and retention.
Pros and cons
Pros:
- Integrated HR services
- Strong compliance management tools
- Comprehensive global payroll solution
Cons:
- Potential delays in customer support responses
- Limited customization options
Other Portuguese Employer of Record Services
Here are some other EOR service providers in Portugal that didn’t make it into my top 10 shortlist, but are still worth considering:
- Skuad
Best EOR for intellectual property protection
- Remofirst
Best for 24/7 customer support and a dedicated account manager
- Rivermate
Best EOR service for managing the local social security system
- Gibson Watts Global
Best EOR service for risk management expertise
- EuroDev
Best for long-term European market entry
- Bradford Jacobs
Best for managing Portuguese payroll taxes
- Safeguard Global
Best EOR service for NGOs and non-profit organizations
- Teamed
Best EOR service for affordable pricing
- Boundless
Best for a percentage-based EOR service mode
- Gloroots
Best EOR service for small businesses or startups
Hiring in Portugal: Important Details
Here are some key details to note if this is your first time hiring staff located in Portugal. Your EOR provider will manage these compliance details on your behalf. However, proactively informing yourself of these details is always recommended before you invest your resources into sourcing staff based in Portugal.
In Portugal:
- Employment laws in Portugal are set by the Ministry of Labour, Solidarity, and Social Security (Ministério do Trabalho, Solidariedade e Segurança Social) and various labour courts.
- The legal body that monitors compliance with labor laws in Portugal is called ACT (Autoridade para as Condições do Trabalho).
- You can hire employees (full-time, part-time, temporary, or seasonal) or contractors. Your Portuguese EOR provider can help you determine the best hiring option depending on your needs while ensuring you avoid employee misclassification errors.
- Portugal has both mandatory payroll deductions and social security contributions that must be collected, including the following:
- Social Security Contribution (Segurança Social)
- Personal Income Tax (IRS - Imposto sobre o Rendimento das Pessoas Singulares)
- Labour Accident Insurance (Seguro de Acidentes de Trabalho)
- Portuguese is the official language in Portugal. However, Mirandese is also officially recognized as a co-official language in some regions, and many professionals also speak fluent English.
- The standard working week in Portugal is 40 hours per week for a 5-day work week. The maximum number of consecutive working days per week is 6 days.
- Overtime is allowed under the Portugal Labour Code and is calculated at an additional 25% for the first hour and 37.5% for subsequent hours on a weekday, and at 50% on weekends and holidays.
- In Portugal, employees are paid monthly, plus they receive a 13th and 14th-month payment. The 13th month payment is given in June (for summer holidays) and the 14th month is given in December (for Christmas).
- Paid vacation in Portugal starts at 22 days of annual leave per year.
- There are 13 national public holidays in Portugal that employees are paid for, plus several regional holidays that are celebrated locally within Porto, Braga, Madeira and Azores. Understanding and complying with employment norms and legal requirements surrounding Portuguese public holidays is one area where your EOR service will shine, managing these occurrences hassle-free on your behalf.
- National public holidays in Portugal include:
- New Year's Day (January 1)
- Good Friday (variable date)
- Easter Sunday (variable date)
- Freedom Day (April 25)
- Labour Day (May 1)
- Portugal Day (June 10)
- Corpus Christi (variable date)
- Assumption Day (August 15)
- Republic Day (October 5)
- All Saints' Day (November 1)
- Restoration of Independence Day (December 1)
- Immaculate Conception (December 8)
- Christmas Day (December 25)
- Portugal offers maternity leave and paternity leave.
- The maternity leave entitlement is 120 to 150 days, beginning up to 6 weeks before the child’s birth.
- The paternity leave entitlement for fathers is 20 days, to be taken within 6 weeks of the birth.
- During these leaves, employees receive 100% of their average earnings paid by Portugal’s Social Security system.
- Paid sick leave in Portugal can stretch up to 1,095 days (over three years), with the Social Security system covering 55% to 75% of the employee's average earnings.
- The probationary period in Portugal varies depending on the type of position. It’s typically 90 days for most employees, 180 days for positions of high complexity, responsibility, or technical nature, and up to 240 days for managerial roles.
- The termination terms in Portugal are mandated by the Portuguese Labour Code. The required notice period ranges from 15 days for employees with less than one year of service to 60 days for those with more than two years of service. This is another area where a local Portuguese EOR can provide assistance to ensure the probation period and related severance are handled correctly.
- Severance pay is mandatory and is calculated based on the employee's length of service, generally amounting to 12 days' base salary for each full year of employment.
Selection Criteria for Employer of Record Portugal
Uncovering the best EOR services for this list required a deep understanding of how these services can alleviate common challenges, such as legally hiring employees abroad, managing international payments, ensuring compliance with local labor laws, providing competitive benefits, and facilitating smooth onboarding.
My approach to choosing the best EOR services is grounded in thorough research into recently published employer of record market data and an understanding of which partnerships would add the most value for organizations hoping to access the global talent market.
Here are the specific criteria I used to carefully compare the service offerings for each provider in this list:
Core Employer of Record Services (25% of total score): To be considered for inclusion in this list, each EOR provider had to offer the following basic services first:
- The corporate structure to legally and compliantly hire employees in multiple countries without a local entity
- The ability to manage global payroll and taxes in compliance with local regulations
- Assistance with offering competitive and locally compliant benefits packages
- Assistance with navigating visa and work permit processes for expatriate employees
- Robust procedures to ensure data privacy and security that comply with international standards, including GDPR and other requirements
Additional Standout Services (25% of total score): To help me narrow in on the best EOR services out of the numerous options available, I also took note of any unique or less common services, including:
- Advanced technology platforms that streamlined payroll and HR processes while still offering ease of use
- Specialized experience in hiring employees within specific new countries or key industries
- Services that enhance remote work compliance and global mobility needs
- Specialized customer support for complex immigration cases
- Assistance with international IT requirements, including managing computer equipment, software licenses, and other asset-tracking requirements
- A focus on eco-friendly and sustainable employment practices
Industry Experience (10% of total score): To evaluate the industry experience of each EOR service provider, I considered the following:
- How many years their business has operated in the EOR space
- Any industry recognitions or certifications the provider may hold in international HR and payroll
- Their depth of knowledge in local labor laws across multiple jurisdictions
- Their expertise in new markets, including how many different countries they offer local expertise in
- Evidence of a strong track record managing global expansion processes
- The combined experience and credentials of their team members, if available
Customer Onboarding (10% of total score): To get a sense of each provider's customer onboarding process, I considered the following factors:
- The availability of comprehensive onboarding materials, such as fact sheets, guides, FAQ repositories, or other training resources
- Support for integrating the EOR provider's software with existing HR systems
- Direct access to onboarding specialists, customer support, or a dedicated account manager during the setup phase
Customer Support (10% of total score): Since the EOR provider will act as your remote workers' legal employer, it's important to ensure you'll receive timely communications and top-level support. To evaluate the level of customer support each company offered, I considered the following:
- The availability of a multilingual support team that covers different time zones
- Multiple support channels, including phone, email, and live chat
- Evidence of responsiveness and effectiveness in resolving issues, as inferred from customer reviews
- The existence of dedicated account managers to provide assistance as needed
Value for Price (10% of total score): To gauge the overall value of each service, I considered the following factors:
- Transparent pricing models without hidden fees
- Comparative analysis of service offerings versus cost
- Flexibility in service packages to suit different business sizes and needs
Keep in mind that EOR services are complicated, and because of that the price tag can sometimes be high. However, the prices for their services still offer a good ROI considering the complexity of the premium-grade services you're gaining.
Customer Reviews (10% of total score): Evaluating customer reviews is the final element of my selection process, which helps me understand how happy real users are with a service. To determine this, I considered the following factors:
- Consistently high ratings across various consumer review platforms
- Specific feedback on the ease of use of the EOR services
- Testimonials highlighting exceptional customer support and problem resolution
Using this assessment framework helped me identify the employer of record services that go beyond basic requirements to offer additional value through unique services, deep industry experience, smooth onboarding, effective support, and overall value for price.
Trends in Employer of Record Services
As more businesses expand across borders, the need for efficient, compliant, and user-friendly solutions for hiring employees abroad, and managing international payments, compliance, benefits, and onboarding has never been more critical. As a result, employer of record services have continued to evolve, with an emphasis on technology-driven solutions that offer flexibility, comprehensive support, and innovative features to facilitate global operations.
Here are the most recent trends affecting EOR services and the HR software systems that are used to offer them:
- Immigration Support: There is a growing demand for assistance with immigration services like visa and work permit sponsorships, simplifying global talent acquisition processes for client companies immensely.
- Specialized Services for Diverse Needs: Several EOR providers have begun to offer IP and invention rights protection and equity incentive planning services, to cater to the specific needs of their client companies.
- Enhanced Employee Benefits Packages: There's a growing trend in EOR providers going beyond standard healthcare coverage to offer a full spread of enterprise-level medical and health benefits, stock options, and even one-time benefits like moving bonuses. This trend demonstrates an understanding of the importance of attracting and retaining top talent globally.
- AI-Backed Knowledge Bases: Some EOR providers (including Deel) are beginning to offer legally vetted knowledge bases or information wikis that use artificial intelligence to surface answers to common questions quickly. This helps customers source details on hiring within a specific country fast, without relying on human-run support systems.
As the market continues to evolve, these trends are likely to shape the future of international employment, making it easier for businesses to navigate the challenges of global expansion. For a closer look at specific EOR providers that are capitalizing on these trends, I recommend reading our in-depth reviews of Oyster HR, Skuad, and Velocity Global.
Key Employer of Record Services
By leveraging an EOR service, companies can manage international payments, ensure compliance with local labor laws, provide competitive benefits, and optimize their new hire onboarding process. Here are the most important services to look for in an EOR service provider:
- Global Payroll Management: Arguably one of their most important tasks, an EOR service will ensure your employees are paid accurately and on time in their local currency. This service is essential for maintaining employee satisfaction and financial stability in diverse geographic locations.
- Tax Compliance and Withholding: An EOR service will also manage employee income tax withholdings and employer tax obligations per local laws, preventing legal issues and ensuring smooth operations across different tax jurisdictions.
- Local Labor Law Compliance: EOR service providers offer country-specific knowledge of employment laws and regulations. This knowledge protects businesses from legal disputes and fines, ensuring a respectful and lawful work environment for all employees. Knowledge of these laws also applies to monitoring employee work hours, including timesheets and time-off requests.
- International Talent Acquisition & Background Checks: An EOR service will work with their client company to source additional talent from the global market as needed. As part of this process, many EOR services include background checks for potential new hires to confirm their credentials and ensure they're suitable for their role. Once approved, an EOR will also manage your country-specific employment contracts as well.
- Visa and Work Permit Sponsorship: Many EOR providers offer assistance with obtaining necessary visas and work permits for expatriate employees. This service is critical for facilitating the legal employment of foreign nationals and ensuring a seamless relocation process.
- Onboarding and Offboarding: An EOR will also manage the processes of integrating new hires into their client's company or managing their departure. This ensures a smooth transition for both employees and the organization and gives peace of mind that employee terminations are handled as per the labor laws of each jurisdiction.
- Benefits Administration: By leveraging economies of scale, EOR service providers can access competitive, region-specific health insurance benefits packages to cover your international employees. Tailored employee benefits are crucial for attracting and retaining top talent, enhancing job satisfaction, and meeting legal requirements for employee welfare.
- HR Support and Consultation: EOR specialists are a valuable resource as they can provide ongoing human resources support and expertise on international employment practices. This support ensures that businesses can navigate complex HR issues, deal with grievances effectively, and maintain positive employee relations without affecting their employer brand.
- Risk Management and Insurance: Since EOR providers assume legal responsibility for your foreign staff, this also includes managing employment-related risks, handling workers' compensation matters, and maintaining certificates of insurance, including both professional indemnity and public liability. This coverage is vital for protecting businesses and employees against unforeseen circumstances.
- Multi-Language Support: EOR providers offer services in multiple languages to help organizations operate efficiently in a global marketplace and serve the needs of a diverse workforce. This can include translation services for your corporate policy documents, as well as localized assistance in your international employees' native language, to prevent possible miscommunications.
As you can see, EOR service providers offer a full set of comprehensive services to help businesses expand their operations globally without the burden of navigating international employment laws and practices on their own. By securing an EOR partner to cover these critical services, you'll gain peace of mind, and more time to concentrate on your core business objectives.
Benefits of an Employer of Record Service
EOR services are a savvy option for organizations looking to expand their global footprint without the complexities and liabilities associated with international employment laws and practices. For companies contemplating global expansion, understanding the benefits of partnering with an EOR can provide the clarity and confidence you need to move forward.
Here are several benefits you’ll gain by using an EOR service:
- Quick Market Entry: For organizations aiming to test new markets or hire talent in new countries where they have no legal presence, an EOR offers a swift and efficient solution to initiate operations, saving time and resources.
- Simplified Global Payroll: Using an EOR service simplifies the complex process of managing international payroll, including tax deductions, withholdings, and currency conversions for your employees worldwide.
- Global Compliance & Risk Mitigation: By managing compliance, an EOR service provides expertise in navigating the intricacies of employment laws, tax regulations, and insurance requirements in multiple jurisdictions, helping businesses safeguard their operations against compliance-related risks.
- Enhanced Benefits Negotiation: By leveraging their extensive networks and purchasing power, EORs can negotiate better international insurance rates and secure competitive benefit packages on your behalf, enhancing your ability to attract and retain top talent worldwide.
- Improved Cost Effectiveness: Using an EOR service is a cost-effective way for businesses to enter new markets, compared to the significant costs of establishing a new foreign entity. The latter option involves significant upfront legal fees, plus other costs related to office infrastructure, staffing, and local benefits and insurance coverage.
Understanding the benefits of an EOR service is crucial for strategic planning and operational efficiency. As businesses look towards international markets for growth opportunities, partnering with an EOR provider offers a streamlined, cost-effective, and compliant pathway to global expansion.
Need a bit more firepower to convince your upper management to partner with an EOR service? Focusing on the costs of hiring a foreign employee and how an EOR can simplify the hiring process might just be the winning strategy you need.
Costs & Pricing for Employer of Record Services
Typically, the cost of an EOR service follows a fee per-employee, per-month pricing model, which can vary widely depending on a range of factors. This model allows for scalability and predictability in budgeting for international expansion efforts.
In general, EOR services in Portugal cost between $199 to $2,000 per employee, per month.
Key factors that can influence the pricing of an employer of record service include:
- Geographic Location: Costs can vary significantly based on the country or countries you're hiring in. This is due to local economic conditions, labor laws, and the complexity of compliance requirements.
- Employee Seniority and Role Complexity: The level and nature of the roles being filled can also impact the monthly cost. Senior positions or roles requiring special qualifications may increase the price due to higher benefits and compensation management costs.
- Number of Employees: The total number of employees being managed can also impact the cost. In some cases, higher volumes may lead to volume discounts, making per-employee costs more economical.
- Custom Requirements: Any specific needs beyond the standard service offering may also contribute to the monthly cost. This may include customized solutions for recruitment, specialized employee onboarding, or unique compliance requirements, all of which can affect pricing.
Some EORs also operate under different pricing models, including a percentage of employee salary model, a fixed pricing model, and custom pricing models. If you'd like to delve deeper into the different factors that influence prices, my article explaining the intricacies of different EOR pricing models is a natural next step.
When considering an EOR service, it is crucial to understand how these factors impact the overall cost to ensure that the service aligns with your business's needs and budget constraints. Anticipating the specific requirements of your international expansion strategy will help you choose the most cost-effective and efficient EOR solution for your needs.
FAQs about EOR Services in Portugal
If you’ve got specific questions about the requirements to hire Portuguese employees or how EOR services work, these answers to frequently asked questions are a good place to start:
What does an Employer of Record do?
An Employer of Record (EOR) service provider is a third-party entity that can help an organization hire a new employee in a country where it has no physical presence. It’s a useful service for businesses that are expanding internationally but don’t have physical offices established yet, or don’t ever plan to establish them. In these situations, the EOR provider becomes the legal employer of your remote staff on your behalf.
In this type of partnership, the EOR service provider deals with local employee-related matters such as managing payroll, deducting taxes, and administering the onboarding process for new employees. This allows organizations to access global talent while reducing their legal liabilities and compliance risks. This is because the EOR company assumes the legal responsibility for your international new hires on your behalf.
What are the minimum wage requirements in Portugal?
As of January 2024, the minimum wage in Portugal increased to €820 per month. This amount is the same across all age groups and for all regions in mainland Portugal. The regions of Madeira and the Azores have slightly different minimum wage rates due to the higher cost of living in these areas, with Madeira’s minimum wage at €850 per month and the Azores at €861 per month.
Portugal’s minimum wage is calculated over 14 monthly payments per year, including two additional payments made in June and December, known as the summer and Christmas bonuses. When spread over 12 months, the minimum wage is effectively higher, averaging around €956.66 per month.
Do EOR providers offer other types of global HR services?
Yes, most of the time they do. Many service providers in this space also offer professional employer organization services (also known as PEO services), as well as global payroll services.
PEO services are a way of outsourcing your HR function to support your international teams. PEO companies can help you with international compliance issues, benefits administration, workers’ compensation, and other HR administrative tasks.
Global payroll services allow you to easily pay remote employees or independent contractors within a unified payroll run. They manage in-country compliance requirements and juggle payments in multiple local currencies on your behalf.
To dive even deeper into this topic, read our article covering other types of global HR services to figure out the best fit for you.
What are some of the consequences of non-compliance?
As an organization, you never want to be deemed as non-compliant in the eyes of any government body. The exact rules and regulations will vary according to the jurisdiction you’re operating in, which is one of the main benefits of using an EOR service provider.
If you don’t use an EOR and you do hire international workers, you may quickly find yourself in non-compliance. The consequences of doing so will depend on the severity of the violation, but they could include all of the following:
- Fines and penalties
- Legal actions such as lawsuits or other litigation proceedings
- Corrective measures and compliance orders
- Revocation of business licenses or operating permits
- Reputational damage if the news becomes public (loss of public trust and loss of internal employee respect)
- Increased monitoring and additional government scrutiny
Companies who fail to follow international labor laws cannot simply say they were unaware of the legalities, and hence, didn’t follow them. That’s where an EOR service can really remove a lot of potential risk and liability from the international hiring process.
To brush up on your compliance best practices, have a quick read through our 2024 HR Compliance Guide.
Are there any risks to using an Employer of Record service?
In the world of business, nothing is ever 100% risk-free, and that is true for EOR services as well. While EOR services do offer substantial advantages, here are some of the risks you should also be mindful of as you choose the right partner for you:
Financial risks:
- Hidden costs and service fees: Some EOR providers may charge additional service fees for specific tasks, such as processing documents, onboarding or offboarding employees, or providing additional HR advice.
- Mandatory benefits: Some countries require mandatory benefits for employees. In that case, the EOR will charge you for those benefits in addition to the employee salary and their service percentage, which can add up.
- Currency fluctuations: Exchange fluctuations can impact the cost of payroll and other financial transactions as the strength of a currency you’re using goes up or down.
Operational risks:
- Data security: Since you’re entrusting sensitive employee data to your EOR, you’ll want to consider the strength of their data protection practices and policies, including their incident response plans, IT penetration testing, and data management certifications, such as ISO 27001.
Strategic risks:
- Loss of control: You will need to relinquish some degree of control over the workforce management processes of your EOR employees, which may impact your organization’s strategic decision-making capabilities.
- Brand reputation: Any negative actions, incidents, or practices of your chosen EOR can directly impact your organization’s brand reputation and create a negative employee experience if not handled properly.
For a deeper dive into this topic, read our comprehensive guide to EOR risks, including strategies to mitigate each potential issue upfront.
What is a nearshore vs offshore employee?
A nearshore employee is based in a country closer to the company’s location, typically within the same or a nearby time zone, making collaboration and communication easier due to the smaller time difference.
For North American companies, nearshore remote workers may reside in Canada, the Caribbean, or Central or South America.
An offshore employee is located in a country far from the hiring company’s home base, often in a different time zone, to capitalize on cost savings and increase access to a broader talent pool.
For North American companies, offshore remote workers may reside in Asia, Africa, or Europe.
Gain Access to the Best Talent with an EOR in Portugal
If you made it this far, I hope you have a better sense of how EOR services can simplify the process of hiring Portuguese employees. They're truly a valuable resource, whether you're an enterprise organization looking to snap up the top talent in Portugal, or a small business or startup trying to break into the Portuguese talent marketplace without launching your own entity.
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