How much does it cost to use an Employer of Record (EOR) in Eastern Europe?
- Gegidze • გეგიძე | Marketing
- Jul 5
- 10 min read
Table of contents:
Introduction
You’ve found the perfect backend developer in Bucharest. Or maybe a bilingual support lead in Sofia. You’re ready to make an offer, but your legal team throws up a red flag:
“How are we going to employ them legally without setting up an entity?”
Cue the panic scroll through contractor agreements, tax laws, and forums filled with outdated advice. One wrong move, and you're looking at misclassification penalties, frozen bank accounts, or backdated payroll taxes.
Here’s the fix: Employer of Record (EOR).
It’s the model global teams use to hire full-time employees legally in Eastern Europe without opening a company, hiring local HR, or filing tax forms in Bulgarian at midnight. The EOR becomes the legal employer on your behalf. You manage the team. They handle everything else: contracts, taxes, payroll, benefits, compliance.
But let’s be real: EOR isn’t free. And not all EORs charge the same way.
That’s why understanding the true cost of using an EOR in Eastern Europe isn’t just a nice-to-have; it’s business-critical. Whether you're hiring one engineer or building a 20-person support hub, you need clarity on what you’re paying for, what’s included, and what might still land on your finance team’s desk.
This article unpacks it all: flat fees vs percentage models, salary benchmarks by country, hidden costs, and how to make the smartest choice for your hiring goals.
What does the EOR fee typically cover?
If you’re paying a provider to legally employ someone on your behalf, you better be getting more than just a contract template and a monthly invoice.
A real EOR service in Eastern Europe covers everything it takes to keep your hire legal, paid, and protected without you needing to speak Romanian, register a tax ID in Poland, or guess what "social insurance" actually means in Ukraine.
Let’s break it down.
Legal employment and compliance
The EOR becomes the official employer in the eyes of the local government. That means:
Registering your employee with tax and social security authorities
Keeping up with changing labor laws in each country
Handling legal terminations, notice periods, and severance
Avoiding misclassification risks that can trigger audits or fines
You don’t need to hire a compliance team. That’s what the EOR is for.
Payroll processing and tax filing
Each Eastern European country has its own tax code, social contribution scheme, and reporting deadlines. You shouldn’t need a local accountant every time zone.
The EOR handles:
Monthly payroll calculation and payslip creation
Tax withholding and filing
Employer-side contributions to social security
Year-end tax documentation and reporting
Your employee gets paid on time. Your company stays compliant.
Mandatory and common employee benefits
Every country has its own set of legally required benefits and unspoken expectations.
Your EOR ensures compliance with:
Paid annual leave (typically 20+ days)
Sick leave policies
Maternity/paternity leave
Social insurance coverage (pensions, disability, unemployment)
And if you want to go beyond the minimum, health insurance, internet stipends, and coworking memberships, the EOR can administer those too.
Bilingual contracts (local + English)
An employment contract in English only? That won’t cut it in most of Eastern Europe. Labor authorities expect contracts in the local language—Polish, Bulgarian, Ukrainian, etc.
Your EOR provides:
Legally binding employment contracts in the local language + English
Role-specific terms (probation, notice, benefits, non-competes)
IP assignment and NDAs tailored to local law
You’re protected. Your hire is protected. Everyone’s covered.
Salary disbursement and foreign exchange (FX)
You want to pay in EUR or USD. Your employee expects local currency in their bank account.
The EOR handles:
FX conversion and timing
Local bank transfers
Payroll compliance with minimum wage thresholds and payment timelines
No headaches over wire fees, currency rules, or payment delays.
Ongoing HR and onboarding support
EOR isn’t just “set it and forget it.” They handle:
Employee onboarding (ID numbers, social security registration, tax forms)
Mid-employment events (leaves, promotions, benefits updates)
Terminations and offboarding
Day-to-day HR queries from your team
You focus on performance and culture. They handle the paperwork and red tape.
Breakdown of EOR costs in Eastern Europe
EOR pricing can feel like a black box until your finance team opens the invoice and asks, “Wait, why are we paying more this month?”
Here’s the truth: not all EORs charge the same way, and the model you choose will affect your long-term hiring costs more than you think.
Flat fee vs percentage-based: Why it matters
There are two common EOR pricing structures:
Flat-fee model (like Team Up):
You pay a fixed monthly amount per employee
Predictable, scalable, and unaffected by salary increases
Team Up’s flat fee: €199 per employee/month
Percentage-based model:
You pay 10–15% of the employee’s gross monthly salary
The more you pay your team, the more you pay the EOR—forever
Can become costly at the mid-senior level
Let’s compare.
Real monthly cost examples (salaries + EOR fees)
Percentage models might look cheaper at the junior level, but as soon as you scale senior hires, costs escalate. And those costs don’t reflect better service. Just higher commission.
What’s included, and what’s not
Here’s what you can expect from a high-quality EOR like Team Up:
Included in €199/month flat fee
Legal employment and HR compliance
Payroll processing and tax filing
Local labor contracts in both languages
Social contributions and employee registration
HR onboarding, leaves, and terminations
Not included (but manageable via add-ons):
Workspace costs (coworking or private office)
Equipment costs (laptops, accessories)
Bonuses or 13th-month salaries (paid at your discretion)
Optional benefits (private health insurance, internet stipends)
These extras are optional and fully supported if you want to provide them. But with Team Up, you’re always clear on what’s covered and what isn’t.
EOR vs setting up your own entity: Cost comparison
Thinking of hiring in Eastern Europe and wondering whether it’s worth setting up your own company instead of using an EOR? Let’s break it down, because the costs go far beyond the notary fee.
Upfront setup costs vs ongoing EOR fees
Registering an entity in Romania, Poland, or Bulgaria means hiring local consultants, renting a physical office (required in some jurisdictions), and navigating every tax code yourself. You’ll need local accountants, lawyers, and potentially even a company director.
With an EOR, your cost per hire is fixed, your launch time is fast, and you don’t need to spend a single euro on incorporation.
Administrative overhead and compliance management
Hiring one person? Maybe it’s manageable. Hiring five? You’re suddenly a local employer, whether you like it or not.
With your own entity, you’ll be handling:
Payroll tax filings every month
Local labor contract templates
Annual reports and financial statements
Employment law changes (and they do change)
Termination processes and dispute resolution
With Team Up’s EOR, all of that disappears. You focus on the team. We handle the law.
Risk exposure and hidden expenses
It’s not just paperwork, it’s liability.
Misclassified contractors can trigger retroactive employment claims
Payroll mistakes can lead to government audits or frozen accounts
Missing social contributions may result in interest + penalties
IP and tax residency issues can get you in legal hot water fast
With an EOR, you’re shielded. We take legal responsibility as the employer, so your risks drop dramatically.
Short-term flexibility vs long-term scalability
Here’s the real question: Are you testing the market, or planting a flag?
Use an EOR if you:
Want to hire 1–20 people
Need to start now
Don’t want local overhead
Value speed, compliance, and low risk
Consider your own entity if:
You plan to hire 50+ full-time staff
You need a physical branch office
You want to issue local invoices or trade in-country
You have long-term plans in a single Eastern European market
For most growing startups and global teams, an EOR is the smarter, cheaper, and faster way to scale without the headache.
And if you ever outgrow the EOR model? You can always set up your entity later, once your business case is clear.
Payroll taxes and statutory benefits in Eastern Europe
Hiring in Eastern Europe comes with real tax and benefit obligations; ignore them, and you’re not just skipping paperwork. You’re skipping legal employment.
But before you panic-Google “how to calculate pension contributions in Romania.” Here’s what you actually need to know.
What employers are legally required to pay
Each country in Eastern Europe has its own system, but one thing is consistent: employers must contribute to payroll taxes and statutory benefits. Here’s a quick snapshot:
These are calculated on top of gross salary, not included in it. So when budgeting, you need to add these costs to whatever monthly pay you offer.
What employees are entitled to by law
You can’t skip benefits in Eastern Europe. They’re mandatory and heavily enforced.
Here’s what every full-time employee gets under local law:
Paid annual leave: 20+ working days in most countries
Public holidays: 10–15 per year, depending on the country
Sick leave: Paid (partially or fully) after medical certification
Maternity/paternity leave: Often 12+ months with partial wage coverage
Healthcare access: Funded through employer/employee contributions
Pension contributions: Automatically deducted and reported
These aren’t “perks.” They’re the law.
How an EOR makes this easy
With Team Up as your EOR, you don’t need to hire a local accountant or monitor legislative updates every quarter. We handle:
Accurate calculation of employer and employee contributions
Timely payments to tax and social funds
Payslip generation in the local language + English
Leave tracking and benefit processing
Year-end reports and government filings
Your employee gets paid, taxed, and protected without your team spending a second navigating unfamiliar systems.
Talent acquisition & management costs
Hiring great talent in Eastern Europe is only half the battle. Doing it efficiently without burning time, budget, or legal bridges is where most companies get stuck.
That’s where using an EOR like Team Up actually saves you more than just compliance headaches. It cuts down on hiring costs, internal admin, and friction.
EOR vs traditional hiring channels
Let’s say you’re entering a new market like Romania or Ukraine. You’ve got two options:
Hire through a local recruitment agency + set up your own entity
Agency fee: 15–25% of annual salary
Local HR/headcount management overhead
Full compliance liability on your side
Hire through Team Up’s EOR model
No recruitment fee (when using your own sourcing or Team Up Talent Pool)
No local HR admin
No legal exposure, you stay risk-free
The cost difference? Thousands of euros per hire. The time difference? Weeks.
What roles are companies hiring in Eastern Europe via EOR?
Team Up helps companies hire remote teams across the region, especially for these high-demand roles:
Developers: Frontend, Backend, Full Stack, DevOps
Designers: UI/UX, Product Designers
QA & Testing: Manual and Automation
Customer Support: Multilingual Tier 1 and Tier 2
Marketing & Sales: SDRs, Content Managers, SEO specialists
Project Managers: With Agile/Scrum certifications
These roles are available in English-speaking, senior-level talent pools across Romania, Bulgaria, Poland, and Ukraine.
Sample monthly gross salaries (EUR)
Combine this with Team Up’s flat EOR fee of €199/month, and you’ve got full legal employment at a fraction of Western European costs with none of the red tape.
How Team Up reduces hiring friction
With Team Up, you skip:
Weeks of setup to open a local entity
HR headaches like contracts, leave tracking, and payroll errors
Bottlenecks in finance and legal
You get:
Talent pre-vetted by local experts
Fast onboarding (1–2 weeks from offer to start)
One invoice per month, all-in
Local HR support without building local HR teams
Scaling your team in Eastern Europe shouldn’t feel like starting a new company. With Team Up, it won’t.
Equipment and workspace costs
Hiring someone remotely in Eastern Europe? You’ll need to figure out where they’ll work and what they’ll work on.
No, EOR doesn’t mean handing over a laptop in a parking lot. But it also doesn’t mean you’re stuck shipping hardware across borders or guessing coworking prices in Kyiv.
Let’s break down how equipment and workspace costs work when hiring via an Employer of Record.
Who pays for what?
In most cases, you (the client) are responsible for providing the essentials: a laptop, software licenses, a monitor, headset. But you don’t have to deal with shipping or customs forms.
With Team Up, you can:
Send a stipend (e.g. €600 for setup)
Source and purchase locally via our team
Lease monthly equipment per hire
Opt into a fully managed workspace and gear bundles
Whatever’s easiest for you, we’ll make it happen.
Workspace setups: Remote, coworking, or office
Eastern European hires typically fall into three workspace setups:
Fully Remote (Home Office)
Most cost-effective
Employees use their own space
Often combined with a one-time equipment stipend
Estimated cost: €0–€69/month (if leasing basic hardware)
Coworking Spaces
Popular in cities like Bucharest, Sofia, Kraków, and Lviv
Improves structure, collaboration, and professionalism
Ideal for customer-facing or mid-level roles
Estimated cost: €100–€200/month per employee
Private Offices or Hubs
Best for teams of 5+ in one location
Includes branding, meeting rooms, security, and local address
You may share with other Team Up clients or rent dedicated space
Estimated cost: €400+/month per person, depending on city and setup
Flexible workspace options on your terms
Team Up doesn’t lock you into one model. You decide what’s needed for each hire:
Remote setup with no added cost? Easy.
Need a premium office with access cards and catered lunch? We’ll arrange it.
Want to mix remote and office access with hot-desking? We support hybrid setups, too.
And because you’re hiring through our EOR model, everything, workspace, equipment, and stipends, is managed and tracked legally and compliantly.
You get visibility. Your hire gets everything they need to do great work. No logistical drama.
Conclusion
Hiring in Eastern Europe doesn’t have to feel like a gamble.
You don’t need to guess which tax forms to file in Sofia or wonder if your remote developer in Cluj is technically “a contractor” or “an employee.”
With the right Employer of Record, you get:
Transparent costs (starting at €199/month)
Full legal compliance across multiple countries
Fast onboarding and zero admin burden
Access to top tech, support, and creative talent across the region
No hidden fees. No legal guesswork. Just a clear path to building your remote team, safely and affordably.
Thinking of hiring in Romania, Bulgaria, or Ukraine?
Let’s talk.
