Businesses today are exploring different ways to bring on talent while staying compliant and cost effective. Whether you’re growing into new markets or filling hard-to-hire roles, you might be comparing the value of an Employer of Record (EOR) vs staffing agency support. While both help companies engage workers, they serve different functions depending on your goals.
Understanding how EOR vs staffing agency solutions differ can help you make smarter decisions when it comes to risk, speed to hire and long-term workforce planning. Here’s how they compare and how to choose the right one for your business.
What Is an Employer of Record (EOR)?
An EOR is a third party that becomes the legal employer of a worker on behalf of your company. The EOR takes care of payroll, tax filings, benefits, workers’ compensation and compliance with state or federal labor laws. You still manage the worker’s day-to-day tasks, but the EOR handles everything tied to employment and risk.
EORs are often used when companies want to hire in states or countries where they don’t have a business entity. They also help reduce liability by taking on the responsibility of staying up to date with changing employment laws.
According to Deloitte, more than 70 percent of global companies are now considering EORs to support remote and international hiring as part of their workforce expansion plans (source).
What Does a Staffing Agency Do?
A staffing agency focuses on finding and placing qualified candidates. Agencies maintain networks of vetted talent and can quickly fill roles on a temporary, temp-to-hire or direct-hire basis. Some agencies also provide recruiting services for specialized or high-volume hiring needs.
With a staffing agency, the worker may be an employee of the agency or directly hired by your company, depending on the placement type. Agencies are a strong fit for short-term needs or hard-to-fill roles when internal recruiting resources are limited. Unlike an EOR, most staffing agencies do not handle ongoing compliance in multiple states or countries.
EOR vs Staffing Agency: Key Differences
When comparing EOR vs staffing agency services, consider these key differences:
- Legal employer: An EOR is the legal employer of record. A staffing agency may serve as the employer for temporary roles but not direct hires
- Compliance: EORs specialize in compliance and reduce risks related to payroll, benefits and labor laws. Staffing agencies may not cover all of these areas
- Talent sourcing: Staffing agencies actively recruit and place candidates. EORs typically support workers you have already identified
- Flexibility: EORs are ideal for hiring across state or country lines. Staffing agencies are great for fast, local placements
- Cost model: EORs usually charge a flat fee or percent of payroll. Staffing agencies add a markup to the candidate’s pay rate
When to Use an EOR vs Staffing Agency
The right solution depends on your goals. If you already have a candidate in mind and need to hire them in a state where you’re not registered to do business, an EOR can get them onboarded quickly and compliantly. If you need help finding candidates, especially for short-term or project roles, a staffing agency offers speed and reach.
At Suna Solutions, we offer both EOR and staffing support. We understand the challenges that come with rapid growth, compliance risk and hiring across regions. Our team helps you assess which model fits best for each role or initiative.
If you’re weighing the pros and cons of EOR vs staffing agency options, Suna Solutions can help. We support clients with scalable hiring and employment solutions that keep you compliant and competitive. Our team listens first, then builds a plan tailored to your needs.