- A PEO is a US arrangement. US tax law defines a certified PEO, and the IRS requires one to have at least one physical business location in the United States. The PEO shares employer responsibilities with a client that is already the employer.
- Abroad, a "global PEO" is an Employer of Record. Papaya Global, for example, says PEO and EOR "refer to the same services within the international sphere", and that a global PEO lets you hire overseas without opening a local entity.
- The big providers' PEO products are US-only: Deel describes its PEO as a co-employment model that requires a legal entity in the US, and Remote's PEO is for hiring across the US, billed in US dollars with a US bank account.
- So, outside the US, choose between two things: an EOR if you have no entity in the country, or a payroll provider if you have your own entity there.
Under section 7705 of the Internal Revenue Code, a certified professional employer organization (CPEO) is one the IRS has certified. Its written contract with the customer must make it responsible for paying wages, reporting, withholding and paying employment taxes, any benefits the contract requires and keeping employee records, regardless of whether the customer pays it, and for recruiting, hiring and firing in addition to the customer's own responsibility for those things.
That's co-employment: the client stays an employer, and the PEO takes on payroll, tax and HR duties alongside it. Certification is voluntary, and the IRS requires a CPEO to have at least one physical business location in the United States.
In some countries an EOR arrangement itself falls under temporary work or labour-hire rules, with licences and time limits; see EOR labour hire rules by country. For the US decision, see EOR vs PEO.
| Item | PEO (US) | Employer of Record | Staffing or temporary work agency |
|---|---|---|---|
| Who is the employer | Both: the PEO co-employs with your company | The EOR, through its own entity or a partner | The agency, which supplies the worker to work under your direction |
| Do you need your own entity? | Yes, in the US | No | No |
| Rules that apply | US tax law (26 U.S.C. § 7705) for certified PEOs | Local employment law; in some countries labour-hire rules too | Each country's temporary work or labour-hire rules |
If you already have your own company in the country, compare global payroll prices instead: running payroll for your own entity costs far less than an EOR.
| Country | What to know | Lowest published EOR fee in our guide | Employer costs (mid-level salary) |
|---|---|---|---|
| Singapore | Foreign hires need an Employment Pass applied for by a Singapore employer; ask whether your EOR will apply for one. | US$199 (RemoFirst) | 17.2% |
| Portugal | Salaries are paid 14 times a year: a Christmas allowance and a holiday allowance on top of 12 monthly payments. | US$349 (RemotePass) | 25.2% |
| Ireland | Pension auto-enrolment (MyFutureFund) started in January 2026, with employer rates rising on a schedule. | US$349 (RemotePass) | 12.9% |
| Colombia | On top of social security, employers pay a service bonus (prima) and set aside severance savings (cesantías). | US$199 (RemoFirst) | 34.2% |
| Australia | Labour hire licences are required in Queensland, Victoria, South Australia and the ACT, and can apply to EOR arrangements. | US$199 (RemoFirst) | 18.2% |
Is there a PEO in Singapore?
Is there a PEO in Portugal?
Is there a PEO in Ireland?
What is a global PEO?
What's the difference between a PEO, an EOR and a staffing agency?
- 126 U.S.C. § 7705: Certified professional employer organizations
U.S. Government Publishing Office (govinfo)
Definition of a CPEO, the service contract requirements (e)(2), including hiring and firing in addition to the customer, and the 85% work site rule (e)(3).
- 2Certified Professional Employer Organization (CPEO)
Internal Revenue Service
What PEOs do, the voluntary certification programme, and eligibility, including a physical business location in the United States.
- 3Deel pricing: PEO
Deel
PEO described as a co-employment and shared liability model that requires a legal entity in the US; checked 23 October 2026.
- 4Remote pricing: Professional Employer Organization (PEO)
Remote
PEO for hiring across the United States; billed in USD, requires a U.S. bank account; checked 23 October 2026.
- 5What is a global PEO and how does it work
Papaya Global
States that PEO and EOR refer to the same services internationally, and that a global PEO lets companies hire overseas without a local entity.
- 6Singapore: Employment Pass eligibility
Ministry of Manpower
Qualifying salary from S$5,600 (S$6,200 in financial services), COMPASS, and the higher salaries from 1 January 2027.
- 7Portugal: Labour Code (Código do Trabalho), Law 7/2009, consolidated
Diário da República
Arts. 40 (parental leave), 112 (probation), 131 (training), 140–149 (fixed-term contracts), 168 (telework expenses), 203, 228 and 268 (working time and overtime), 234–239 (holidays and leave), 263–264 (allowances), 351–373 (dismissal and compensation) and 400 (resignation notice).
- 8Ireland: Automatic Enrolment Retirement Savings System Act 2024 (revised)
Law Reform Commission (Revised Acts)
s. 50: enrolment at 23–59 with gross pay of at least €20,000; s. 58: no contributions on pay above €80,000 a year; s. 61: employer rate 1.5% (years 1–3), 3%, 4.5%, then 6%; contributions commenced 1 January 2026 (S.I. No. 500 of 2024 as amended).
- 9Colombia: Código Sustantivo del Trabajo
Secretaría del Senado (Colombia)
Labour code: hours, vacation, prima, cesantías, termination indemnities.
- 10Australia: Labour hire licensing
Queensland Government
Who needs a Queensland labour hire licence, what isn't labour hire, and exempt workers including the A$190,100 high income exemption (from 1 July 2026).
- 11Australia: Labour hire law changes 2026
Labour Hire Authority (Victoria)
Victorian licensing requirements, the stronger obligations from 1 June 2026 and maximum penalties (over A$660,000 for a company).
- 12Australia: Labour Hire Licensing Act 2017 (SA)
South Australian Legislation
Version of 29 January 2026: meaning of labour hire services (s 7), licence required (s 11), no arrangements with unlicensed providers (s 12); maximum penalties A$400,000 for a body corporate.
- 13Australia: Labour Hire Licensing Act 2020 (ACT), A2020-21
ACT Legislation Register
Republication 6, effective 26 December 2025: meaning of labour hire services (s 7), licence required (s 23), no arrangements with unlicensed providers, civil penalty up to 3,000 penalty units for a corporation (s 35).