TL;DR
  • Percentage-of-salary EOR pricing scales your costs with promotions and raises. The incentives are upside down.
  • Watch for hidden fees: FX spread, 'platform' charges, statutory pass-throughs marked up, setup fees.
  • A flat fee per hire is the only structure that lets you predict next year's cost today.
  • On a $60K senior accountant, percentage pricing can cost $3,000 more per year than flat pricing.
  • Synapse Global charges $400 per month per hire. No percentages, no surprises, no markups on statutory pass-through.

The two pricing models, plainly

Almost every EOR you'll talk to uses one of two structures:

Flat fee per employee per month

The EOR charges a fixed dollar amount per hire, regardless of salary, role, or location. Synapse Global is in this camp at $400 per hire per month.

Percentage of monthly gross salary

The EOR charges a percentage, typically 8 to 15 percent, of the employee's monthly gross. The fee scales with what you pay.

Percentage pricing means every raise you give your team triggers a raise for your vendor. It is the only fee model in corporate operations that punishes generosity.

A worked example

Take a senior accountant in Kingston earning $60,000 USD annually. Under each model:

Flat-fee model ($400/month)

Annual EOR fee: $4,800. Promote the same person to $75K next year? Annual EOR fee: $4,800. Same.

Percentage model (10% of gross)

Year 1 annual EOR fee: $6,000. Promote to $75K: annual EOR fee: $7,500. A $15K raise just cost you an extra $1,500 in EOR fees on top of the raise itself.

$1,200
Year 1 savings: flat vs 10% on $60K
$2,700
Year 2 savings after a $15K raise
$0
Effort required to predict next year

The hidden costs nobody quotes upfront

The headline fee is only one line. Three others routinely double the real cost.

FX spread

Most EORs convert your USD into local currency at a marked-up rate, pocketing the spread. A 1.5 percent FX markup on a $60K salary is $900 a year. Ask: "what FX rate do you apply, and what is your spread over the interbank rate?"

Statutory pass-through markup

Some EORs apply a percentage markup on the statutory contributions they pay on your behalf. The contribution itself is a pass-through cost. The markup is pure margin. Ask: "do you charge a percentage on top of statutory contributions?"

"Platform" or "technology" fees

Sometimes a separate line for "platform access" at $50 to $150 per employee per month. Ask: "what is the total monthly invoice for one hire, all-in, with nothing pulled out as a separate fee?"

Setup or onboarding fees

One-time fees of $500 to $2,500 per hire. Sometimes refundable, often not. Ask: "is there any one-time fee at hire, and what happens if the hire doesn't stay?"

Five questions to ask any EOR
  • What is the total monthly invoice for one hire at $60K base, all-in?
  • Is the fee a flat dollar amount or a percentage of salary?
  • What FX rate and spread do you apply?
  • Do you mark up statutory contributions?
  • What one-time fees apply at hire or termination?

Why we chose flat

The flat-fee structure aligns our incentives with yours. Our cost to serve a hire is roughly the same whether the salary is $50K or $150K. The same payroll runs, the same statutory filings, the same HR support. Pricing should reflect that.

It also makes your model trivially easy: every additional hire adds $400 a month. You can run a five-year plan in a spreadsheet without calling your account manager.

Bottom line: If a quote uses a percentage of salary, ask for a flat equivalent. If they refuse, you've learned what their pricing optimizes for. (Their margin, not your scalability.)

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