Hire in United States

Introduction to employer of record (EOR)

An employer of record (EOR) is a third-party organization that takes on the legal responsibilities of employing workers on behalf of a client company. This arrangement allows businesses to hire and manage employees in the United States or other countries without the need to set up their own local entity. By acting as the legal employer, the EOR ensures that all employment contracts are compliant with local employment laws and regulations. EOR services typically include benefits administration, payroll management, tax compliance, and the drafting of employment contracts. For companies engaging in international employment, partnering with an employer of record EOR streamlines the process of employing workers abroad, reduces legal risks, and ensures ongoing legal compliance. This makes it possible for client companies to focus on their core business while the EOR manages the complexities of local employment requirements.

Employer of record in the United States

If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in the United States (US), an employer of record may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in the United States―often in as little as two weeks―without having to take on the cost and risk of establishing a local entity.

Learn about the hiring, employment, payroll and benefits requirements for workers in the United States and how our employer of record service, EOR, and local HR experts can help you manage your international employment needs.

Benefits of using an EOR service

Choosing an EOR service offers significant advantages for businesses looking to hire employees in new markets. One of the main benefits is the ability to quickly and compliantly hire employees without the need to establish a local entity, saving both time and resources. EOR services provide in-depth knowledge of local employment laws, ensuring that your business remains compliant with all federal and state regulations. By handling benefits administration, payroll, and tax deductions, an EOR service reduces the administrative burden on your internal teams. This not only helps mitigate legal risks but also enhances employee satisfaction by ensuring timely and accurate compensation and benefits. Ultimately, using an EOR allows your business to focus on growth and strategy, while experts manage the complexities of local employment laws and compliance.

Hiring in the United States

A combination of federal and state governments regulates employment in the US. Employer of Record (EOR) services ensure compliance with all relevant federal and state laws when hiring in the US. Generally, the US requires far less from employers than other countries when it comes to benefits, and especially paid leave of any kind (vacation, sick leave, maternity leave, etc.).

To remain competitive, however, most companies do offer a full complement of benefits, from health insurance to paid time off.

Most states consider employment to be at will, meaning that employees can be terminated (or quit) without notice or severance.

Since labor laws can vary considerably from state to state in the United States, compliant employment contracts are an essential business need. As your employer of record and PEO in the United States, we can ensure that every contract, for every worker, meets all legal requirements under US labor law. We can also provide you with guidance about cultural norms and hiring best practices, supporting a positive company culture for US-based teams, and keep you up-to-date with employment regulations as they change. Staying updated with state laws and labor law changes is essential for ongoing compliance.

Employment contracts in the United States

As you look to hire employees in the United States, it is crucial to focus on drafting employment contracts that comply with US regulations. This includes understanding the differences between full-time employees and contract workers, who are often hired for specific projects or timeframes and may require different legal considerations. Here are some common regulations you’ll need to know to create a compliant contract, as well as how an employer of record and PEO can help manage compliance for both full-time employees and contract workers throughout the employment lifecycle, providing support for your unique HR needs.

Working hours

While the typical workweek is eight hours a day and 40 hours a week, with two days off (usually Saturday and Sunday) there is no legal limit to the hours or days an employee can work. Some exceptions exist, e.g. for airline staff and long-haul truck drivers.

Compensation

As you consider the appropriate salary to offer new employees, keep in mind:

• The federal minimum wage is $7.25 an hour.
• Thirty states require a higher minimum wage.
• In some states, minimum wage requirements differ based on the total number of people employed.
• Collective agreements may regulate the legal salary range.

As your employer of record in the United States, we can provide you with resources and insights about employee compensation, so you are better equipped to make a competitive employment offer.

Bonuses

Bonuses are not required, though many companies offer them in recognition of outstanding personal performance and/or company performance.

Probationary period

Probationary periods are permitted and can range from one month to a full year.

Termination and severance

Most states consider employment to be at will, which means that an employee can be terminated at any time for any reason as long as it’s not illegal. Severance pay is not legally required in most states, but it is often included in employment agreements or benefits packages. Many employers do give notice, severance pay, or both, even though it is not mandated by law. Severance pay is often based on seniority and/or the total number of years worked for that employer.

Employers are not required to compensate employees for unused vacation days accrued unless specified in a contract or collective bargaining agreement. Some states require that the employer pay the employee for all outstanding wages, including unused vacation time if required, immediately upon termination.

Employee benefits and paid leave in the United States

When negotiating terms of an employment contract with a candidate in the United States, it is important to provide competitive health benefits as part of the employment package to attract and retain top talent.

Here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy. An EOR can also help manage employee data securely to ensure compliance with privacy regulations, and assist in protecting your company’s intellectual property when hiring employees in the US.

Maternity leave 

Employers in the US are not required to provide any paid maternity leave, although many offer it as a benefit. As a result, the duration and the amount of compensation vary.

The Family and Medical Leave Act (FMLA) is a federal law that entitles eligible employees of covered employers to take up to 12 weeks a year of job-protected, unpaid leave for specified family and medical reasons. FMLA applies to companies with 50 or more employees, federal, state, and local government agencies, and schools.

FMLA can be taken to care for a new baby, an adopted child, or a child in foster care; to care for a spouse, child, or parent with a serious health condition; for one’s serious health condition; and, as the result of the employee’s spouse, child or parent being on active duty or being called up for duty in the US National Guard or Reserves.

To be eligible for FMLA leave, an individual must meet the following criteria:

• Be employed by a covered employer and work at a worksite within 75 miles of where that employer employs at least 50 people.
• Have worked at least 12 months (which do not have to be consecutive) for the employer.
• Have worked at least 1,250 hours during the 12 months immediately before the date

Additionally, 26 workweeks of leave during a single 12-month period may be taken to care for a spouse, child, parent, or next of kin who is a covered service member with a serious injury or illness.

Vacation

Employers are not required to offer any paid vacation time, although most offer it to salaried employees to remain competitive, and some offer it to employees paid by the hour as well. The amount given differs from company to company, but two to four weeks is customary, with more offered according to an employee’s seniority.

Many employers in the US have switched from paid vacation and sick leave to Paid Time Off (PTO), where an employee can take a certain number of paid days off each year for any reason. Unlimited PTO is becoming more popular as well.

Holidays

The following are the federal holidays in the US:

• New Year’s Day
• Martin Luther King, Jr. Day
• Presidents’ Day
• Memorial Day
• Juneteenth
• Independence Day
• Labor Day
• Columbus Day (celebrated in some places as Indigenous Peoples’ Day)
• Veterans Day
• Thanksgiving Day
• Christmas Day

Employers are not required to offer any paid holidays, although most do. Non-government employers do not typically observe Columbus Day (or Indigenous Peoples’ Day) or Veterans Day but usually add the Friday after Thanksgiving, Christmas Eve Day, and New Year’s Eve Day.

Some employers, especially when required by a collective bargaining agreement, pay time-and-a-half or double-time to employees who work on federal holidays.

Sick leave

Employers are not required to offer any paid sick leave, though many do.

Health coverage

Employer-provided health care plans are required for many employers and can be provided without tax consequences to employees. Employers must obtain an Employer Identification Number (EIN) for payroll and health insurance compliance. The federal government sets requirements for health insurance and collects employment taxes. Adoption assistance payments up to certain amounts per year also can be excluded from income taxation. The cost of group-term life insurance coverage of up to US $50,000 is excluded from federal income tax.

The Medicare or Health Insurance (HI) component of the FICA tax also consists of an employer portion financed through direct payment by employers and an employee portion financed by withholding employees’ wages and remitting the withheld amounts to the Internal Revenue Service.

The employer portion is a flat rate of 1.45% on each employee’s wages. For each employee, a Medicare tax rate of 1.45% is assessed on wages paid to the employee during the year up to the annual wage threshold of US $200,000, and a rate of 2.35%, consisting of the base rate of 1.45% and additional Medicare tax rate of 0.9%, is assessed on wages paid to the employee during the year above the annual wage threshold of US $200,000.

Social Security tax and Medicare tax must be withheld from employees’ wages when they are paid to employees and the employer portions of these taxes must be paid when the withheld amounts are submitted to the IRS.

Additional benefits

In addition to healthcare benefits, employees in the United States are entitled to pension, which is funded by government tax revenues, as well as workers compensation, which is covered through mandated employer insurance.

Employer social costs will cover a large portion of employee benefits in the United States, but we can consult with you about supplemental coverage options, such as additional pension contributions or life insurance if needed.

Payroll and tax management

Effective payroll and tax management are essential for any business employing workers in the United States. An EOR provider takes responsibility for all aspects of payroll processing, including calculating employees’ wages, managing tax deductions, and ensuring timely payments. This includes compliance with local labor laws, minimum wage laws, and social security contributions. The EOR also manages tax compliance by filing all necessary returns with the Internal Revenue Service (IRS) and keeping up-to-date with changes in tax regulations. By outsourcing payroll and tax management to an EOR, businesses can minimize administrative tasks, reduce the risk of non-compliance, and ensure that all payroll processes are handled accurately and efficiently.

Work permits and visas

For companies hiring international employees in the United States, obtaining the correct work permits and visas is a critical step. An EOR provider can guide businesses through the complex process of securing legal authorization for foreign nationals to work in the country. This includes managing the application process, preparing and submitting required documentation, and ensuring that all government fees are paid. By leveraging the expertise of an EOR provider, companies can navigate the intricacies of U.S. immigration requirements, reduce the risk of non-compliance, and ensure that their employees are legally permitted to work in the United States.

Costs and pricing

The costs and pricing structure for EOR services can vary depending on the provider and the range of services required. Most EOR providers charge a fee per employee, typically calculated as a percentage of the employee’s salary—often ranging from 10% to 20%. This fee generally covers essential EOR services such as payroll management, tax compliance, benefits administration, and the drafting of compliant employment contracts. Some EOR providers may offer additional services, such as recruitment support or specialized benefits, for an extra fee. Understanding the costs and pricing of EOR services is crucial for businesses planning their international employment strategy, as it allows them to budget effectively and ensure they are receiving comprehensive support for their investment.

Updated: August 20, 2025

Employee onboarding with an employer of record in the United States

We write and validate all local employment contracts, streamlining the onboarding process for you and your American employees—all you have to do is provide relevant information and review and approve the employment agreement. As your employer of record in the United States, we will:

• Schedule a welcome call to discuss HR and employment information for the United States, as well as answer any questions 
• Prepare a customized employment contract in English 
• Share the employment contract and benefits information with the new employee for signature and review
• Gather tax and banking information from the employee to set up payroll 
• Provide a local point of contact to the employee to answer any questions regarding their employment, local HR or payroll

The entire onboarding process for the employee is often completed in as little as two weeks.

Partner with Safeguard Global as your United States employer of record and PEO

With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on EOR, our employer of record solution to expand and hire in over 170+ countries around the world, quickly and compliantly. 

We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in the United States. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone.

Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations— all around the world and can accommodate the payroll outsourcing needs of any size organization. 

Whether you’re looking to hire as part of a strategic expansion or to meet specific talent needs, our global solutions advisors can walk you through your international hiring options so you can make the right choice for your organization. Contact us today.

Disclaimer: The information provided on or through this website is for informational purposes only and does not constitute legal advice. Safeguard Global expressly disclaims any liability with respect to warranty or representation concerning the information contained herein, including the lost essence, interpretation, accuracy and/or completeness of the information in transit and language translation.