Staffing agency vs EOR vs contractor: how to hire in Latin America
Short answer: if you only need one person you already found, a direct contractor or an Employer of Record (EOR) is enough. If you need someone to find, vet and manage the hire with no local entity, a remote staffing agency is the shortest path: it sources the profile, signs and pays the professional locally and sends you one monthly invoice. If you want the person on your own payroll, use a recruiting firm for a direct hire. Opening a local entity only pays off for large, long-term teams in one country.
Five ways a US company can hire in Latin America
The real difference is who finds the person, who signs the contract, who pays them and who carries the compliance risk.
| Model | Who finds the talent | Who signs and pays | Compliance risk for you | Time to start | Best for |
|---|---|---|---|---|---|
| Direct contractor | You | You, cross-border | High: misclassification, payments, IP terms | Days, once you find someone | Short projects with a person you already know |
| Employer of Record (EOR) | You | The EOR, as local employer | Low | 1–3 weeks after you find the person | Employees you already selected, in many countries |
| Remote staffing agency | The agency | The agency, under a services contract | Low | Shortlist in about 72 h, start in about 5 days with Interfell | Hiring fast without a local entity or an in-house recruiter |
| Recruiting firm (direct hire) | The firm | You, on your own entity or payroll | Yours, as employer | 2–6 weeks | Long-term roles where you already have a local entity |
| Your own local entity | You | You | Yours, plus tax and labor setup | Months to set up | Large teams in one country for several years |
What each model costs on top of the salary
Salary plus your time
No intermediary fee, but you pay in recruiter hours, payment rails, legal review of the contract and the cost of a bad hire. The risk of misclassification stays with you.
Salary plus a monthly fee and employer costs
A fixed fee per employee per month plus local employer contributions and benefits. You still have to find and vet the person.
One invoice, fee visible
80% of the monthly invoice is the professional's pay and 20% is Interfell's fee. Recruiting, contracts, local payments and compliance are included, with unlimited replacements at no extra cost while the service runs.
One-off fee per hire
A success fee when the person joins your payroll. With Interfell, a 60-day replacement guarantee. After that, employment costs are yours.
See salaries by role and country in the LATAM IT Salary Guide 2027 and the full math in cost to hire in Latin America.
Which one fits your case
- You already have the person and need them on payroll in their countryUse an EOR. If you also want help with sourcing, use remote staffing instead.
- You need to find, vet and onboard someone fast, with no entityUse remote staffing. You interview the shortlist, the agency handles contracts, payments and replacements.
- You have a local entity and want the person as your employeeUse a recruiting firm for a direct hire.
- It is a short, well-defined projectA direct contractor can work, with a clear services contract and IP clause.
- You plan 20+ people in one country for several yearsStudy a local entity, and use staffing in the meantime.
The two models Interfell offers, and when to pick each
Remote staffing
- Interfell signs the agreement with the professional, pays them in local currency and handles compliance.
- You get one monthly invoice: 80% pay, 20% fee.
- Unlimited replacements while the service runs.
- No local entity needed.
IT recruiting (direct hire)
- Interfell finds and vets; the person joins your own entity or payroll.
- One-off fee per successful hire.
- 60-day replacement guarantee.
- Best when you already employ people in that country.
Common questions
Is a staffing agency the same as an EOR?
No. An EOR employs a person you already found. A remote staffing agency also finds and vets the person, and manages the relationship and replacements.
Can I hire in Latin America without a legal entity?
Yes. With remote staffing or an EOR you do not need a local entity. See how to hire in LATAM without an entity.
What is the risk of hiring contractors directly?
If a contractor works like an employee (fixed hours, exclusivity, your tools and management), local labor authorities can reclassify the relationship, with back pay and penalties. A staffing agency or EOR carries that responsibility.
How fast can I start with remote staffing?
With Interfell, the first shortlist arrives in about 72 hours and the hire can usually start in about 5 days.
Hiring outside Latin America or comparing EOR providers globally? Our sister company Simera covers it in EOR vs contractor vs staffing platform.
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