Every other week someone in the ALIENs squad chats asks 'should I take the EoR or the contractor offer?'. This is the long answer, condensed.
The headline difference
| Dimension | EoR | Contractor |
|---|---|---|
| Who employs you | Local EoR entity | You / your sole prop |
| Tax withholding | Done for you | You file |
| Social insurance | Usually included | On you |
| Health insurance | Usually included | On you |
| Equity eligibility | Often yes | Rarely |
| Paid leave | Statutory minimum | None |
| Termination notice | Local labor law | Per contract |
| Setup time | 1–3 weeks | 1 day |
If a contractor offer is only 5% above an EoR offer, you're almost certainly losing money once you price benefits and unpaid leave.
When contractor still wins
- You already have a registered freelance entity with optimized tax
- You're working <20 hrs/week or for multiple clients
- The company has no EoR coverage in your country
- You explicitly don't want long-term employment ties
What to ask before signing EoR
- Which provider? (Deel, Remote, Oyster, Multiplier, Plane)
- Who pays the EoR fee — does it reduce your offer?
- What's the notice period after probation?
- Are equity / RSUs offered, and through what mechanism?
- Health: who's covered (dependents?), what's the deductible?
- Is there a 13th-month or end-of-service gratuity?
"I switched from contractor to EoR mid-2025 — same base, but the health and statutory PTO were worth ~$700/mo I wasn't pricing."
Red flags in contractor agreements
- Non-compete clauses (often unenforceable but messy)
- IP assignment going beyond work product
- 30-day payment terms (push for 7–14)
- Unilateral rate-change clauses
- Mandatory arbitration in a foreign jurisdiction
Run any contract through AALN's contract review (Job Tools → Contract Check) before signing. It flags 80% of the red flags above automatically.