I often look at global hiring and marvel at how agencies now move skilled professionals across Europe without the need to set up a branch or a company in each country. For years, I watched businesses wrestle with paperwork, tax codes, and countless local regulations. Yet now, with practical solutions like those I encounter at EWS Limited, it has become far more realistic for agencies and growing firms to hire in Europe with flexible arrangements instead of brick-and-mortar setups. In this article, I want to share the main “hacks” that let agencies and international firms place talent in European countries without forming legal entities, while also addressing the risks, legalities, and genuine business impact these methods bring.
A few months ago, I spoke to an ambitious HR Director struggling to understand if her company truly needed to set up a subsidiary in Sweden just to hire two developers based in Stockholm. After years watching businesses like hers, I have noticed these main drivers:
According to Eurostat’s report on part-time employment in the EU, a significant portion of European workers are either non-EU citizens or EU nationals living abroad, showing just how international the workforce has become. This trend pressures agencies to solve cross-border hiring in smart ways.
If I think back to the early 2000s, almost every agency that wanted to place talent in France or Germany would start by incorporating a local office. This meant months waiting for registrations, putting together legal representation, finding accountants, renting office space, and so on. But today, things look quite different.
Agencies and companies can now enter new labor markets, place staff directly, and run payroll efficiently by passing much of the local burden to third-party specialists. As a result, entity-free models drive faster scaling and lower up-front investment.
I will always remember one of my first experiences with cross-border hiring. The company opted to open a Polish subsidiary just to employ two software testers. By the time the first payslip was issued, legal fees exceeded three months of their salaries. Looking back, this was not unusual. Today, things have changed because each European country still has its own tangled regulations, but ways to sidestep these with smart legal channels have become more common. Here’s what makes things so complicated:
This patchwork means that agency leaders are attracted to alternatives that don’t require lengthy incorporation, but still guarantee compliance, worker protection, and payroll accuracy as expected by local authorities.
Throughout my work and research, I’ve seen four practical approaches for hiring in Europe without needing a dedicated local company. The preferred method depends on project scope, duration, and risk appetite. Below, I detail what these are and how they work in real projects.
If there’s a single method that has changed international workforce management overnight, it’s the Employer of Record. I find this process the most reliable for agencies placing full-time or long-term staff. In short, an EOR like EWS Limited assumes legal employment responsibility for a worker in the destination country, handling contracts, compliance, payroll, and terminations.
For example, EWS Limited offers Employer of Record services tailored for Denmark, Sweden, Ukraine, and Serbia, which means agencies can rely on experts to manage all statutory obligations, eliminating the need for a legal entity in Denmark, or using references for Swedish hiring, Ukrainian projects, or Serbia placements. This is the backbone of “entity-free” hiring in Europe.
Agencies stay agile, contracts stay compliant.
Second only to EOR, PEOs handle the administrative side of employment, sometimes co-employing staff and managing payroll with the agency. This is common for project teams or contractors in IT, fintech, and creative industries.
If you’re curious about differences between PEO and EOR, I recommend checking out the 2025 update on PEO vs EOR, which compares these two modes of employment, with insights for managers making their first overseas hire.
Short-term or highly specialised projects may not need an employment contract, making direct freelancing or contractor models attractive. Agencies can engage professionals as independent service providers under a B2B contract, but this comes with caveats—misclassification is a real risk, especially under European rules.
For instance, in some countries, using a contractor continuously for years could be viewed as an employment relationship. I advise agencies to seek legal advice and understand where direct contracting is safe and where it might attract penalties.
Some agencies partner with local temporary staffing firms, which “host” the employees and then assign them to work at the client’s site. This method is common in areas with high seasonal demand, e.g., hospitality or manufacturing. While it sidesteps incorporation, locally licensed partner agencies must be used, and profit margins can be lower.
This setup is often faster than starting a company but usually suits only certain industries or roles.
Every time I work on cross-border employment, the first question is always: “Is it legal to hire without a company in this country?” The answer depends on three core factors:
In most European countries, hiring through an EOR or compliant contractor setup is fully legal. Where companies sometimes go astray is by ignoring local “permanent establishment” laws or misclassifying workers, exposing the agency to fines, back pay, or reclassification.
My own practice has taught me that only using trusted, experienced intermediaries ensures compliance. With heavily scrutinized countries like Germany or France, meticulous attention to employment contracts and payroll is non-negotiable.
Every year, I see agency teams fall into these classic traps. Avoid them, and your placements will be much smoother and less risky.
Europe takes worker protection seriously—contracts, sick leave, maternity leave, social insurance, and terminations, all with strict legal backing. Using a standard contract can leave you exposed to claims, as laws can override any agreement if protections are missing.
If you have people working in a country full-time and making money for your agency there, the tax authority could say you have a hidden branch and demand retroactive company taxes. Structures like the EWS Limited EOR model are designed to shield you from this risk, but it needs careful management.
Agencies sometimes hire long-term staff as “contractors” to avoid employment laws, but this can backfire if authorities believe they were really employees. Penalties are heavy—always check each country’s rules on allowable contractor arrangements.
Regulations change every year and can vary dramatically even within regions. For example, according to recent Eurostat findings, employment rates vary between European regions, reflecting local economic and legal factors. Entities like EWS Limited make it easier to stay ahead of these shifts with up-to-date support.
Workers who move between countries or work remotely from another country must have proper social security coverage and contributions, both to protect them and to avoid double taxation. EU rules help, but each country has variations worth checking in advance.
Think global, but act in line with local laws.
When I help clients on cross-border hires, payroll is often the area that sparks the most concern. Each country asks for specific payroll calculations, and paying into local bank accounts or calculating the right taxes can be daunting. Here’s how agencies handle payroll in a borderless hiring model:
This arrangement means agencies can expand their workforce as if they had a local office, but without any permanent presence, registration, or local bank account. It’s one of the biggest reasons the EOR approach is skyrocketing in popularity.
In my experience, the best approach depends on your project’s specific requirements, level of risk you are willing to take, and the size of your potential footprint in the country. Consider these factors before choosing a solution:
For long-term or multiple placements, I strongly recommend the EOR model as the most stable. For short-term projects, direct contracting may be fine, provided you consult legal guidance first.
Some months ago, I guided a Series B IT company ready to expand into Sweden but hesitant to create a Swedish entity for just five engineers. By partnering with EWS Limited on an EOR arrangement, they hired all five engineers with permanent contracts under Swedish law, managed payroll in SEK, and provided benefits equal to local peers. No new company, no local office, and full compliance. They could focus on their product launch while the EOR managed every legal and HR process. This kind of agility is game-changing for growth companies.
Europe faces one of its toughest skills shortages in decades, with 80% of employers unable to find the skills they need, according to recent data from Eurofound. For agencies, this means reaching beyond borders for the best talent—without waiting to register companies for every placement. The entity-free model enables teams to source developers, cybersecurity experts, and project managers from right across the continent, adapting quickly to market needs. Not only does this keep the business moving, it also supports talent from underrepresented regions to join pan-European teams.
I believe mobility is more than just moving workers—it’s about aligning company vision with the best talent, regardless of location. Whether you are a relationship manager at a multinational or a founder of a startup, the freedom to hire flexibly provides an edge. EWS Limited, as a partner, offers tailored consulting for each country, covering everything from legal compliance checks to payroll outsourcing and complete workforce relocation support.
Based on what I’ve seen, the agencies and startups that thrive in this new landscape focus on:
Above all, the willingness to seek expert guidance—like what EWS Limited provides—ensures risks are kept low and growth is sustainable across Europe’s shifting labor landscape.
For agencies and growing firms, the opportunity to hire across Europe without forming a company in every new market is no longer a pipe dream. EOR, PEO, and contract-based approaches have made borderless hiring quick, compliant, and cost-effective. The strategies I’ve shared above reflect the best practices I see among successful agencies today—practices that EWS Limited has refined in real-world projects over years. If you want to discover more about how to streamline your own European workforce expansion, reach out to EWS Limited to see how our solutions empower you to hire talent anywhere your ambitions take you.
Hiring in Europe without an entity means placing a worker in a European country without forming a legal company or branch office there. This is achieved through third-party partners such as Employer of Record (EOR) services, Professional Employer Organisations (PEOs), or legal direct contracting models. This approach lets agencies or companies operate in a country, manage local payroll, and comply with labor laws, all without the burden of company registration.
Agencies hire without forming a local entity by partnering with specialist providers who take on the employment and compliance responsibilities in the destination country. The most common solutions are EOR arrangements, where the service provider becomes the legal employer, and PEO services, where HR administration is outsourced with shared responsibility. For short projects, agencies sometimes engage contractors directly, but care must be taken to avoid misclassification.
Yes, it is legal to hire in Europe without an entity, as long as you use approved channels like EOR, PEO, or compliant contractor agreements. The primary risk is breaking “permanent establishment” rules or misclassifying workers as contractors. Working with experienced partners like EWS Limited helps keep agencies on the right side of local laws and regulations.
The main benefits include: quicker entry into new markets, lower upfront and operational costs, reduced administrative and legal burdens, and more agility to place or remove talent as projects change. It also helps businesses manage risk, maintain compliance, and trial new regions without long-term commitments or costly local company setups.
Costs depend on the method used. EOR and PEO solutions typically charge a monthly fee per worker, which can include payroll, contracts, and HR support (sometimes between 5% to 20% of gross salary). Contractor models carry fewer fixed costs but may hold legal risks. Compared to the expense and time of forming a local entity, these solutions almost always provide a more affordable, flexible alternative, especially for initial hires or project-based placements.
GCC Hiring Compliance Update: What’s Changing in 2026
How to Hire in Turkey in 2026: A Strategic EOR Guide
Why modern recruitment agencies outsource compliance to EOR partners
How adding an EOR partner helps agencies win more RFPs
EOR Opportunities in Poland: Why It’s Europe’s Talent Powerhouse
Cross-Border Hiring Trends for 2026: Insights for Global Recruiters
How to Build a Scalable Payroll Strategy Across MENA
Contractor vs Employee in Germany: What’s the Risk in 2026?
“Place globally, bill locally” — the new recruiter cheat code
Top 5 Compliance Mistakes When Expanding to the UAE
Why EOR is Key to Winning Public Sector Tenders in Europe
Growth formula for agencies using EOR to expand key accounts
How EOR helps recruiters stay ahead of fast-changing GCC compliance
Employer of Record in Mandarin: What is 境外雇主服务？
How to Use an EOR for Temporary Projects (中国公司如何为短期海外项目使用EOR服务)
Why “Go Global” Must Include Compliance (“走出去”战略中的合规盲点)
中资企业如何选择欧洲EOR供应商？(How to Choose the Right EOR Partner in Europe)
与当地政府打交道：中国公司需要了解的合规礼仪 (Cultural Compliance for Chinese Firms)
中国公司海外人力结构案例分析：制造业、科技与能源 (HR Case Studies: Chinese Firms Abroad)
How Guanxi Influences Hiring in the Middle East (关系在中东招聘中的作用)
Top 5 Risks When Hiring in the Gulf (中国企业在海湾地区招聘的五大风险)
Managing Compliance in Multi-country Projects (中国企业多国项目的人力合规管理)
The $100K Visa Shock: Why Global Hiring Just Replaced the H-1B
How to Set Up Payroll For Hpc And Ai Teams
Contracting Machine Learning Talent Abroad
Everything on Hiring Foreign Phds In German Tech Labs
Cross-Border Ip Protection In R&D Teams
How To Classify Freelancers In Tech Innovation
How Eor Helps Tech Firms Legally Hire In Germany
Dual Contract Structure For International Researchers
Data Protection Obligations For Remote Tech Staff
Germany Research Visa Vs Skilled Worker Visa
Everything on Nis2 Directive Compliance For Eu Tech Workers
Global Mobility For Deep Tech Startups In Germany
Payroll For EU Embedded Systems Developers
Relocation Support For Semiconductor Experts on EU
The Absolute Way to Hire Ai Engineers In Germany
How to Manage Benefits For German Tech Hires
Germany’S Blue Card Process For Engineers
Everything on Germany R&D Employment Compliance
Remote Hiring Of Cybersecurity Analysts In Eu
Visa Pathways For Quantum Computing Researchers
Onboarding Robotics Specialists Across EU Borders
Workforce Planning In Ai-Driven Logistics And Infrastructure
Visa Processing For High-Tech Infrastructure Staff
Managing Global Mobility In Sustainable City Projects
Cross-Border Team Management In Saudi Data Centers
Hiring Skilled Labor For Green Hydrogen Facilities
Digital Twin Technology Hiring Trends In Saudi Construction
Employer Obligations In Public-Private Energy Initiatives
Navigating Local Labor Laws For Solar Energy Teams
Talent Acquisition In The Saudi Mining Sector
Eor Solutions For Ai Engineers In Mega Projects
Regulatory Challenges In Hiring For Giga Construction Projects
Contractor Compliance In Smart City Developments
Classification Of Engineering Consultants In Vision 2030 Projects
How To Manage Workforce For Neom-Based Tech Projects
Eor For Multinational Mining Firms Operating In Saudi Arabia
Employer Of Record For Wind Energy Projects In The Gulf
Relocation Logistics For International Clean Energy Experts
Hiring Strategies For Large-Scale Construction Projects In Ksa
How To Onboard Digital Infrastructure Experts In Saudi Arabia
Payroll Setup For Renewable Energy Workers In Ksa
Strategic Relocation To Riyadh Or Doha: A Guide for Global Employers
Work Visa Processing In Qatar And Saudi Arabia
Qatar Nationalization Policy And Foreign Firms
Cost Of Setting Up A Business In Qatar: A Guide for Global Employers
Saudi Labor Court And Dispute Handling for Global Employers
Cross-Border Payroll For Ksa And Qatar Teams
End Of Service Benefits Saudi Arabia: A Guide for Global Employers
How To Manage Expat Benefits In Qatar for Global Employers
Expanding Into New Markets: Vendor Risks You Should Flag
A Guide to Cross-Border Equity Vesting for Tech Startups
Employer Branding for Multinational Teams: What Works Now
What Global C-Level Leaders Miss About Digital Nomad Visas
Succession Planning for Distributed Teams: A Practical Guide
Relocation Budgeting For Global Tech Firms
Latam Hiring Strategy: What Global Companies Should Know
Risk Of Permanent Establishment Explained
Managing Intellectual Property In Remote Work
Benefits Benchmarking Globally for Global Companies
How to Benchmark Compensation Across 100+ Countries in 2025
Checklist: Preparing HRIS for Fast International Scalability
Biometric Data in Global Payroll: Legal Boundaries Explained
8 Regulatory Updates Impacting Global HR in 2025
What are Hidden Costs of In-House Payroll?
Why Companies are Thinking Differently About Relocation
Is Your Global Mobility Program Outgrowing Spreadsheets?
Remote Work Visas: A Growing Trend in Global Mobility
Hiring in Europe Post-Brexit: What You Need to Know
Tips for Managing Multi-Time Zone Teams Successfully
Relocation Packages: What Top Talent Expects in 2025
Banking and Payroll Challenges in Saudi Arabia Markets
The Legal Risks of Misclassifying Global Workers
Why Scalability Should Drive Your Global HR Strategy
How EWS Streamlines Global Mobility for Tech Talent
Lithuania – Employer of Record
Kosovo – Employer of Record
Finland – Employer of Record
Namibia – Employer of Record
Nepal – Employer of Record
Spain – Employer of Record
Latvia – Employer of Record
Ireland – Employer of Record
Cyprus – Employer of Record
Czech Republic – Employer of Record
Italy – Employer of Record
Indonesia – Employer of Record
South Africa – Employer of Record
Tunisia – Employer of Record
Bosnia – Employer of Record
Moldova – Employer of Record
Five Tips For Improving Employee Engagement
Netherlands – Employer of Record
Germany – Employer of Record
France – Employer of Record
Portugal – Employer of Record
Bulgaria – Employer of Record
Austria – Employer of Record
Hungary – Employer of Record
Slovenia – Employer of Record
INCLUSIVITY IN THE TEAM MAKES EVERYONE WIN
Thailand – Employer of Record
Sri Lanka – Employer of Record
The Significance of an Employer of Record
Greece – Employer of Record
Mexico – Employer of Record
4 Reasons to Outsource Your Payroll
Five Recruitment Trends 2023
Malaysia – Employer of Record
Skill-Based Hiring and Benefits
Malta – Employer of Record
How To Practice Inclusive Recruitment
Israel – Employer of Record
Macedonia – Employer of Record
Jordan – Employer of Record
Macau – Employer of Record
Peru – Employer of Record
The Importance of Employer Branding
Bahrain – Employer of Record
South Korea – Employer of Record
Recruiting during a recession
Philippines – Employer of Record
USA – Employer of Record
Japan – Employer of Record
How To Setup A Business in 2023
Norway – Employer of Record
Managing Overseas Projects In 2023
Reason Of Expanding Your Workforce Globally
Croatia – Employer of Record
Colombia – Employer of Record
5 Ways To Speed Up Your Hiring Process
Egypt – Employer of Record
3 Ways To Streamline An Interview Process
Russia – Employer of Record
Saudi Arabia – Employer of Record
Hong Kong – Employer of Record
An Effective Hybrid Work Model
Turkey – Employer of Record
UAE – Employer of Record
Pakistan – Employer of Record
7 Things to Consider Before Accepting a Job
Kazakhstan – Employer of Record
3 Reasons to Encourage Employees to Generate Employer Brand Content
Denmark – Employer of Record
Sweden – Employer of Record
Bangladesh – Employer of Record
Kuwait – Employer of Record
How To Hire In The Age Of Hybrid Working
Australia – Employer of Record
Oman – Employer of Record
Qatar – Employer of Record
Ukraine – Employer of Record
Diversity – A Vital Hiring Strategy
Owning Every Moment of Your Hiring Experience
Serbia – Employer of Record
Maldives – Employer of Record
India – Employer of Record
Argentina – Employer of Record
Uzbekistan – Employer of Record
Belarus – Employer of Record
Brazil – Employer of Record
Chile – Employer of Record
Armenia – Employer of Record
3 Steps To Company Formation In The UK & Abroad
Romania – Employer of Record
Canada – Employer of Record
Morocco – Employer of Record