# How to hire senior Latin American talent without a local entity Source: https://www.tessera.partners/insights/hire-latin-american-talent-without-local-entity Language: en Last updated: 2026-10-02 Insight You can hire senior Latin American talent without opening a local company. Most firms choose between an employer of record, which employs the person for you, and a contractor agreement, which only fits genuinely independent work. The right choice depends on control, cost, country rules and how long you plan to stay. Published October 2, 2026 · Updated October 2, 2026 · By [Federico](https://www.tessera.partners/team/federico) ## What are your options if you have no entity? There are three ways to hire someone in a country where your company has no legal presence. Each one changes who the legal employer is, what you pay and how much risk you carry. | Option | Who employs the person | Best for | Watch out for | | --- | --- | --- | --- | | Employer of record (EOR) | The EOR, under a contract with you | One to a few hires in a country, full-time roles | A monthly fee per person on top of salary and employer costs | | Contractor agreement | Nobody: the person invoices you as an independent | Project work with real independence | Local rules may treat the person as an employee | | Your own entity | Your local company | Several long-term hires in one country | Setup time, accounting and ongoing compliance | An EOR is the most common starting point for senior, full-time roles. You choose the person and manage the work. The EOR signs a local employment contract, runs payroll and handles benefits and taxes. If you are building a team this way, see how our [remote hiring services in Latin America](https://www.tessera.partners/services/remote-hiring-latin-america) work alongside your EOR. ## When is a contractor agreement the wrong choice? A contractor agreement looks simple, but it only works when the person is truly independent. If you set their hours, supervise them closely and treat them like the rest of the team, local law may see an employee. The rules differ by country. In the US, the IRS looks at behavioral control, financial control and the type of relationship ([IRS guidance](https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee)). Argentina's Employment Contract Law presumes an employment contract when someone works under another's direction ([Law 20,744, article 23](https://servicios.infoleg.gob.ar/infolegInternet/anexos/25000-29999/25552/texact.htm)). Brazil's CLT defines an employee by continuous, subordinate and paid work, and voids arrangements meant to avoid it ([CLT, articles 3 and 9](https://www.planalto.gov.br/ccivil_03/decreto-lei/del5452.htm)). For a senior, full-time hire who leads people or owns a number, an EOR or your own entity is usually safer. This is a legal question, so confirm it with a lawyer before you decide. ## What does each option cost? Compare the full cost, not only the salary. With an EOR, you pay the salary, the employer costs required by local law and the provider's monthly fee. Each provider publishes its own pricing, so ask for a quote for the specific country. With a contractor, you pay an invoice, often in US dollars or euros. It looks cheaper, but the risk of reclassification has a cost too. With your own entity, the monthly cost per person falls, but you pay for setup, accounting, legal advice and someone to run local compliance. Recruitment is a separate cost from employment. A recruitment partner finds and assesses the person, and charges once. At Tessera Partners, the fee is 10% of the first year base salary, with a 750 EUR start fee deducted from the final invoice. ## How do you find and assess someone you cannot meet locally? Without a local team, you cannot rely on office visits, local references you know or a gut feeling over coffee. You need a structured process that works at a distance. - Write a clear brief: results expected in the first year, the team, the stage and the salary band. - Source through referrals and trusted networks, not only job boards. Senior people who perform well rarely apply. - Test written English on real work, such as a short update to a leader. Remote roles live in writing. - Check references with former managers, and ask about results, not personality. - Confirm early that the candidate accepts the employment model you plan to use. ## When should you open your own entity? An entity makes sense when you plan several long-term hires in the same country, or when the business itself operates there. It also matters for tax. In some cases, staff working abroad can create a taxable presence for your company, known as a permanent establishment. Article 5 of the OECD Model Tax Convention defines the concept ([OECD Model Tax Convention, 2025](https://www.oecd.org/content/dam/oecd/en/publications/reports/2026/06/model-tax-convention-on-income-and-on-capital-2025-full-version_4fd97b89/db32e18b-en.pdf)). Many companies start with an EOR for the first hires and move to their own entity once the team grows. Plan that move early, because transferring employees between employers has its own rules. ## What changes for the candidate? Senior candidates compare offers on more than salary. The employment model changes their benefits, their job security and how they feel about the company. With an EOR, the candidate gets a local employment contract with the benefits and protections of their country. Many senior people prefer this, especially if they have a family. With a contractor agreement, they gain flexibility and often a payment in a strong currency. In exchange, they handle their own taxes and have fewer protections. With your own entity, they become a direct employee, which signals a long-term commitment from the company. We have seen strong finalists decline at the last step because nobody explained the model. Explain it in the first conversation and put it in the job brief. Candidates who understand it early make better decisions, and you avoid losing a finalist at the offer stage because of a detail nobody mentioned. Also think about equity. If you offer stock options, check how the plan works for people employed through an EOR or paid as contractors in another country. ## Checklist before you make an offer - The employment model is decided and confirmed with a lawyer or your EOR. - The salary band is set in the right currency and shared with the candidate. - The candidate accepts the model: EOR employee, contractor or local employee. - The start date accounts for the candidate's notice period. - Equipment, access and onboarding are ready for a remote first week. - A 30, 60 and 90 day check-in plan is in the calendar. ## What we see in real searches In our searches, the decision about the employment model often comes too late. Companies find a strong candidate and only then ask how to employ them. The offer stalls while legal and payroll catch up, and good candidates accept other offers. The companies that hire best decide the model before the search starts. They also tell candidates early, because senior people care about it. A contractor role and an EOR employment contract feel very different to someone with a family and a mortgage. We also see that the first hire in a country sets the standard for the next ones. When that person is strong and well supported, the second and third hires come faster, often through their referrals. ## About the author [Federico](https://www.tessera.partners/team/federico) Federico is Co-Founder of Tessera Partners. He spent nearly 10 years in international corporate banking, including J.P. Morgan and Barclays. He leads searches for clients in EMEA, the US and Spanish-speaking markets. ## Keep reading - [Remote hiring services in Latin America](https://www.tessera.partners/services/remote-hiring-latin-america) - [Recruitment agency vs EOR](https://www.tessera.partners/recruitment-agency-vs-eor) - [Recruitment fees](https://www.tessera.partners/recruitment-fees) ## Planning a hire in a country where you have no entity? [Book a call →](https://cal.com/tessera)