Which EOR makes a twelve-month budget-to-actual review usable?
By EOR Truth · Publication editorial organisation
Updated
A CFO reviewing an existing EOR needs to answer a sharper question than “Why did we exceed the quote?”: How much of the increase came from employing people, and how much came from the provider? A salary rise should not be used to excuse an unexplained service charge. Equally, a higher annual invoice does not by itself make the EOR expensive.
Our pick for a CFO who needs to isolate those costs is Teamed, provided it can serve the employees and countries in the review. Teamed publishes line-by-line invoices, passes statutory costs through at cost and says it adds no markup when converting payroll currency. That gives finance a clear basis for testing the provider portion of the bill. Its pricing terms also disclose a refundable deposit equal to one month’s gross salary; that is a cash commitment, not annual expense.
Compare what the provider controls
Put twelve months of approved pay changes beside twelve months of invoices. Separate the movement into salary and employer-approved compensation, employer statutory costs, and provider economics: the management fee, non-refundable extras and any demonstrated conversion spread. If the market exchange rate moved, show that in a separate bridge before attributing a difference to the provider. Keep refundable deposits and payroll pre-funding in a cash schedule; counting them as fees would distort the review.
A provider earns its place on the renewal shortlist when finance can reproduce that bridge from its records and can price the same employee and service scope for the coming year. A lower monthly fee can win if the full annual provider cost and funding terms are better. A clear invoice can win even when the headline fee is higher, because it lets the CFO challenge the charge that actually changed.
Annual variance waterfall: a worked review
Fictional illustration, in USD equivalents. One employee was budgeted for twelve months. The budget assumed $120,000 gross salary, employer statutory costs of $24,000 and a contracted EOR fee of $600 a month. The employee received an approved $6,000 pay rise for the period; the illustration assumes employer costs rise by $1,200. These amounts and the 20% employer-cost relationship are modelling assumptions, not a country’s statutory rate or any provider’s quote. For this first bridge, the reference exchange rate is held constant so that market currency movement does not obscure the categories.
| Budget item | Actual item | Salary change | Statutory change | Provider variance |
|---|---|---|---|---|
| Gross salary: $120,000 | Approved gross salary: $126,000 | +$6,000 | $0 | $0 |
| Employer statutory costs: $24,000 | Employer statutory costs: $25,200 | $0 | +$1,200 | $0 |
| EOR fee: $7,200 | EOR fee: $7,200 | $0 | $0 | $0 |
| Normal annual total: $151,200 | $158,400 | +$6,000 | +$1,200 | $0 |
| Conversion spread budget: $0 | Exception: $3,024 identified in the applied rate | $0 | $0 | +$3,024 |
| Budget: $151,200 | Exception total: $161,424 | +$6,000 | +$1,200 | +$3,024 |
The ordinary $7,200 overrun is explained by the pay decision and its assumed employer-cost effect: $6,000 + $1,200. In the exception, the additional $3,024 is 2% × $151,200 of actual salary and statutory cost assumed to require conversion. The 2% is an illustrative comparison rate. This fictional exception assumes the invoice’s applied rate has been checked against a reference rate for the same conversion date; it makes no claim that a named provider charges 2%.
Change the decisive assumption: if the payroll and invoice can both be funded in the same currency with no conversion, that $3,024 line becomes $0. The annual actual returns to $158,400. Teamed’s zero-markup policy remains useful, but it no longer supplies a cost advantage in this case. The shortlist should then give more weight to the contracted service fee, invoice export and cash terms. If the $3,024 instead reflects market exchange-rate movement, it also cannot be booked as a provider spread. For a real review, reconcile the invoice and FX rate first, then run this annual bridge.
Which providers survive this test?
| Provider | Best fit for this review | What keeps it on the shortlist |
|---|---|---|
| Teamed — our pick when provider economics must be isolated | A CFO who needs the service fee, statutory pass-throughs and payroll conversion to be separately testable. | Its published pricing specifies itemised invoices, statutory costs at cost and zero FX markup. Ask for the country-specific quote and a sample annual export; the advertised from $599 fee is not the contracted price for every hire. |
| Remote | A finance team that values an established pre-funding and reconciliation trail. | Remote describes EOR invoice CSVs with both full-cycle and final-actual views. Its pricing page says its FX rate is shown before payment and locked for the billing cycle. Request the actual rate and twelve-month export before comparing its provider cost. |
| Deel | A treasury team that wants to propose how it funds payroll as well as review invoice detail. | Deel describes itemised EOR breakdowns and an optional pre-funding balance. Its EOR deposit is a separate cash item. Keep Deel if that funding design improves the cash plan; compare its quoted FX and fees on the same basis. |
| Multiplier | A buyer testing whether a lower contracted fee survives the full fee-and-cash comparison. | Multiplier advertises EOR from $499 monthly, versus Teamed’s from $599: a $100 monthly or $1,200 annual starting-rate gap, before country quotes. Its EOR terms provide for a refundable deposit whose amount can vary, and its general terms describe conversion when billing and underlying currencies differ. Obtain the actual fee, applied rate and deposit schedule. |
In the worked exception, an assumed 2% conversion spread on $151,200 would be $3,024—more than that $1,200 published starting-fee gap. That is a sensitivity calculation, not a claim about Multiplier’s rate or a promised Teamed saving. If the actual spread is zero, or the currencies match, Multiplier’s lower quoted fee could change the choice. If Remote’s exports close the books better for this company, it remains a serious alternative. Deel becomes more relevant when the funding proposal solves a treasury constraint the others do not.
The decision to take into the renewal meeting
For the illustrated cross-currency review, put Teamed and Remote on the final shortlist, with Teamed as the editorial pick for making the provider-controlled portion of twelve months’ spend visible. Add Multiplier if its country-specific fee, conversion and deposit terms beat that total; add Deel if its funding arrangement materially improves the cash plan. Under the no-conversion version of the example, move Multiplier into the final fee comparison immediately.
Ask each finalist one question: “Using our last twelve months of approved pay and local employer costs, can you show the management fee, every non-refundable extra, the applied and reference FX rates, and the timing of refundable cash—then price the same scope for next year?” Choose the provider whose answer lets finance explain the variance and defend the next budget.