Talent Acquisition - Case Study
Finding the Right EoR: How One Tech Cut Monthly Employment Costs by 60% By Moving Their Spanish Team to the Right EoR
The Situation
A fast-growing Swiss fintech had been working with five Spanish consultants for four years, hired out through a local Spanish IT firm. The commercial case for bringing them on as direct employees was clear — strong engineering talent, lower salary costs than Switzerland or Germany, and a time zone that worked well for the team.
The problem was the existing arrangement had stopped working. The Spanish IT firm was increasingly unresponsive, handled communications with the consultants poorly, and operated with no clear invoicing schedule — meaning the fintech never quite knew what they would be billed or when. After four years of tolerating the arrangement, the leadership team decided it was time to take ownership of the employment relationship directly. What they did not know was how to do that compliantly without a Spanish legal entity of their own.
That is when they called us.
What we found
We ran a structured evaluation of six EoR providers against a framework covering eight criteria: local compliance track record in Spain, termination process and legal risk allocation, pricing transparency and total cost of employment, benefits administration quality, customer service responsiveness after signing, technology and reporting capabilities, contract terms and liability clauses, and references from clients who had actually used them in Spain specifically — not just globally.
The findings were more significant than the client expected
1
On pricing:
The provider the CEO had been about to sign with had a headline rate that looked competitive. Once we added the mandatory Spanish social security contributions, the platform fee, the onboarding charge per employee, the benefits administration markup, and the annual salary review fee, the true monthly cost per employee was 40% higher than the headline figure suggested. Three of the six providers had similar structures — attractive headline rates with significant additional charges buried in the commercial schedule.
2
On termination:
Spain has some of the most employee-protective termination law in Europe, which means any EoR operating there needs to hold adequate financial reserves to cover potential severance obligations. How providers structured this varied significantly — and the differences were significant enough to make or break the business case for a startup.
3
On local expertise:
Two of the six providers listed Spain as a supported country but were operating through a local partner rather than their own entity. Having a local entity is not automatically an advantage — what mattered far more to us was whether the provider had real, on-the-ground HR expertise in Spain rather than a consultant sitting in a London office who happened to cover the Iberian peninsula alongside six other markets.
The provider we ultimately recommended was not the cheapest or the most recognisable name in the market. What it had was more important than either of those things: its own Spanish entity, a strong track record on terminations, a fully transparent pricing model with no hidden charges, and — critically — a dedicated local HR contact based in Spain who knew the five employees by name within the first week of onboarding.
The Negotiation
Armed with a detailed comparison across all six providers, the client had significant negotiating leverage. We supported the contract negotiation directly, focusing on three areas:
The monthly fee per employee was reduced from €399 to €250. The annual salary review administration charge was removed entirely. The final fully loaded monthly cost per employee came in at 60% below the of the current cost without compromising on compliance quality or local support.
What happened next
Five Spanish hires were moved to the EoR within eight weeks of our initial engagement. The process — contracts, payroll setup, benefits enrollment, and right-to-work documentation — ran without issues. The local contact at the EoR responded to queries within the same business day throughout.
Beyond the immediate hires, the evaluation process produced something with lasting value: a reusable EoR assessment framework, a full cost modelling template, and a set of contract red flags that the client has since applied when evaluating providers for two further markets.
The takeaway
The EoR market is crowded and the pricing is deliberately opaque. The difference between the right provider and a hastily chosen one is not always visible on the website — it shows up in the termination clause, the support ticket response time, and the line items nobody mentioned during the sales call.
Taking eight weeks to choose properly saved this client money from month one and removed a significant legal risk before it had a chance to become a problem.