Global Payroll Services in Turkey:Automated & Compliant MUHSGK Tax Management
Turkey Payroll Starts With SGK, Not Just Net Salary
Payroll in Turkey is shaped by a layered calculation system. Employers must calculate gross salary, employee SGK, employee unemployment insurance, income tax based on cumulative taxable income, stamp tax, employer SGK, employer unemployment insurance, minimum wage exemptions, payslips, monthly declarations, and employee lifecycle records. For foreign-owned companies, the operational challenge is often not one single payroll rate, but making every payroll input match Turkish tax, social security, and labor-law logic before the pay run is approved.
NNRoad provides Turkey payroll services for companies that already have a local employer structure in Turkey, such as a Turkish legal entity, branch, subsidiary, or representative office permitted to employ staff directly. Your company remains the legal employer, while NNRoad supports monthly payroll calculation, reporting coordination, statutory deduction handling, payroll documentation, and local payroll compliance workflow.
Best-fit employers for this Turkey payroll service
- Foreign-invested companies with a Turkish entity that need monthly payroll outsourcing.
- Regional HR teams managing Turkey employees from outside the country.
- Finance teams that need a clear view of gross salary, net salary, employer SGK cost, unemployment insurance, and payroll tax liabilities.
- Companies hiring in Istanbul, Ankara, Izmir, Bursa, Kocaeli, Antalya, or other Turkish business hubs.
- Employers replacing manual payroll spreadsheets with a controlled monthly payroll calendar.
- Companies that need payroll support for Turkish employees, foreign employees, leavers, bonuses, allowances, and severance cases.
Where payroll outsourcing ends and employment structure begins
Payroll outsourcing is designed for an employer that already exists locally. If your company does not have a Turkish entity but wants to hire an employee in Turkey, payroll calculation alone will not solve the legal employer issue. In that case, review NNRoad’s Turkey Employer of Record service. If the case involves a foreign national working in Turkey, payroll should also be aligned with work permit and immigration requirements through Turkey Expat Employment services.
For companies managing Turkey as part of a wider international workforce, Turkey payroll can also be integrated into NNRoad’s Global Payroll service, helping headquarters review local payroll reports across multiple countries in a consistent format.
The Turkey Payroll Calculation Stack: Gross Pay, SGK, Tax, Stamp, Net Pay
Turkey payroll is best understood as a calculation stack. Each layer depends on the previous one. If the SGK base is wrong, the income tax base may also be wrong. If the cumulative tax base is not tracked correctly, the employee’s later-month net salary may change unexpectedly. If the basic salary and allowances are not separated clearly, severance and final settlement calculations may be affected.
Core monthly calculation layers
| Payroll layer | What is calculated | Why it matters |
|---|---|---|
| Gross salary and additions | Base salary, allowances, bonuses, commissions, overtime, premiums, and other wage-like payments. | These items drive SGK base, income tax base, stamp tax, net pay, and employer cost. |
| Employee SGK and unemployment insurance | Employee-side social security and unemployment deductions based on the applicable contribution base. | These reduce employee net pay and usually reduce the income tax base. |
| Income tax | Progressive tax calculated using cumulative taxable wage income and the minimum-wage exemption mechanism. | Net salary can change during the year when the employee moves into higher tax brackets. |
| Stamp tax | Payroll-related stamp tax on wage documents, after applying the relevant minimum-wage exemption where applicable. | Stamp tax is smaller than income tax but still affects net pay and payroll reporting. |
| Employee net salary | Gross salary minus employee deductions, income tax, stamp tax, and lawful payroll deductions. | This is the amount employees usually compare against their employment offer or monthly expectation. |
| Employer SGK and unemployment insurance | Employer-side SGK premium and unemployment insurance, with incentive treatment where applicable. | This is a major employer-side cost and should be shown separately from employee deductions. |
What NNRoad supports in the monthly pay run
- Monthly gross-to-net and net-to-gross payroll calculations.
- Employee SGK, unemployment insurance, income tax, and stamp tax calculation.
- Employer SGK and unemployment insurance cost reporting.
- Payroll reports for HR, finance, and management approval.
- Payslip preparation and employee-facing payroll summaries.
- Support for new hires, leavers, salary changes, bonuses, allowances, overtime, unpaid leave, and final settlements.
- Payroll records aligned with monthly declaration and reporting requirements.
Why Turkey payroll should not be copied from another country template
Turkey payroll has its own cumulative income tax mechanics, minimum-wage exemption logic, SGK contribution base limits, sector-based SGK incentive differences, and termination-payment rules. A payroll model built for another country may produce the wrong net salary, wrong employer cost, or wrong declaration values.
2026 Turkey Payroll Parameters That Change Employer Cost Planning
For 2026 payroll planning, employers should update minimum wage, SGK contribution base, employer premium discount assumptions, and payroll-tax exemption logic before preparing salary offers or annual budgets. Turkey’s payroll parameters can materially change both employee net pay and total employer cost.
2026 minimum wage and SGK base references
| Item | 2026 reference | Payroll use |
|---|---|---|
| Daily gross minimum wage | TRY 1,101.00 | Used for payroll floor and daily salary-related calculations. |
| Monthly gross minimum wage | TRY 33,030.00 | Minimum monthly gross salary reference for full-time employees. |
| Monthly net minimum wage | TRY 28,075.50 | Net result after employee SGK and unemployment deductions, with no income tax or stamp tax on the minimum-wage salary. |
| Monthly SGK contribution base floor | TRY 33,030.00 | Lower contribution base reference for standard payroll calculation. |
| Monthly SGK contribution base ceiling | TRY 297,270.00 | Upper monthly contribution base reference for SGK premiums in 2026. |
Employer-side contribution scenarios
| Employer SGK scenario | Employer SGK rate | Employer unemployment insurance | Payroll planning note |
|---|---|---|---|
| Manufacturing-sector 5-point incentive applied | 16.75% | 2% | May apply where the employer and payroll conditions meet the relevant incentive requirements. |
| General 2-point SGK discount applied | 19.75% | 2% | Common planning basis for eligible non-manufacturing employers that meet required conditions. |
| No SGK discount applied | 21.75% | 2% | Used where the employer is not eligible or does not satisfy incentive conditions. |
Why incentives should be checked before budget approval
Employer SGK incentives can change the employer cost of the same gross salary. A company that assumes a 2-point or 5-point discount without checking eligibility may under-budget payroll costs. A company that ignores available incentives may overstate employment cost. Payroll setup should confirm sector, employer status, payment discipline, SGK debt position, and incentive eligibility before applying a discounted employer rate.
Official payroll reference links
Employers can review the Turkish Ministry of Labour’s 2026 minimum wage and employer cost table, the Social Security Institution at sgk.gov.tr, and the Revenue Administration at gib.gov.tr when maintaining payroll parameters.
Cumulative Income Tax and the Minimum Wage Exemption
Turkey payroll uses cumulative income tax. This means payroll should track the employee’s taxable wage base during the year, not only the current month’s salary. As taxable income accumulates, the employee may move into higher tax brackets, and net pay may decline even if gross salary remains unchanged.
2026 employment income tax brackets
| Annual taxable employment income | 2026 income tax treatment | Payroll note |
|---|---|---|
| Up to TRY 190,000 | 15% | Lower bracket for early-year or lower taxable income. |
| TRY 190,000 to TRY 400,000 | TRY 28,500 on the first TRY 190,000, then 20% on the excess. | Payroll should track when the employee crosses this threshold. |
| TRY 400,000 to TRY 1,500,000 | TRY 70,500 on the first TRY 400,000, then 27% on the excess. | This employment-income bracket is wider than the non-employment-income bracket. |
| TRY 1,500,000 to TRY 5,300,000 | TRY 367,500 on the first TRY 1,500,000, then 35% on the excess. | Commonly relevant for senior managers, expatriates, sales roles, and bonus-heavy compensation. |
| Over TRY 5,300,000 | TRY 1,697,500 on the first TRY 5,300,000, then 40% on the excess. | High earners may also need annual tax return review depending on income profile. |
How the minimum wage exemption affects payroll
Turkey’s minimum wage exemption does not mean all salary is tax-free. It means that the income tax and stamp tax corresponding to the statutory minimum-wage portion are relieved under the applicable rules. For employees earning above minimum wage, payroll must still calculate income tax on the taxable salary, apply the cumulative brackets, and then reflect the exemption in the correct way.
Why monthly net salary can change during the year
A common employee question in Turkey is why net pay changes even though gross salary did not change. The answer is usually cumulative income tax. Once the cumulative taxable wage base crosses a bracket threshold, a higher tax rate applies to the excess. A good payroll report should show the current month’s taxable base, cumulative tax base, current withholding, exemption impact, and resulting net salary.
Official income tax reference link
Employers can review the Revenue Administration’s 2026 income tax tariff and the Revenue Administration’s 2026 wage income guide when reviewing salary tax treatment.
The MUHSGK Month-End Rhythm: One Payroll Run, Several Deadlines
Turkey payroll should be managed through a monthly closing calendar. The payroll run is not complete when salaries are paid. Employers also need payroll approval, employee payslip preparation, SGK and tax reporting, accounting reconciliation, and record retention.
Recommended monthly payroll workflow
| Payroll stage | What happens | Employer action |
|---|---|---|
| 1. Payroll input cut-off | Collect new hires, leavers, salary changes, allowances, bonuses, commissions, overtime, leave, unpaid absence, deductions, and bank changes. | Submit approved payroll data before the agreed cut-off date. |
| 2. Employee status validation | Check employment contract, SGK status, work permit status for foreign employees, tax status, and active or leaver record. | Resolve missing employee data before calculation starts. |
| 3. Draft payroll calculation | Calculate gross-to-net salary, employee deductions, employer contributions, cumulative income tax, stamp tax, and payroll exceptions. | Review draft payroll report and confirm adjustments. |
| 4. Employer approval | Final payroll report, employee net salary list, employer cost report, and exception notes are prepared. | Approve payroll before salary payment and declaration preparation. |
| 5. Salary payment support | Prepare payment summary or salary payment file in TRY. | Fund payroll and execute salary payment through the agreed payment process. |
| 6. Payslip release | Prepare employee payslips showing gross salary, deductions, taxes, and net salary. | Deliver payslips and answer employee payroll questions with supporting records. |
| 7. MUHSGK and reporting support | Payroll data is prepared for monthly withholding and premium service declaration workflow. | Reconcile payroll with tax, SGK, and accounting records before the declaration deadline. |
Why the 26th of the following month matters
The Muhtasar ve Prim Hizmet Beyannamesi is a central payroll compliance document in Turkey. For monthly filers, it is generally submitted electronically by the 26th day of the following month. Payroll teams should therefore close payroll early enough to review taxable salary, SGK base, tax withholding, stamp tax, and employee service data before the declaration is finalized.
Keep payment, declaration, and accounting aligned
Payroll reports should reconcile with the salary payment file, the monthly declaration, SGK records, and accounting entries. If the payroll report and declaration do not match, later corrections can create avoidable administrative work, employee questions, and compliance exposure.
Official reporting reference link
Employers can review the Revenue Administration’s declaration and payment deadline schedule and the e-Beyanname portal for payroll-related declaration administration.
Allowances, Overtime, Leave, and Severance: The Items That Break Simple Payroll Templates
Many Turkey payroll errors happen outside the base salary line. Allowances, overtime, paid leave, unpaid leave, sick leave, maternity leave, bonuses, regular benefits, notice pay, and severance can all affect payroll differently. A simple gross-to-net calculator is not enough for a real monthly payroll operation.
Common payroll-sensitive compensation items
| Item | Payroll question to ask | Why it matters |
|---|---|---|
| Meal allowance | Is it cash, card-based, in-kind, or paid through another arrangement? | Tax and SGK treatment may differ depending on structure and exemption limits. |
| Transportation allowance | Is it reimbursed, paid as a cash allowance, or provided through transport support? | Classification affects payroll tax and contribution treatment. |
| Overtime | Was overtime approved, recorded, and calculated at the correct rate? | Overtime affects gross pay, tax, SGK, and employee disputes. |
| Bonuses and commissions | Are payments one-off, recurring, guaranteed, or performance-based? | Recurring payments may affect severance base and employment cost planning. |
| Unpaid leave | How many days are excluded from salary and SGK reporting? | Incorrect day counts can affect salary, declaration, and employee record accuracy. |
| Unused annual leave | Is unused leave being paid at termination? | Leave balances must be reconciled before final settlement. |
| Severance pay | Does the termination reason create severance entitlement, and what wage base applies? | Severance can be a large termination cost and must be calculated with the current legal ceiling. |
Severance is a payroll liability, not only a legal topic
In Turkey, severance pay can involve gross wage, length of service, recurring benefits that can be measured in money, termination reason, and the severance-pay ceiling at the date of termination. Payroll teams should not calculate severance from base salary alone unless the employee’s compensation structure has been reviewed.
Final settlement checklist
- Final salary up to the last working day.
- Unused annual leave payment where applicable.
- Severance pay where the termination reason qualifies.
- Notice pay or pay in lieu of notice where applicable.
- Bonuses, commissions, premiums, or regular benefits due at exit.
- Employee loans, advances, or lawful deductions.
- SGK exit notification and payroll declaration alignment.
- Payslip, payment proof, and settlement documentation.
Official labor reference links
Employers can review the Ministry of Labour’s business rules FAQ and the Turkish Labour Act reference available through the ILO NATLEX database when assessing wage, leave, overtime, and termination-related payroll items.
Foreign Employees in Turkey: Work Permit Status Must Match Payroll Status
Foreign employee payroll in Turkey requires additional review because payroll, immigration, work authorization, employment contract terms, social security, salary level, and cross-border compensation may all interact. A foreign employee should not simply be added to the same payroll setup as a local employee without checking the work permit and employment structure.
Foreign employee payroll items to review
- Whether the employee has a valid work permit or work permit exemption.
- Whether the work permit is tied to the correct employer, workplace, position, and contract term.
- Whether the salary declared in the work permit application aligns with payroll salary.
- Whether the employee is paid fully in Turkey or partly through another country.
- Whether a social security agreement or certificate of coverage affects SGK treatment.
- Whether the employee is a Turkish tax resident or non-resident for the relevant period.
- Whether housing, relocation, education, cost-of-living, or home-leave benefits should be treated as employment income.
- Whether final payroll is required before the employee leaves Turkey or changes employer.
Split payroll should be documented before the first salary cycle
Some internationally mobile employees receive part of their compensation through a Turkish payroll and part through an overseas payroll. This can create tax, SGK, and reporting complexity. Before payroll begins, the employer should document the employee’s legal employer, work location, salary components, payment location, benefit package, and whether foreign-source payments are connected to Turkish employment duties.
Work permit planning should come before payroll activation
If the employee is a foreign national, payroll setup should be aligned with work permit timing and onboarding documents. NNRoad can support foreign-national employment through Turkey Expat Employment services. If your company does not have a Turkish entity, review Turkey Employer of Record services before choosing standalone payroll outsourcing.
Official work permit reference links
Employers can review the Ministry of Labour’s work permit FAQ and work permit types page when coordinating foreign employee onboarding with payroll.
Net-to-Gross Offers: Why Turkey Payroll Needs Cost Forecasting Before the Offer Letter
Turkey employees and employers may discuss salary in gross or net terms. For foreign companies, this creates a practical problem: a net salary promise can become expensive if the employer does not model cumulative income tax, SGK contributions, stamp tax, employer SGK, unemployment insurance, and incentive eligibility before the offer is finalized.
Simplified gross-to-net example for a first payroll month
The example below is for illustration only. It assumes a standard employee with a gross monthly salary of TRY 100,000, a first-month calculation, employee SGK at 14%, employee unemployment insurance at 1%, general minimum-wage income tax and stamp tax exemption logic, and no special deductions. Actual payroll may change based on cumulative tax base, incentives, exemptions, allowances, foreign employee status, and current legal interpretation.
| Payroll item | Illustrative amount | Calculation note |
|---|---|---|
| Gross monthly salary | TRY 100,000.00 | Salary before employee deductions and tax. |
| Employee SGK | TRY 14,000.00 | 14% employee SGK contribution in this simplified example. |
| Employee unemployment insurance | TRY 1,000.00 | 1% employee unemployment insurance contribution. |
| Income tax after minimum-wage exemption | TRY 8,538.67 | First-month simplified income tax calculation after minimum-wage exemption impact. |
| Stamp tax after minimum-wage exemption | TRY 508.30 | Simplified stamp tax calculation after minimum-wage exemption impact. |
| Estimated employee net salary | TRY 76,953.03 | Gross salary minus employee deductions, income tax, and stamp tax. |
| Employer SGK with 2-point discount | TRY 19,750.00 | Illustrative employer SGK at 19.75%, assuming the general discount applies. |
| Employer unemployment insurance | TRY 2,000.00 | 2% employer unemployment insurance contribution. |
| Estimated employer cost before provider fees and benefits | TRY 121,750.00 | Gross salary plus employer SGK and employer unemployment insurance in this simplified scenario. |
Why the same salary can produce different later-month net pay
The example above is a first-month view. In later months, cumulative taxable income may move into higher tax brackets, which can reduce the employee’s net salary even when gross salary stays the same. For senior employees, commission earners, and expatriates, net-to-gross modeling should be done across the full year, not only the first payroll month.
Employer cost is not only gross salary
A Turkey employment budget should include gross salary, employer SGK, employer unemployment insurance, allowances, benefits, payroll provider fees, severance exposure, unused leave liability, bonus accrual, and termination cost. For preliminary planning, employers can use NNRoad’s Turkey labor cost calculator before finalizing compensation.
Turkey Payroll Setup Pack for a Local Entity
A clean Turkey payroll launch depends on data quality. Missing employee IDs, wrong start dates, incomplete work permit information, unclear allowance treatment, or missing prior-year payroll data can affect tax, SGK, net pay, and monthly declarations.
Company-level setup information
- Turkish entity legal name and registration information.
- Tax office and tax identification details.
- SGK workplace registration details.
- Payroll contact persons and authorized approvers.
- Payroll frequency, salary payment date, and monthly cut-off date.
- Bank payment process and salary payment file requirements.
- Accounting codes, cost centers, department structure, and management reporting format.
- Current payroll provider or in-house payroll handover documents, if applicable.
Employee-level setup information
- Employee full legal name and Turkish identity number or foreigner identity number where applicable.
- Employment contract, start date, work location, job title, and working schedule.
- Gross salary, net salary expectation, allowances, bonuses, commission rules, and benefits.
- Bank details for salary payment.
- SGK status and prior employment information where relevant.
- Work permit and residence details for foreign employees.
- Leave balance, unpaid leave records, and prior payroll history where relevant.
- Taxable benefits, recurring payments, and any special exemption or incentive status.
Monthly payroll input checklist
- New hires and leavers.
- Salary changes and promotion adjustments.
- Allowances, bonuses, commissions, and incentive payments.
- Overtime, shift work, weekend work, and public holiday work.
- Paid leave, unpaid leave, sick leave, maternity leave, and absence records.
- Approved deductions, salary advances, employee loans, or reimbursements.
- Foreign employee work permit changes.
- Cost center, department, or project coding changes.
- Final settlement data for resigning or terminated employees.
Migration review from another provider
If your company is moving from another payroll provider or from manual payroll, NNRoad may request prior payroll reports, cumulative income tax records, SGK base records, MUHSGK history, employee payslips, leaver records, severance records, leave balances, and unresolved payroll issues. This helps reduce transition risk before the first live pay run.
Payroll, EOR, Expat Employment, or On-Demand Talent in Turkey?
Companies often search for a Turkey payroll service provider when they are still deciding how the worker should be engaged. The correct route depends on whether your company already has a Turkish entity, whether the person should be an employee, whether the worker is a foreign national, and whether the engagement is long-term employment or flexible project support.
| Business need | Best-fit NNRoad route | How it connects with payroll |
|---|---|---|
| You already have a Turkish entity and need SGK, income tax, stamp tax, payslips, MUHSGK support, and monthly payroll reporting. | Turkey Payroll Service | Your entity remains the legal employer; NNRoad supports payroll calculation and reporting workflow. |
| You want to hire an employee in Turkey but do not have a Turkish legal entity. | Turkey Employer of Record | The EOR model provides a local employment route and includes payroll administration through the local employer structure. |
| You need to hire or relocate a foreign national to work in Turkey. | Turkey Expat Employment | Payroll must be aligned with work permit, residence, SGK, tax, and employment contract requirements. |
| You need flexible project-based support rather than a standard employment relationship. | Turkey On-Demand Talent | The payment and compliance model may differ from employee payroll and should be reviewed before engagement. |
| You manage payroll in multiple countries and need consolidated reporting. | Global Payroll | Turkey payroll can be connected to a wider multi-country payroll reporting and approval process. |
Do not use payroll outsourcing to solve an entity issue
If your company has no Turkish employer structure, payroll outsourcing alone is usually not enough. The first decision should be whether to incorporate, use an EOR, engage a contractor, or choose another compliant workforce route.
Do not process contractors as employees without review
Turkey has important differences between employees, independent contractors, consultants, and outsourced service arrangements. If the worker should legally be treated as an employee, payroll, SGK, income tax withholding, and employment-law protections may apply. Classification should be reviewed before payment begins.
Build a Turkey Payroll Process That Survives Wage Changes and SGK Updates
Turkey payroll can look manageable when a company has only one or two employees. The complexity grows quickly when the company adds bonuses, foreign employees, net salary offers, SGK incentives, unpaid leave, work permit renewals, multi-city hiring, severance cases, and year-end tax questions.
NNRoad helps employers turn Turkey payroll into a controlled monthly process. A stronger process includes payroll cut-off, input validation, SGK and tax calculation, cumulative tax tracking, employer cost reporting, payslip preparation, MUHSGK support, and record retention.
What a stronger Turkey payroll process gives your team
- Clearer gross-to-net and employer-cost reporting.
- Better control over SGK contribution base and employer incentive assumptions.
- More predictable cumulative income tax handling.
- Cleaner payslip communication for employees.
- Better handling of allowances, overtime, leave, and final settlement.
- Improved coordination for foreign employees and work permit-linked payroll.
- A payroll structure that can support headcount growth across Turkey.
Start with a payroll scope review
To assess your Turkey payroll needs, prepare your Turkish entity status, employee count, employee nationalities, work locations, salary structure, current payroll process, SGK registration status, and target payroll launch date. NNRoad can then help confirm whether your case fits Turkey payroll outsourcing, EOR, expat employment, on-demand talent, or a combined workforce solution.
For broader Turkey workforce planning, you can also review the Turkey country hub or estimate employment cost through the Turkey labor cost calculator.
QUICK FAQs
What does a Turkey payroll service provider do?
A Turkey payroll service provider helps employers calculate gross-to-net salary, employee SGK, employee unemployment insurance, income tax, stamp tax, employer SGK, employer unemployment insurance, payslips, monthly payroll reports, and declaration-ready payroll data. For companies with a Turkish entity, payroll outsourcing can reduce manual work while the company remains the legal employer.
Does my company need a Turkish entity to use payroll outsourcing in Turkey?
In most cases, yes. Turkey payroll outsourcing is designed for companies that already have a compliant local employer structure, such as a Turkish company, branch, subsidiary, or registered employer arrangement. If your company does not have a Turkish entity but wants to hire an employee in Turkey, an Employer of Record model may be more suitable than standalone payroll outsourcing.
What are the main payroll deductions in Turkey?
The main employee-side payroll deductions in Turkey usually include employee SGK, employee unemployment insurance, income tax, and stamp tax. Employer-side costs usually include employer SGK and employer unemployment insurance. The final calculation can change based on SGK contribution base limits, income tax brackets, minimum-wage exemption logic, allowances, bonuses, and employer incentive eligibility.
What is the 2026 minimum wage in Turkey?
For 2026, Turkey’s monthly gross minimum wage is TRY 33,030.00 and the net minimum wage is TRY 28,075.50. The daily gross minimum wage is TRY 1,101.00. Employers should update payroll templates, SGK base settings, salary offer models, and employer cost forecasts when minimum wage changes.
Why does net salary change during the year in Turkey?
Net salary can change during the year because Turkey uses cumulative income tax brackets. As the employee’s taxable wage base accumulates month by month, the employee may move into a higher tax bracket. This can reduce net pay even if gross salary remains the same. Payroll reports should show cumulative taxable income, current-month tax, exemption impact, and net salary clearly.
How are foreign employees handled in Turkey payroll?
Foreign employee payroll in Turkey should be reviewed together with work permit, residence status, employment contract, salary level, SGK treatment, tax residency, and any split-payroll arrangement. The salary reported in payroll should align with the work permit and employment documentation. If a foreign employee is paid partly outside Turkey, the employer should review tax and social security implications before the first payroll cycle.
When should a company choose Turkey EOR instead of Turkey payroll outsourcing?
A company should choose Turkey Employer of Record services when it wants to hire an employee in Turkey but does not have a local legal entity or compliant employer structure. Payroll outsourcing supports an existing employer. EOR provides a local employment route where the EOR provider acts as the legal employer while the client manages the employee’s daily work, goals, and performance.