Month: November 2025
EOR vs. PEO: Which Model Is Suitable for Hiring in Belarus?
International companies planning to hire specialists in Belarus increasingly consider alternative market-entry models to reduce administrative risks and accelerate the launch of operations. The most popular solutions are the EOR (Employer of Record) and PEO (Professional Employer Organization) models. Both allow companies to operate without establishing a legal entity, but they differ in liability levels, interaction structure, and the scope of employer responsibilities that remain on the client’s side.
For IT companies and tech teams, it is particularly important to onboard employees quickly, comply with local employment rules, and maintain flexibility in team management. The choice between EOR and PEO affects hiring speed, legal security, and the company’s financial obligations. In this article, we will examine the key differences between the two models, their advantages and limitations, and help determine which solution is more suitable for hiring in Belarus.
Below is an expanded section written in the style of Recruitment.by and aligned with the context of the article.
What EOR and PEO Models Represent
EOR (Employer of Record) and PEO (Professional Employer Organization) are two different approaches to onboarding employees through an external provider. They enable companies to operate in Belarus without establishing a legal entity or with minimal internal administrative effort.
The Essence of the Models and Key Differences
The EOR model assumes that the provider acts as the legal employer. The provider signs the employment contract, prepares all required documentation, calculates salaries, makes mandatory deductions, and interacts with government authorities. The client company manages employees’ tasks and performance but does not bear legal responsibility for employment compliance.
The PEO model is based on co-employment. The provider handles part of HR and administrative functions, but the client company remains the legal employer. This requires deeper involvement from the client in HR administration, hiring, termination, and compliance with local labor regulations.
The main difference between these models is the degree of legal responsibility and the level of control over hiring processes. In an EOR model, the provider assumes full responsibility; in a PEO model, responsibility is shared, and the client must fulfill a significant portion of employer obligations.
How Roles and Responsibilities Are Distributed
In the EOR model, the provider becomes the formal employer and is fully responsible for managing employment relationships: from signing contracts to payroll, leave management, maintaining personnel files, and compliance with government requirements. The client company is responsible only for operational management—setting tasks, quality control, and integrating the employee into the team.
In the PEO model, responsibilities are distributed differently. The provider acts as an HR partner but does not replace the employer. It may process payroll, assist with documentation, and ensure compliance, but legal risks and formal responsibility remain with the client company. This requires a solid understanding of local labor regulations and consistent interaction with the provider.
Why These Models Are in Demand for Hiring in Belarus
The Belarusian market is attractive to international IT teams due to the abundance of skilled specialists, strong engineering culture, and competitive hiring costs. However, for foreign companies, local market entry involves administrative requirements, operational expenses, and strict adherence to local labor procedures.
EOR and PEO allow companies to start operations quickly, avoid complexities of registration, and minimize legal risks. This is especially important when hiring remote teams, launching projects on short notice, or when the scope of operations does not justify establishing a local entity.
The EOR model is typically chosen by companies seeking a simple and secure way to hire employees in Belarus without diving into local labor processes.
PEO is suitable for companies already present in the market or willing to share legal responsibility while retaining greater control over internal HR processes.
How the EOR Model Works in Belarus
Under the EOR model, the employee is officially employed by the provider, which serves as the formal employer. The provider signs the employment contract, maintains HR documentation, manages leave, sick days, business trips, and handles all aspects of the employee’s legal status.
For the client company, this means it can hire specialists in Belarus without registering a legal entity or navigating local employment requirements. The employer manages only tasks and workflows the EOR partner handles everything else.
Tax, HR, and Insurance Responsibilities: Who Handles What
With EOR, all administrative responsibilities lie with the provider. The provider processes payroll, calculates and remits taxes, manages social contributions, submits reports, and ensures compliance with established procedures.
The client does not need to understand local requirements, maintain HR records, or communicate with government authorities. This minimizes the risk of employment-related errors and reduces the likelihood of issues during inspections.
When EOR Provides Maximum Benefit
EOR is especially effective when a company needs rapid market entry, wants to test a new direction, launch a pilot project, or hire individual specialists without investing time in creating a legal entity.
The model is particularly beneficial when:
- a specialist needs to be hired immediately;
- the team is small, making a local office economically unreasonable;
- the company is not ready to take on full administrative responsibility;
- flexibility is required to quickly scale up or down;
- minimizing legal and operational risks is essential.
For international companies seeking a presence in Belarus without bureaucratic barriers, EOR is one of the most convenient and secure employment models.
How the PEO Model Works in Belarus
In the PEO model, the client company remains the official employer, while the provider acts as an outsourced HR partner. Responsibility is shared: the client retains key employer functions, while the PEO manages some administrative tasks such as payroll, leave processing, HR documentation, and compliance support.
This model is particularly useful for companies that already have a legal entity in Belarus but want to optimize HR processes and reduce the workload on internal teams.
What Responsibilities Stay with the Client
Despite the PEO provider’s active role, many obligations remain with the employer. The client independently:
- hires and terminates employees;
- defines employment terms and work conditions;
- manages the team and oversees performance;
- makes strategic HR decisions;
- communicates with employees on work-related matters.
The PEO provides methodological and operational support but does not replace the employer’s core role.
Limitations of the PEO Model for Foreign Companies
For international employers, PEO may be less universal than EOR. The main reason is the requirement to have a legal entity in Belarus. Without it, PEO is impossible because the client is the legal employer.
Additionally, the client must interact with government authorities, participate in inspections, sign official documents, and remain directly responsible for HR and tax compliance. PEO reduces risks and simplifies administration but does not eliminate bureaucratic obligations entirely.
Therefore, PEO is less suitable for companies entering the market for the first time or those not planning to open a local office. Such companies more often choose EOR as a more flexible and secure option.
Comparing EOR and PEO for Hiring in Belarus
Let’s compare EOR and PEO based on several key criteria.
1. Level of Legal Risks and Responsibility
The main distinction is the distribution of responsibility.
Under EOR, the provider carries the full legal burden: it is the official employer, manages HR administration, payroll, compliance, and interactions with government authorities. The client is essentially free from legal risks associated with employment.
In the PEO model, the client company remains the employer. This means full legal responsibility for employees, compliance, and documentation lies with the client. The PEO supports and advises but does not replace the employer before government bodies. For international companies, this often makes PEO less convenient and riskier.
2. Speed of Hiring and Launching Operations
EOR allows companies to hire employees almost immediately after signing the agreement with the provider. There is no need to register a legal entity, open accounts, or obtain employer status, the provider already has the infrastructure in place. As a result, entering the market is fast and seamless.
PEO requires the client to have its own legal entity in Belarus. If the company is new to the market, time required for registration, administrative setup, and accounting procedures significantly slows down the launch. Therefore, EOR always wins in terms of speed.
3. Cost of Services and Hidden Expenses
PEO may appear cheaper based on service fees alone, but companies must also cover costs related to accounting, HR, compliance, and internal administration.
EOR offers a fixed, transparent cost that includes taxes, social contributions, HR support, and full administrative handling. There are no hidden fees. For small teams, EOR is often more cost-effective.
4. Scalability and Team Expansion
EOR provides maximum flexibility: companies can quickly expand, downsize, or build distributed teams. The provider handles all paperwork, which is particularly important during rapid growth or changing project needs.
In the PEO model, scaling requires more involvement from the client, since onboarding and administration must align with internal employer procedures. This increases the bureaucratic load and slows down expansion.
As a result, EOR is ideal for companies that value speed and flexibility, while PEO is suitable for companies already established in Belarus and seeking HR process optimization rather than accelerated growth.
How to Choose the Right Model for Your Company
The optimal hiring model depends on how the company plans to operate in Belarus and what level of administrative responsibility it is willing to assume.
If a business is entering the market for the first time, doesn’t want to establish a legal entity, or needs rapid hiring without administrative procedures, EOR is the logical choice. This model suits startups, distributed teams, companies testing the market, or developing R&D centers.
If a company already has a local presence and plans long-term operations, and if it wants to maintain direct employer status, PEO may be appropriate. It streamlines HR processes but does not replace the employer’s functions. PEO is suitable for companies ready to invest in internal infrastructure.
Typical Mistakes When Choosing EOR or PEO
Many international companies choose a hiring model without fully considering their goals and constraints.
Common mistakes include:
1. Underestimating legal responsibility. In PEO, risks remain on the employer, which is not always clear at the outset.
2. Comparing only service prices. PEO appears cheaper, but total costs are higher due to internal operations and statutory obligations.
3. Expecting “full outsourcing” from PEO. Clients often assume PEO functions like EOR, leading to misunderstandings and compliance errors.
4. Choosing PEO without registering a legal entity. Some foreign teams are unaware that PEO is impossible without local incorporation.
5. Choosing EOR when full employer control is required. EOR is not appropriate if maintaining direct employer status is essential.
These mistakes can be avoided by evaluating goals, operational scale, and legal requirements in advance, as well as consulting with local experts.
Practical Recommendations for International IT Teams
For tech companies working in distributed environments, it is crucial to choose a model that ensures fast hiring and reduces legal burden.
Recommendations:
1. Choose EOR if you need rapid access to talent, this eliminates the need to establish a legal entity and enables onboarding in days.
2. Choose PEO if you already have a local entity and want to optimize HR processes and reduce internal workload.
3. Consider growth plans. During active expansion, EOR offers more flexibility and less administrative pressure.
4. Account for remote work specifics. EOR is more adaptable to distributed teams and international workflows.
5. Conduct a responsibility audit. Understand which functions you want to retain internally and which to delegate to the provider.
For most foreign IT teams entering the Belarusian market, EOR becomes the safest and most efficient solution, as it provides maximum speed, support, and risk reduction.
Conclusion
Ultimately, the choice between EOR and PEO depends on the company’s objectives, operational scale, and the degree of control it wants to maintain. Choosing the wrong model can lead to unnecessary expenses, administrative difficulties, and increased legal risks.
Our team has extensive experience supporting international IT companies in Belarus and can help you select the optimal model for your business, whether EOR or PEO. We handle employee onboarding, payroll, tax and HR compliance, as well as full support throughout the hiring and personnel management cycles. This enables companies to focus on business development while minimizing administrative burden and risks.
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If you contact us by the email we guarantee that you will receive a feedback from us within 2 (two) hours on any business day and within 6 (six) hours on any other day (holidays etc.).
Belarusian Employment Termination and Severance Guide
Human resource management is not only about recruiting, hiring, and developing employees, but also about properly concluding employment relationships. In Belarus, the procedure for terminating employment contracts is regulated in detail, and how competently an employer follows these rules affects not only the company’s reputation but also its financial risks.
Mistakes during dismissal are among the most common causes of labor disputes. Incorrect documentation, failure to meet notification deadlines, and miscalculation of compensations or severance pay can lead to inspections, fines, and lawsuits. At the same time, if the process is systematic and transparent, termination becomes a natural part of the employment lifecycle, without causing conflicts and while maintaining employee loyalty.
For HR specialists and managers, it is essential not only to know the formal rules but also to understand how to apply them in practice, taking into account the specifics of different categories of employees, reasons for termination, and contractual conditions.
This article will examine the key rules for terminating employment contracts in Belarus, the procedure for calculating and paying severance pay, and provide practical recommendations to minimize legal and reputational risks and make the process of ending cooperation as correct and effective as possible.
The Importance of Properly Ending Employment Relationships
Terminating an employment contract is a natural part of any company’s operations. However, the way the dismissal is executed largely determines not only the legal safety of the business but also the employer’s reputation in the labor market. In the IT and recruitment sectors, where competition for skilled personnel is particularly high, proper termination of employment becomes part of corporate culture and a tool for maintaining trust in the brand.
Why Following the Termination Procedure Is Legally Important
Belarusian law regulates the grounds, procedures, and deadlines for terminating employment contracts. Any deviation from established procedures may have serious consequences, from reinstatement of the dismissed employee by court decision to fines and compensation.
Compliance with termination rules protects the employer from risks and confirms that the dismissal decision is justified. For instance, if an employee is dismissed at the employer’s initiative, it is important to document the grounds — disciplinary violations, staff reduction, or contract expiration.
In addition, correct documentation and calculations reduce the likelihood of disputes, inspections, and reputational losses.
How Proper Termination Affects HR Branding and Workplace Climate
Dismissal is always a sensitive moment for both parties. Even if the reasons for separation are objective, the way the company handles the process shapes employees’ perception of corporate culture.
Transparent communication, respectful treatment, and timely payments help maintain loyalty not only of the dismissed employee but also of the remaining team.
For IT companies and fast-growing organizations, this is especially important: the market is small, and former employees often become partners, clients, or return to the company in the future. Proper termination of employment is part of a long-term HR strategy, not just a legal formality.
Common Employer Mistakes During Employee Dismissal
Mistakes in dismissal are most often linked to underestimating legal nuances and human factors. Common problems include:
- Failure to meet notification deadlines — for example, when terminating a contract or reducing staff.
- Improper documentation — orders, acts, payroll slips.
- Incorrect calculation of compensation and vacation pay.
- Poor communication — when the employee learns of the decision unexpectedly, without explanation or preparation.
Such situations can lead not only to lawsuits but also to internal conflicts, loss of trust, and reduced engagement of remaining employees.
Proper, transparent, and legally sound termination of employment demonstrates a company’s maturity and responsibility toward its team.
Types of Employment Contracts and Their Termination Features
Before discussing the termination procedure, it is important to understand which type of employment contract an employee has. The form and terms of the contract directly affect the grounds for termination and the guarantees provided to both parties. In Belarus, three main types of employment contracts are used: indefinite, fixed-term, and contracts.
Indefinite, Fixed-Term Contract, and Contract: Differences in Grounds for Termination
- Indefinite employment contract — the most flexible type of contract without a predetermined expiration date. It ends either at the initiative of one of the parties (employee or employer) or on other legal grounds established by labor law. Termination by the employer requires valid reasons and adherence to the notification procedure.
- Fixed-term employment contract — concluded for a specific period, e.g., for a project or temporary replacement. It automatically expires at the end of the term unless either party expresses a desire to continue. Early termination is possible only on established grounds, such as mutual agreement or gross disciplinary violation.
- Contract — a special type of employment agreement widely used in Belarus, especially in the public and IT sectors. Contracts are usually for a fixed term (typically 1–5 years) and include additional conditions: obligations of the parties, grounds for renewal or termination, and more. A contract can be terminated by the employer with one month’s notice if there are no plans to extend it. For employees, it provides predictability; for the company, it serves as a management tool.
Grounds for Termination: Employer, Employee, and Mutual Agreement
There are several groups of grounds for terminating an employment contract:
- Employee’s initiative: The employee may terminate the contract with one month’s written notice (unless otherwise stated in the contract). In certain cases, e.g., violation of working conditions or delayed salary, termination can occur without notice.
- Employer’s initiative: Applied in cases of staff reduction, company liquidation, employee’s unsuitability for the position, systematic non-performance of duties, absenteeism, and other violations. It is essential to document the grounds, notify the employee in the prescribed period, and pay all due compensation.
- Mutual agreement: The most civilized and flexible method of ending employment. Terms (date, compensation, wording) are determined by agreement between the employee and employer. This option is often used during company restructuring, staff optimization, or at the employee’s request, allowing both sides to maintain neutral relations.
Cases Requiring Special Procedures (Pregnant Women, Leave, Sick Leave, etc.)
Belarusian labor law provides special guarantees for certain categories of employees, whose termination requires additional procedures:
- Pregnant women and women on maternity leave cannot be dismissed at the employer’s initiative, except in cases of company liquidation.
- Employees on vacation or sick leave are also protected: termination decisions can only be made after they return to work.
- Termination of minors, union members, and employees with disabilities requires union or authorized body approval.
Following these rules is not just a legal obligation but a demonstration of corporate social responsibility. Correct procedures help avoid conflicts, lawsuits, and negative publicity, while strengthening employee trust.
Procedure for Terminating an Employment Contract
Even if the decision to terminate employment is made, it is crucial to follow the process officially and sequentially. Proper adherence to the termination procedure protects the employer from claims and ensures employees receive all due payments and documents. Key steps include:
Notification: Deadlines and Form
The first step is formal notification of the upcoming dismissal. Its form and timing depend on the grounds for termination:
- Employee’s initiative: Written notice at least one month in advance; for temporary or seasonal work, at least three days.
- Employer’s initiative: Timing varies: two months’ notice for company liquidation or staff reduction; one month for contract expiration.
- Mutual agreement: Parties determine the termination date via written agreement.
Notification must be in writing — either delivered in person against signature or sent by registered mail. Oral agreements have no legal effect. For the employer, this confirms that the procedure began lawfully and on time.
Issuing an Order and Recording in the Employment Book
The next step is issuing an order of termination, signed by the head of the organization, with the employee acknowledging it. The order should include:
- Grounds for dismissal (with reference to the relevant Labor Code article).
- Termination date.
- Information on payments and compensation.
Based on the order, a record is made in the employee’s employment book with the exact reason and legal basis. Precise wording is important for potential disputes or court cases.
Document Handover and Final Settlement
On the dismissal day, the employer must complete the final settlement and provide all necessary documents, including:
- Salary for days worked.
- Compensation for unused vacation.
- Severance pay (if applicable).
- Other payments provided by the contract or collective agreement.
The employee should also receive:
- Original employment book.
- Income certificate (if requested).
- Copies of orders or documents confirming employment history, if needed.
If the employee does not collect documents, the employer must send written notification of the need to do so. Timely handover and accurate calculation reflect the company’s business reputation and conclude employment in a civilized manner.
Severance Pay: When and How Much
Severance pay is financial compensation paid by the employer upon termination in certain cases. It mitigates the impact of dismissal and ensures minimal financial stability while seeking new employment. Proper calculation and timely payment demonstrate compliance with the law and the employer’s social responsibility.
Grounds for Severance Pay
Severance pay is not mandatory in all dismissals but only in legally prescribed cases, including:
- Company liquidation or cessation of business.
- Staff reduction.
- Employee refusal to continue due to changes in significant working conditions.
- Military or alternative civilian service conscription.
- Refusal to transfer to another position for medical reasons if no suitable vacancy exists.
Contracts or collective agreements may also provide for severance pay in mutual agreement terminations or employer-initiated dismissals without disciplinary violations.
Calculation Based on Reason for Termination
The amount depends on the termination grounds:
- Company liquidation or staff reduction — at least three average monthly salaries.
- Refusal to continue work due to changed conditions — two weeks’ average salary.
- Military conscription — two weeks’ salary.
- Other cases (mutual agreement or contract) — as specified in the agreement.
The calculation is based on the average salary over the last two months, including bonuses and allowances. If the contract provides higher compensation, the higher amount applies, following the principle of maximum guarantee for the employee.
Additional Compensation in Contracts and Collective Agreements
Modern companies, particularly in IT, consulting, and finance, often provide additional benefits beyond legal requirements. These may include:
- Extra severance pay under mutual agreements (1–3 months’ salary).
- Payment for the job search period if dismissal is not due to misconduct.
- Compensation for unused bonuses, premiums, or stock options.
- Extended social benefits, such as continued health insurance.
Collective agreements may also increase severance pay for certain employee categories, e.g., long-serving staff, veterans, or employees dismissed due to restructuring.
Termination by Mutual Agreement
Termination by mutual agreement is one of the most flexible and safe methods. It allows parties to agree on dates, terms, and payments without conflict or unnecessary formality. This method is increasingly used in Belarusian companies, especially in IT and service sectors, where employer reputation and risk-free separation are valued.
Advantages for employer and employee:
- Employer: avoids lengthy procedures, reduces dispute risk, maintains a positive image.
- Employee: can negotiate extra compensation or bonuses, choose termination date, and retain neutral record in employment book.
In short, it helps end cooperation respectfully and minimizes risks for both parties.
How to Properly Document Mutual Agreement Termination
Termination requires clear documentation. The main document is a written agreement signed by both parties, specifying:
- Termination date.
- Compensation amount and procedure.
- Handover of work, property, or documents.
- Issuance of paychecks and certificates.
- Confidentiality, waiver of claims, and confirmation of no debts, if applicable.
After signing, an order of termination is issued, citing the basis as “by mutual agreement (p.1 art.35 of the Labor Code of the Republic of Belarus)”. All documents are provided, and final settlement occurs on the termination day.
Termination must be voluntary — any pressure may be considered a labor rights violation.
Potential Risks and How to Avoid Them
Even mutual agreement terminations can pose risks if the document is poorly drafted or interests are unbalanced. Common risks include:
- Vague conditions: missing date, payment, or obligations.
- Lack of confirmation of voluntary consent.
- Disputes over orally promised compensation.
To avoid issues:
- Document all agreements and obtain signatures.
- Keep copies of agreements and orders.
- Consult a lawyer if necessary to ensure compliance with laws.
Conclusion
Proper termination of an employment contract is not just a formality but a crucial aspect of HR culture. Well-executed dismissal protects the employer’s reputation, maintains trust, and ensures legal security. Transparent procedures, clear documents, and respectful treatment of employees prevent conflicts and labor disputes, balancing the interests of both sides.
If you want to ensure dismissals are conducted correctly and risk-free, contact our team. We provide consultation on terminating employment contracts and calculating severance pay in Belarus, assist in dismissal and hiring procedures, help properly prepare documents, and structure HR processes according to best practices and legal standards.
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If you contact us by the email we guarantee that you will receive a feedback from us within 2 (two) hours on any business day and within 6 (six) hours on any other day (holidays etc.).