US PERM Sponsorship vs Hiring in Poland, India or the Philippines: The Real Employer Cost in 2026
A US company needs a software engineer. It can sponsor a foreign professional for a permanent position in the United States, or it can hire someone to work remotely from Poland, India, or the Philippines.
Samarthya Pandey
Which option costs less over 12 months? What about 36 months? And how much does immigration processing time change the decision?
The answer is more complicated than comparing a US salary with a lower international salary.
PERM sponsorship is an immigration process for a permanent US job. Hiring an employee abroad is an international workforce decision. They are not legally, operationally, or geographically interchangeable.
A foreign employee based in India cannot automatically perform a US-based position merely because a US company pays their salary. Similarly, a US employer cannot replace its obligations under the permanent labor certification process by hiring someone through a foreign Employer of Record (EOR).
Ivvora developed a reproducible four-country employer-cost model using 2026 immigration fees, country-specific payroll obligations, hypothetical compensation packages, EOR administration fees, and 12- and 36-month planning horizons.
The analysis identifies the actual cost of sponsorship, separates immigration delays from hiring delays, and explains when international hiring can reduce expenditure without satisfying the original US workforce requirement.
The Answer: How Much Does Each Hiring Option Cost?
Under Ivvora’s illustrative 2026 employer-cost model, one continuously employed professional produces the following expenditure.
| Hiring Structure | 12-Month Cost | 36-Month Cost |
|---|---|---|
| US employment + PERM sponsorship | $160,395 | $447,555 |
| Poland employee through EOR | $66,530 | $196,591 |
| India employee through EOR | $35,333 | $103,000 |
| Philippines employee through EOR | $34,189 | $99,567 |
All figures are in USD and rounded to the nearest dollar.
These figures are not market-average salaries or verified vendor quotations. They are results from a disclosed hypothetical compensation and administration model.
The US scenario assumes the sponsored employee already has independent authorization to perform the US job for the modeled employment period. PERM itself does not provide work authorization.
The foreign scenarios assume the employee remains physically based in the country where the employment arrangement is established.
The model assumes stable compensation, EOR fees, exchange rates, and 2026 payroll rules throughout the comparison. The 36-month figures are constant-assumption projections, not forecasts of future legislation.
At first glance, hiring in India or the Philippines appears to reduce employer expenditure by approximately 78–79% in the first year.
However, that percentage measures spending under different compensation and employment arrangements. It does not measure equivalent productivity, identical talent quality, or the cost of filling a job that must physically be performed in the United States.
The central finding: international hiring can dramatically change payroll expenditure, but the employer must first determine whether the work can legally and operationally move abroad.
PERM Sponsorship and International Hiring Solve Different Problems
The comparison begins with the purpose of each arrangement.
US PERM Sponsorship
Program Electronic Review Management, commonly known as PERM, is the US Department of Labor’s permanent labor certification process.
For many EB-2 and EB-3 employment-based immigrant petitions, the employer must obtain labor certification before submitting Form I-140 to USCIS.
The certification process generally requires the employer to demonstrate that the job is a bona fide permanent, full-time US opportunity and that there are not sufficient able, willing, qualified, and available US workers for the position under the applicable recruitment requirements.
The process also protects the wages and working conditions of similarly employed US workers.
The employer must establish the appropriate prevailing wage and complete recruitment and filing requirements.
A PERM certification does not itself grant a visa, permanent residence, or authorization to work in the United States.
Official source: US Department of Labor — Permanent Labor Certification
Hiring an Employee in Poland, India, or the Philippines
An international hire works in another country’s labor market.
The employer may engage the individual through an appropriately structured local subsidiary or a legally compliant EOR arrangement.
The employee’s contract, statutory employment rights, social contributions, benefits, and payroll administration generally depend on the relevant country and employment structure.
An EOR typically provides the legal employing entity and associated payroll administration under its service agreement.
The US company receives the employee’s services, but does not automatically become their direct local legal employer.
The precise allocation of responsibilities and the validity of the arrangement require country-specific assessment.
The Structural Difference
| Question | US PERM Sponsorship | Foreign Employee Through EOR |
|---|---|---|
| Intended work location | United States | Foreign country |
| Purpose | Permanent US immigration pathway | Employ worker abroad |
| Requires PERM labor certification? | Usually for applicable EB-2/EB-3 cases | No, for the local foreign role |
| Does the process grant US work authorization? | No | No |
| Legal employer | US sponsoring employer | EOR under a lawful arrangement |
| Main immigration consideration | US visa eligibility and availability | Local right to work |
| Payroll rules | US federal and applicable state rules | Country-specific requirements |
| Typical service cost | Immigration counsel, recruitment, USCIS filings | EOR fees and local payroll |
| Can substitute for a US onsite position? | Designed for the US role | Not without changing how the role is performed |
A US company can sponsor a beneficiary who is living abroad for a future US-based job. The beneficiary does not necessarily need to be working in the United States when the PERM process begins.
But that does not make the worker immediately available for US employment.
The distinction between sponsoring a future US employee and employing someone abroad today is essential to every cost calculation that follows.
What US PERM Sponsorship Actually Costs in 2026
A frequent budgeting mistake is to treat PERM sponsorship as one government application fee.
In reality, the major expenses often arise from professional services, mandatory recruitment, legal preparation, and subsequent immigration filings.
The US Department of Labor does not charge a standard filing fee for submitting Form ETA-9089 under PERM.
But the absence of a DOL filing fee does not make the certification process free.
2026 Government Fee Baseline
| Item | Government Fee | Notes |
|---|---|---|
| PERM prevailing wage request | $0 | No standard DOL filing fee |
| PERM application, ETA-9089 | $0 | No standard DOL filing fee |
| USCIS Form I-140 | $715 | General filing fee |
| I-140 Asylum Program Fee — regular petitioner | $600 | Additional fee |
| I-140 Asylum Program Fee — qualifying small employer | $300 | Reduced additional fee |
| I-140 Asylum Program Fee — qualifying nonprofit | $0 | Exempt category |
| Optional I-140 premium processing | $2,965 | Effective March 1, 2026 |
| Employment-based immigrant visa processing | $345 | Per applicant, consular-processing route |
A typical regular for-profit petitioner therefore faces $1,315 in basic I-140 government filing and Asylum Program fees, excluding premium processing and other immigration expenses.
The premium-processing fee increased from $2,805 to $2,965 effective March 1, 2026, under the January 12, 2026 final rule.
Official sources: USCIS Fee Schedule, 2026 Premium Processing Fee Rule, and US Department of State Visa Fees.
The $345 immigrant-visa fee applies to the relevant consular process. Adjustment of status inside the United States follows different procedures and fees.
Dependent applicants, medical examinations, immigrant fees, and other application expenses may create additional costs.
Ivvora’s Illustrative Sponsorship Budget
| Expense | Modeled Amount |
|---|---|
| PERM legal preparation and representation | $8,000 |
| Required recruitment and advertising | $3,500 |
| I-140 filing fee | $715 |
| Asylum Program Fee — regular employer | $600 |
| I-140 legal preparation | $2,500 |
| Total modeled sponsorship expenditure | $15,315 |
| Optional premium processing | +$2,965 |
| Total with optional premium processing | $18,280 |
The legal and recruitment costs in this table are illustrative procurement assumptions, not regulated prices or a survey-derived market average.
Actual legal charges can vary substantially based on case complexity, recruitment geography, attorney engagement terms, audits, and additional immigration work.
The model assumes an ordinary regular-petitioner I-140 fee and one successful, non-audited PERM case followed by the relevant I-140 filing.
It does not include a separate H-1B petition, status-extension application, adjustment-of-status application, consular-processing charges, travel, dependents, or the cost of responding to an audit.
A critical distinction is that not every cost listed above must necessarily be paid immediately at the start of the sponsorship process.
The timing depends on the progress of each immigration stage.
Who Is Legally Required to Pay PERM Expenses?
Under 20 CFR § 656.12(b), employers generally cannot seek or receive reimbursement for costs connected with obtaining permanent labor certification, including the employer’s attorney fees and recruitment-related expenses.
This prohibition encompasses indirect reimbursements such as wage deductions or other prohibited arrangements.
A foreign worker may retain a separate lawyer at their own expense within the regulation’s limits. Where an attorney represents both employer and worker in the labor certification matter, the employer must bear the relevant attorney costs.
The regulation should not be misrepresented as automatically allocating every expense associated with every later immigration application.
The I-140, adjustment-of-status, and consular stages require their own legal and contractual cost analysis.
Official source: US Department of Labor — PERM Rule and Employer-Payment Requirements.
Employers should not build prohibited PERM-cost repayment clauses into retention agreements.
The Waiting Period: PERM Is Not an Immediate Hiring Solution
The value of an employment arrangement depends partly on when a person can actually start performing the required work.
As of the Department of Labor’s October 5, 2026 PERM update:
- PERM analyst review was processing applications with priority dates around December 2025.
- PERM audit review was also working on applications from approximately December 2025.
- The reported average analyst-review processing time for determinations issued in August 2026 was 336 calendar days.
- As of September 30, 2026, PERM prevailing wage determinations were being processed for requests submitted around June 2026.
These are published processing indicators, not guaranteed deadlines for a new application.
Official source: DOL FLAG Processing Times.
The Actual Sponsorship Sequence
| Stage | Main Activity | Does It Authorize US Employment? |
|---|---|---|
| Prevailing wage | Determine the minimum wage for the US position | No |
| Recruitment | Conduct required labor market recruitment | No |
| PERM filing | Submit labor certification application | No |
| PERM adjudication | DOL reviews the application | No |
| I-140 | USCIS adjudicates immigrant petition | No |
| Visa-number availability | Priority date must satisfy relevant rules | No |
| Final immigration processing | Consular immigrant visa or adjustment of status | Only when the person obtains the applicable work authorization or status |
The steps should not be compressed into an advertised guaranteed processing time.
For a new employee who has no existing US work authorization, the company may be unable to receive any US-based employment services from that individual during significant portions of the process.
For someone already authorized to work for that employer, however, employment may continue while sponsorship proceeds, subject to the individual’s actual immigration status and its conditions.
Why Premium Processing Does Not Solve the Full Delay
Paying $2,965 for eligible I-140 premium processing accelerates USCIS action on that petition within the applicable premium-processing framework.
It does not accelerate the entire PERM recruitment and certification process, eliminate visa-number backlogs, or independently authorize employment.
An employer facing a multi-year immigrant visa backlog cannot turn PERM into an immediate immigration route merely by purchasing I-140 premium processing.
The October 2026 Visa Bulletin Changes the Calculation
Employment-based immigrant visa availability is not the same for all beneficiaries.
The US Department of State’s October 2026 Visa Bulletin shows materially different final action dates.
Employment-Based Final Action Dates — October 2026
| Country of Chargeability | EB-2 | EB-3 Skilled Workers / Professionals |
|---|---|---|
| India | November 1, 2013 | January 1, 2014 |
| Philippines | January 1, 2025 | August 15, 2023 |
| Poland / Most Other Countries | January 1, 2025 | May 15, 2024 |
Official source: US Department of State — October 2026 Visa Bulletin.
These dates represent visa availability cutoffs, not predicted processing completion dates.
A new PERM applicant in October 2026 cannot simply subtract a published cutoff year from 2026 and treat the resulting number as a guaranteed waiting period.
Dates can advance, stall, or retrogress.
The Country-of-Birth Problem
Employment-based immigrant visa chargeability generally depends on the beneficiary’s country of birth, with specific statutory exceptions such as qualifying cross-chargeability.
It is not ordinarily determined by where the person currently lives or works.
For example, an India-born software engineer working in Poland does not ordinarily become eligible for Poland’s employment-based visa cutoffs merely by relocating there.
Similarly, hiring a Philippines-born employee through an EOR in India does not change their US immigrant visa chargeability.
The international employment location and the US immigrant visa queue are separate variables.
This distinction is especially important for international companies evaluating whether an employee should work abroad while waiting for a possible US immigration pathway.
A lawful foreign employment arrangement may provide an opportunity to work abroad, but it does not eliminate the relevant US immigrant visa backlog.
Ivvora’s Four-Country Employer Cost Model
To make the comparison auditable, Ivvora constructed one hypothetical professional-role scenario across four employment locations.
The role is a full-time individual contributor providing software engineering services.
The modeled jobs have broadly comparable functional descriptions, but their compensation levels are deliberately different.
This model does not establish that equally qualified candidates are available at every assumed salary or that a distributed role produces identical outcomes to a US-based position.
Annual Compensation Assumptions
| Input | United States | Poland | India | Philippines |
|---|---|---|---|---|
| Gross base salary, USD equivalent | $120,000 | $48,000 | $28,000 | $24,000 |
| Local monthly base salary | $10,000 | PLN 15,000 | INR 210,000 | PHP 116,000 |
| EOR monthly administrative fee | Not applicable | $600 | $450 | $450 |
| EOR onboarding | Not applicable | $500 | $500 | $500 |
| Equipment and setup | $1,500 | $1,000 | $1,000 | $1,000 |
For the foreign models, the total one-time cost is $1,500: a $500 EOR onboarding charge plus $1,000 in equipment and setup.
The salary and provider-fee inputs are hypothetical budgeting assumptions, not verified market rates.
Currency Assumptions
To isolate the employment-cost mechanics, Ivvora uses fixed illustrative conversion rates.
| Currency | Modeled USD Conversion |
|---|---|
| Polish złoty | PLN 3.75 per USD |
| Indian rupee | INR 90 per USD |
| Philippine peso | PHP 58 per USD |
These are modeling rates, not representations of the live foreign-exchange market on October 18, 2026.
The foreign salaries are defined in local currency, and their USD values are calculated using the assumed rates.
The USD-denominated EOR fees remain fixed in the base scenario.
Actual providers may bill in different currencies, include FX margins, or impose payroll-funding requirements.
United States: Annual Employer Cost With PERM Sponsorship
The US scenario uses a $120,000 annual salary.
Employer Social Security tax is 6.2%, and employer Medicare tax is 1.45% on applicable wages.
For 2026, the Social Security taxable wage base is $184,500, so the modeled $120,000 salary falls below the ceiling.
The employer FICA cost is therefore:
$120,000 × 7.65% = $9,180 annually.
Official sources: IRS — Social Security and Medicare Tax Rates and SSA — 2026 Wage Base.
Annual US Employer Budget
| Component | Annual Cost |
|---|---|
| Gross salary | $120,000 |
| Employer Social Security and Medicare | $9,180 |
| Employer medical and other benefits budget | $12,000 |
| Unemployment insurance, payroll administration and other employer-cost allowance | $2,400 |
| Annual operating employment cost | $143,580 |
| One-time PERM and I-140 sponsorship budget | $15,315 |
| One-time equipment and setup | $1,500 |
| Total first-year model | $160,395 |
The $12,000 benefits budget and $2,400 combined allowance are illustrative estimates. They are not universal statutory rates.
The allowance is designed to reserve money for costs beyond employer FICA, but it is not a state-specific unemployment-tax calculation or a complete employee-benefit valuation.
The model excludes optional premium processing.
Three-Year US Cost
Three years of operating employment expense:
$143,580 × 3 = $430,740
Add modeled one-time sponsorship and setup:
$430,740 + $15,315 + $1,500 = $447,555
This assumes the person is continuously and lawfully employed in the United States throughout the 36 months.
It does not imply that a new overseas candidate can obtain US work authorization immediately through PERM.
Poland: Annual Cost of Hiring Through an EOR
The Poland scenario assumes a monthly gross salary of PLN 15,000.
For the simplified employer contribution model:
- Employer pension insurance: 9.76%.
- Employer disability insurance: 6.50%.
- Employer accident insurance: 1.67%.
- Labour Fund and Solidarity Fund: 2.45% combined.
- Guaranteed Employee Benefits Fund: 0.10%.
Total modeled employer contribution rate: 20.48%.
The actual rate varies with applicable insurance and fund rules.
The modeled annual salary is PLN 180,000, below Poland’s PLN 282,600 annual pension and disability contribution-base limit for 2026.
Poland Employer Payroll Calculation
| Component | PLN per Month | PLN per Year |
|---|---|---|
| Gross salary | 15,000 | 180,000 |
| Employer contributions at 20.48% | 3,072 | 36,864 |
| Payroll cost before EOR | 18,072 | 216,864 |
Convert to USD using PLN 3.75 per USD:
PLN 216,864 ÷ 3.75 = $57,830.40
Add annual EOR administration:
$600 × 12 = $7,200
Add one-time setup:
$1,500
Poland first-year modeled cost = $66,530.40
The 36-month cost is:
($57,830.40 + $7,200) × 3 + $1,500
Poland 36-month modeled cost = $196,591.20
The base scenario excludes employer PPK contributions, supplementary benefits, recruitment expenses, and certain employee-specific costs.
Actual EOR legality and the employment arrangement must also be confirmed, particularly where temporary agency work rules could apply.
Official sources: ZUS — Employer and Employee Contributions and Polish State Labour Inspection.
India: The 2026 EPFO Wage-Ceiling Change Matters
India’s employment-cost structure must not be reduced to a flat percentage of gross salary.
Employer obligations depend on the employing establishment, employee eligibility, the statutory wage definition, contribution ceilings, and applicable employment laws.
One especially important 2026 change is the increase in the EPFO wage ceiling.
Effective September 17, 2026, the wage ceiling relevant to applicable EPF, EPS, and EDLI coverage and contributions increased from INR 15,000 to INR 25,000 monthly.
The change was confirmed by the Ministry of Labour and Employment and EPFO.
Official source: Government of India — September 2026 EPFO Wage-Ceiling Update.
India Model Assumptions
The employee’s monthly gross salary is INR 210,000.
The scenario assumes the employee is an existing covered EPF member and that the applicable employer contributions are calculated on a restricted INR 25,000 contribution base.
This is not an assumption that every newly hired employee earning INR 210,000 automatically enters mandatory EPF coverage.
The model also assumes an establishment subject to the usual 12% employer contribution rate, with no higher-wage contribution agreement.
Employer PF Contribution Example
| Component | INR per Month |
|---|---|
| Employer EPF/EPS contribution combined | 3,000 |
| EDLI at 0.50% of modeled base | 125 |
| EPF administration allocation at 0.50% | 125 |
| Total modeled employer monthly outlay | 3,250 |
Where EPS membership applies, the pension allocation is made from the employer’s contribution, not added on top of its 12% contribution.
Administrative charges are subject to establishment-level requirements and minimums. The table assumes any applicable establishment-level minimum is already satisfied and allocates the normal percentage-based amount to this employee.
India Annual Cost Calculation
Gross salary:
INR 210,000 × 12 = INR 2,520,000
Modeled employer EPFO outlay:
INR 3,250 × 12 = INR 39,000
Combined:
INR 2,559,000
Convert to USD at INR 90 per USD:
INR 2,559,000 ÷ 90 = $28,433.33
Add EOR administration:
$450 × 12 = $5,400
Add setup:
$1,500
India first-year modeled cost = $35,333.33
The 36-month cost is:
($28,433.33 + $5,400) × 3 + $1,500
India 36-month modeled cost = $103,000
What This Model Excludes
This is not a comprehensive India cost-to-company quotation.
Additional costs may arise from:
- Gratuity obligations and appropriate accounting provisions.
- Paid leave and leave encashment.
- State-specific labor and professional-tax requirements.
- Insurance and employee benefits.
- Employment-related bonuses and variable pay.
- Applicable establishment-level compliance obligations.
- EOR indemnities, deposits, and offboarding.
- Other employer contributions or benefits based on employee eligibility.
The actual EPF wage base must be determined using the current statutory definition and applicable rules, rather than treating total gross salary as automatically equivalent to contributory wages.
In India, gross salary, statutory wages, employee take-home pay, and total cost to company are distinct concepts.
A compliant employer-cost model must reconcile all four.
Philippines: The 13th-Month Pay Changes the Annual Salary Comparison
The Philippines illustrates why international compensation comparisons must not simply multiply monthly salary by twelve and stop.
For covered rank-and-file employees, statutory 13th-month pay is generally required.
The Philippine Department of Labor and Employment explains that it is calculated as one-twelfth of the employee’s basic salary earned during the relevant calendar year, subject to applicable rules.
Official source: DOLE — 13th-Month Pay Requirements.
Philippines Model Assumptions
The worker is a qualifying rank-and-file employee earning PHP 116,000 monthly.
The model includes:
- Twelve months of regular basic salary.
- One full 13th-month salary payment.
- Employer SSS contributions.
- Employer Employees’ Compensation contribution.
- Employer PhilHealth contribution.
- Employer Pag-IBIG contribution.
- EOR administration and one-time setup.
Employer Contributions
The Philippine Social Security System states that, effective January 2025, the relevant total SSS contribution is 15% of monthly salary credit, comprising 10% employer and 5% employee shares, with a maximum monthly salary credit of PHP 35,000.
For an employee above that ceiling, the modeled monthly employer SSS contribution is PHP 3,500.
The employer Employees’ Compensation contribution is PHP 30.
PhilHealth confirmed a 5% contribution rate for 2026, generally shared equally between employer and employee, with a PHP 100,000 maximum monthly income base.
For this employee, the employer PhilHealth amount is PHP 2,500 monthly.
The modeled Pag-IBIG employer contribution is PHP 200 monthly, based on the relevant PHP 10,000 maximum fund salary.
Official sources: SSS Contribution Schedule, PhilHealth 2026 Contribution Announcement, and Pag-IBIG Fund.
Philippines Monthly and Annual Payroll Model
| Component | PHP Amount |
|---|---|
| Monthly basic salary | 116,000 |
| Employer SSS | 3,500 |
| Employer Employees’ Compensation | 30 |
| Employer PhilHealth | 2,500 |
| Employer Pag-IBIG | 200 |
| Regular monthly employer outlay | 122,230 |
| Annual regular salary, 12 months | 1,392,000 |
| Additional 13th-month pay | 116,000 |
| Annual employer contributions, 12 months | 74,760 |
| Annual payroll expenditure | 1,582,760 |
The model assumes the worker completes a full year and qualifies for the full calculated 13th-month payment.
Convert annual payroll cost to USD:
PHP 1,582,760 ÷ 58 = $27,288.97
Add EOR administration:
$450 × 12 = $5,400
Add one-time setup:
$1,500
Philippines first-year modeled cost = $34,188.97
For 36 months:
($27,288.97 + $5,400) × 3 + $1,500
Philippines 36-month modeled cost = $99,566.90
The figure excludes any additional applicable benefits, leave liabilities, separation costs, insurance, recruitment, or contract-specific charges.
It should not be interpreted as the universal minimum cost of hiring a Philippines-based professional.
The Complete 12-Month Cost Reconciliation
The following table separates salary, statutory contributions, additional benefits, immigration or EOR fees, and one-time expenditure.
| Cost Category | US + PERM | Poland EOR | India EOR | Philippines EOR |
|---|---|---|---|---|
| Annual regular gross salary | $120,000 | $48,000 | $28,000 | $24,000 |
| Additional statutory 13th-month pay | — | — | — | $2,000 |
| Modeled employer statutory contributions | $9,180 | $9,830 | $433 | $1,289 |
| Other US benefits and administration | $14,400 | — | — | — |
| EOR recurring fees | — | $7,200 | $5,400 | $5,400 |
| Sponsorship costs | $15,315 | — | — | — |
| Equipment and onboarding/setup | $1,500 | $1,500 | $1,500 | $1,500 |
| Total | $160,395 | $66,530 | $35,333 | $34,189 |
Totals are calculated from unrounded underlying figures.
Importantly, the US scenario includes a $14,400 benefits and administration allowance, while supplementary foreign-market benefits and some jurisdiction-specific obligations are excluded from the foreign base cases.
The displayed total therefore represents a defined model rather than a complete like-for-like benefits or compliance quotation.
A real procurement exercise should add comparable levels of health benefits, recruitment, training, equipment, software, and other business-required support to each location.
The 36-Month Comparison
| Hiring Structure | Annual Recurring Cost | One-Time Costs | 36-Month Total |
|---|---|---|---|
| US employment + PERM | $143,580 | $16,815 | $447,555 |
| Poland EOR | $65,030 | $1,500 | $196,591 |
| India EOR | $33,833 | $1,500 | $103,000 |
| Philippines EOR | $32,689 | $1,500 | $99,567 |
The sponsorship expense is counted once, while wages and recurring administration continue throughout the employment period.
In reality, sponsorship cash payments occur at different procedural milestones, not necessarily all at commencement.
The 36-month results also do not assume that the employee has obtained permanent residence by the end of month 36.
The Most Important Adjustment: Cost per Productive Employee-Month
A low-cost foreign hire is not automatically an economically equivalent replacement for a US employee.
The employee may perform excellent work while having different available working hours, responsibilities, customer access, local knowledge, or legal authority.
Employers should therefore compare the cost of receiving a required level of business output.
The most useful metric is not simply annual salary.
It is the cost per effective productive unit.
Ivvora’s Adjusted Capacity Scenario
Assume, purely for sensitivity testing, that a given business requires 1.30 foreign employee equivalents to produce one unit of the output delivered by its reference US role.
This is an illustrative planning coefficient, not an empirical claim about employees in any country.
Using recurring annual costs, before one-time setup:
| Location | One Employee Annual Recurring Cost | Cost at 1.30 Employee Equivalents |
|---|---|---|
| United States | $143,580 | $143,580 reference |
| Poland | $65,030 | $84,540 |
| India | $33,833 | $43,983 |
| Philippines | $32,689 | $42,496 |
Even at 1.30 employee equivalents, the illustrative foreign staffing arrangements remain less expensive than the US reference scenario.
But the assumption must be established from the employer’s actual work requirements.
A distributed software engineering team may perform highly effectively across borders.
A US hospital position, licensed legal role, regulated-site function, customer-facing location requirement, or role requiring physical access to US facilities may not be transferable at all.
In such cases, the foreign option is not a lower-cost equivalent. It is a different job design.
The Productivity Break-Even Formula
Maximum Affordable Foreign Employee Equivalents = US Annual Recurring Cost ÷ Foreign Annual Recurring Cost
Under the model:
| Country | Mathematical Capacity Break-Even |
|---|---|
| Poland | 2.21 foreign employee equivalents |
| India | 4.24 foreign employee equivalents |
| Philippines | 4.39 foreign employee equivalents |
For example, the recurring annual spending for approximately 2.21 Poland-based employees equals that of one modeled US employee.
This does not suggest hiring fractional workers or assert that two Polish employees equal one American employee in performance.
It identifies the amount of foreign staffing expenditure that would exhaust the same annual budget.
Whether that staffing produces equivalent work is a separate operational question.
What Happens When the US Candidate Cannot Work Yet?
The earlier US cost model assumes work authorization is already available.
Now consider a very different case.
A US business identifies an overseas candidate who requires employer-sponsored permanent immigration and has no independent authorization to work in the United States.
The company initiates PERM, but the individual cannot begin the intended US employment until an appropriate work-authorized pathway becomes available.
Comparing the Two Business Situations
| Situation | US-Based Sponsored Candidate | Foreign Local Hire |
|---|---|---|
| Can begin working locally before immigration completion? | Only with separate valid US work authorization | Potentially, once local hiring requirements are satisfied |
| Does PERM permit immediate start? | No | Not applicable |
| Must wait for US immigrant visa availability? | If relying on that immigrant pathway, yes | No for purely local employment |
| Generates payroll while working? | Yes if lawfully employed | Yes if lawfully employed |
| Can fill work requiring US physical presence from abroad? | Not without appropriate US work authorization and presence | No |
| Can support remote deliverables internationally? | Possibly through a separately lawful foreign engagement | Yes, subject to the arrangement |
A company should not put twelve months of US wages into a comparison when the proposed employee cannot legally work in the United States during those months.
Likewise, the absence of salary expense while waiting is not an economic advantage if the business has an essential vacancy.
The vacancy may create lost revenue, delayed product delivery, temporary staffing expense, overtime, or customer-service disruption.
The Vacancy-Cost Formula
Total Vacancy Exposure = Months Unfilled × Monthly Economic Cost of the Vacancy
If a US role has an independently justified vacancy cost of $15,000 monthly, a twelve-month vacancy produces a modeled business impact of $180,000.
That $15,000 is a hypothetical business-impact assumption, not a payroll expense or a standard government estimate.
It should not be counted as a realized accounting loss without supporting business evidence.
The employer must estimate its actual consequences of an unfilled position.
This is why a $15,315 sponsorship budget may be less financially significant than the time during which the required work cannot be performed.
A Five-Employee Expansion: The Cost Difference Becomes Material
Now consider a US technology company planning to add five engineers.
For simplicity, assume all five employees meet the same salary and employment criteria and begin work at the start of the modeled period.
For the US case, each sponsored worker already possesses appropriate US work authorization.
Each requires an individually budgeted PERM and I-140 process.
For the foreign cases, all five are locally employed through a compliant EOR arrangement.
Five-Employee Team Cost
| Country | 12 Months | 36 Months |
|---|---|---|
| US + PERM for each employee | $801,975 | $2,237,775 |
| Poland EOR | $332,652 | $982,956 |
| India EOR | $176,667 | $515,000 |
| Philippines EOR | $170,945 | $497,834 |
These totals simply multiply the individual cost scenarios by five.
No EOR volume discount, shared onboarding saving, corporate management overhead, or internal staffing efficiency is assumed.
The US figure assumes five separate sponsorship budgets. Actual immigration recruitment and counsel engagements may have economies of scale, but PERM compliance still requires proper treatment of each position and case.
Why This Is Not a Straightforward Headcount Recommendation
Five local employees in the Philippines do not automatically substitute for five US employees.
The business must determine:
- Whether the duties can be performed from abroad.
- Whether employees require US customer or facility access.
- Whether time-zone overlap supports the operating model.
- Whether the employer can securely transfer data and intellectual property.
- Whether the foreign legal employment arrangement is compliant.
- Whether US licensing, export-control, contractual, or regulatory requirements restrict offshore work.
- Whether additional managers or support staff are necessary.
A staffing budget is only useful when it is connected to the services the company actually requires.
EOR Fees Versus PERM Costs: Why the Comparison Changes Over Time
PERM expenses are primarily process-related and episodic.
EOR administration fees are generally recurring while the employee remains with the provider.
This produces an important difference in cost structure.
Using the model’s regular-petitioner sponsorship budget:
PERM and I-140 modeled cost: $15,315.
Annual EOR administration alone:
- Poland: $7,200.
- India: $5,400.
- Philippines: $5,400.
At those prices, cumulative EOR administration fees exceed $15,315 after approximately:
| EOR Country | Monthly Fee | First Month Cumulative Fees Exceed $15,315 |
|---|---|---|
| Poland | $600 | Month 26 |
| India | $450 | Month 35 |
| Philippines | $450 | Month 35 |
The calculation deliberately excludes onboarding and all payroll pass-through costs.
It compares only one sponsorship-related budget with recurring provider fees.
This does not mean PERM becomes cheaper than international EOR at month 26 or month 35.
The employer would still pay US wages, payroll taxes, benefits, and any additional immigration-related expenses.
The comparison demonstrates how one-time and recurring service costs accumulate, not a true equivalence between the structures.
The Hidden Costs That Can Reverse a Hiring Decision
Recruitment and Employee Retention
Recruitment costs vary by specialization, country, agency, and candidate availability.
A company may spend more recruiting a scarce specialist abroad than hiring an available employee locally.
Retention costs also matter.
If employees leave frequently, onboarding, training, equipment, and recruitment expenses recur.
A low initial salary does not guarantee low long-term expenditure.
Employer of Record Contract Terms
The EOR invoice may include charges beyond the advertised monthly administration fee.
Possible costs include:
- Employee onboarding.
- Security deposits or payroll-funding reserves.
- Currency-conversion margins.
- Benefits administration.
- Payroll corrections.
- Offboarding and termination assistance.
- Immigration or work-permit support where applicable.
- Supplemental compliance services.
- Contract minimums.
Deposits should be accounted for according to whether they are refundable and when they are returned, rather than automatically treated as permanent expenses.
Taxable Presence and Corporate Structure
Employing people through an EOR does not guarantee that the foreign client avoids local corporate income tax or permanent-establishment exposure.
The analysis depends on the employee’s activities, authority, customer relationships, relevant tax treaties, and operating structure.
A remote employee who performs internal engineering work may present a different tax profile from a country manager who regularly negotiates contracts or exercises substantial commercial authority.
An EOR cannot contractually eliminate tax consequences arising from the underlying facts.
Wage Increases and Exchange Rates
The 36-month model holds local salaries and exchange rates constant.
Actual costs may change due to wage negotiations, statutory requirements, inflation, and currency movements.
If the local currency strengthens against the US dollar, a fixed local-currency salary can become more expensive in USD terms.
For example, the Poland model contains PLN 216,864 of annual payroll obligations before the USD-billed EOR fee.
At PLN 3.75 per USD, the payroll component costs $57,830.
If the hypothetical exchange rate becomes PLN 3.375 per USD, that component rises to approximately $64,256.
If it becomes PLN 4.125 per USD, it falls to approximately $52,573.
The difference arises without any change to the employee’s contractual PLN salary.
Labor-Law and Termination Obligations
Foreign employees may have statutory notice, leave, benefits, termination, and separation rights that differ from US rules.
The employer must consider the applicable local law and actual employment terms.
Provider fees do not necessarily include all statutory employment liabilities.
The cost of ending the employment arrangement should be included in an expansion or contingency plan.
Should a Company Hire Abroad While Sponsoring the Same Employee for the US?
An international business may want to employ a worker abroad while pursuing a future US immigration process.
Conceptually, these can be parallel arrangements:
- The worker performs an appropriately structured job abroad under the applicable local employment rules.
- A qualifying US employer pursues sponsorship for a genuine future permanent US position.
- The parties comply independently with the foreign employment arrangement and US immigration requirements.
- The worker begins performing the US job only when legally authorized.
This structure is not automatically permissible in every situation.
The US employer must comply with PERM’s actual job-opportunity, recruitment, and employer requirements.
The worker must satisfy the relevant immigration eligibility conditions.
The foreign role and proposed US role may have different work locations, employing entities, compensation, and duties.
If the employee later transfers to the United States, the employer must assess the termination or transfer of foreign employment, accrued benefits, and any continuing obligations.
A cross-border staffing plan should not assume that a future US visa or permanent residence will be available at a predictable date.
For beneficiaries subject to substantial priority-date backlogs, international employment may remain a long-term operational arrangement rather than a short bridge to relocation.
A Better Decision Framework: Four Questions Before Comparing Costs
First: Must the Work Be Performed in the United States?
If yes, the business needs an appropriately authorized US worker.
PERM may be part of a longer-term immigration strategy, but it cannot independently fill an immediate vacancy with a person lacking US work authorization.
International hiring should not be represented as a direct alternative if the work cannot move.
Second: Can the Role Operate Successfully From Abroad?
If the employee can work remotely, evaluate the actual operating requirements.
The employer should assess collaboration hours, output expectations, management structure, information security, customer requirements, and local legal compliance.
Third: Is the Objective Permanent US Residence or Workforce Capacity?
PERM is appropriate to consider where the employer has a genuine US permanent position and an eligible sponsorship strategy.
Foreign EOR hiring is appropriate to consider where the employer wants lawful labor capacity in another country.
The two objectives can coexist, but they remain different.
Fourth: Which Structure Has the Lowest Risk-Adjusted Cost?
A sound comparison should include:
Risk-Adjusted Employment Cost = Payroll + Employer Contributions + Benefits + Administration + Immigration Costs + Transition Costs + Expected Delay and Risk Costs
Not every risk can be converted into a precise dollar amount.
Where estimates are uncertain, employers should show low, base, and high scenarios instead of disguising assumptions as precise predictions.
Frequently Asked Questions
Is PERM sponsorship cheaper than hiring internationally?
Not necessarily.
PERM sponsorship costs are only one component of US employment expenditure.
Under Ivvora’s hypothetical model, the recurring salary and employment costs of the US position are much greater than the one-time immigration expense.
A foreign EOR arrangement can be less expensive for work genuinely performed abroad, but it does not replace a US-based job.
How much does PERM sponsorship cost an employer in 2026?
There is no universal total.
DOL does not charge a standard PERM application filing fee, but employers generally bear required labor-certification recruitment and their associated employer-side legal expenses.
An ordinary regular-petitioner I-140 filing has a $715 base fee plus a $600 Asylum Program Fee.
Ivvora’s illustrative combined PERM recruitment, legal, and I-140 budget is $15,315, excluding optional premium processing and other immigration expenses.
Who pays the PERM recruitment and attorney fees?
Under 20 CFR § 656.12(b), the employer generally must bear expenses related to obtaining permanent labor certification, including employer attorney fees and required recruitment costs.
The employer generally may not recover those expenses from the beneficiary through prohibited payments or wage deductions.
Can an employer sponsor someone living in India or the Philippines?
Yes, a qualifying US employer may pursue applicable employment-based immigration sponsorship for an eligible foreign beneficiary living abroad.
The underlying job must satisfy the relevant US immigration requirements.
Living abroad does not itself authorize the beneficiary to start work physically in the United States.
Does hiring an Indian employee in Poland avoid India’s US green-card backlog?
Ordinarily, no.
Employment-based immigrant visa chargeability generally follows country of birth, subject to applicable exceptions.
Working in Poland does not usually change an India-born beneficiary’s chargeability.
Does PERM approval give the worker a US work permit?
No.
PERM labor certification is not work authorization.
The worker must independently possess or obtain authorization to perform the intended US employment.
Can a US business hire employees abroad without opening a local company?
Potentially, through a lawful EOR arrangement or another permissible local employment structure.
The correct arrangement depends on local employment, tax, licensing, and regulatory rules.
Using an EOR does not eliminate the client’s need to evaluate local tax and operational consequences.
Is hiring in the Philippines cheaper than India?
Not universally.
The outcome depends on role, skill requirements, location, employee compensation, statutory benefits, provider pricing, and exchange rates.
Ivvora’s illustrative first-year Philippines cost is $34,189 versus $35,333 for India, but that difference is driven by specified assumptions and is not evidence of a universal market-wide ranking.
How long does PERM take in 2026?
The DOL reported an average of 336 calendar days for analyst-review determinations issued in August 2026.
That figure represents the PERM adjudication stage, not the entire process from initial prevailing wage request through immigrant visa issuance or permanent residence.
Actual timing may be significantly different, particularly where audits or visa-number backlogs apply.
Does premium processing eliminate PERM delays?
No.
Eligible I-140 premium processing accelerates USCIS action on the immigrant petition.
It does not accelerate DOL recruitment, PERM certification, or the availability of an immigrant visa number.
Can a US company hire someone abroad and sponsor them simultaneously?
In some circumstances, yes.
The foreign employment arrangement and US immigration sponsorship must independently satisfy their applicable rules.
The business should document the legal employer, location of work, employment terms, future US job opportunity, and relevant immigration strategy.
Final Verdict: The Cheapest Hiring Location Is Not Always the Correct Hiring Structure
Ivvora’s modeled 2026 employer expenditure is $160,395 for the first year of a US employee receiving PERM sponsorship, compared with $66,530 in Poland, $35,333 in India, and $34,189 in the Philippines under the specified foreign EOR assumptions.
Over 36 months, the difference becomes much larger because salaries, employer contributions, and administration recur.
But the result has three important limitations.
First, PERM and foreign hiring do not supply the same legal outcome. PERM supports a future permanent US job and associated immigration process. Foreign EOR employment supplies workforce capacity in another jurisdiction.
Second, US immigration timing matters. PERM approval and I-140 approval do not automatically create work authorization or eliminate immigrant visa backlogs.
Third, a lower salary is not automatically a lower cost for equivalent business output. Employers must evaluate role requirements, productivity, management, compliance, and operational constraints.
For work that genuinely must be performed in the United States, international hiring cannot simply replace the necessary US workforce.
For work that can legally and effectively be delivered from another country, the business can compare international employment structures, payroll costs, and providers on their own merits.
The strongest hiring decision is not the option with the lowest quoted monthly salary.
It is the arrangement that meets the company’s actual workforce requirement at the lowest defensible total cost and acceptable legal and operational risk.
Sources and Calculation Methodology
Research date: October 18, 2026.
Model author: Ivvora Research — International Employment and Employer Cost Intelligence.
Official US Immigration and Employment Sources
- US Department of Labor — Permanent Labor Certification (PERM). Primary rules and process for prevailing wage, recruitment, and labor certification.
- DOL FLAG — Processing Times. Official PERM and prevailing wage processing indicators used for October 2026 analysis.
- USCIS — Filing Fee Schedule. Form I-140 base filing fee and applicable additional fee categories.
- US Department of Homeland Security — 2026 Premium Processing Fee Rule. Establishes the March 1, 2026 premium-processing fee adjustment.
- US Department of Labor — PERM Employer-Payment Rule. Regulatory discussion and requirements regarding employer payment for labor-certification costs.
- US Department of State — October 2026 Visa Bulletin. Employment-based final action dates.
- Internal Revenue Service — FICA Tax Rates. Employer Social Security and Medicare rates.
- Social Security Administration — 2026 Contribution Base. Confirms the 2026 Social Security taxable wage limit of $184,500.
Official Poland Sources
- ZUS — Social Security Contributions. Employer and employee insurance contributions.
- Polish State Labour Inspection. Employment regulation and temporary agency work guidance.
Official India Sources
- Government of India — EPFO Wage-Ceiling Revision. September 2026 revision of the statutory wage ceiling and related contribution framework.
- Employees’ Provident Fund Organisation. Official contribution and scheme administration information.
Official Philippines Sources
- Philippine Social Security System — Contributions. Employer and employee contribution shares and salary-credit limits.
- Philippine Information Agency — PhilHealth 2026 Premium Rates. The 2026 premium rate and applicable income ceiling.
- Pag-IBIG Fund. Housing fund membership and contribution rules.
- Department of Labor and Employment — 13th-Month Pay. Statutory 13th-month pay calculation and covered workers.
Reproducibility Notes
The model uses the following fixed assumptions:
- US annual salary: $120,000.
- Poland monthly gross salary: PLN 15,000.
- India monthly gross salary: INR 210,000.
- Philippines monthly basic salary: PHP 116,000.
- Currency conversion: USD 1 = PLN 3.75, INR 90, or PHP 58.
- Monthly EOR fees: $600 in Poland; $450 in India and the Philippines.
- Foreign one-time onboarding and equipment: $1,500.
- US recurring benefits and other administration allowance: $14,400 annually.
- US sponsorship budget: $15,315, counted once.
- No annual salary increases, FX movements, fee escalation, headcount changes, employee turnover, or legislative changes during the modeled period.
Formula:
Total employer cost over T years = T × (annual gross salary + applicable modeled annual employer contributions + recurring benefits and administration + EOR fees) + one-time setup + modeled sponsorship costs.
The Philippines salary calculation adds the applicable modeled 13th-month benefit to annual gross salary.
The India calculation assumes an eligible continuing EPF-covered employee using the revised INR 25,000 contribution base and specified contribution treatment. The EOR is assumed to have sufficient covered workers for the ordinary establishment-level administration calculation.
Some statutory and employment-related costs are excluded where the worker’s eligibility, contract, state or regional law, establishment status, or provider arrangement has not been specified.
The model should therefore be used for structural comparison and scenario analysis, not as a binding hiring quotation or a complete statutory payroll assessment.
Before implementing an employment or immigration arrangement, obtain country-specific legal advice, a prevailing wage determination where required, actual employee compensation proposals, and itemized provider quotations.
Ivvora Research | Updated October 18, 2026
Ivvora provides research and planning information. Country-specific legal, employment, tax and payroll decisions should be reviewed against current requirements and the facts of the individual case.
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