The three routes
A local entity gives you full control at high cost and months of setup. An employer-of-record employs the person on your behalf for a monthly fee. A contractor agreement is fastest and carries the most legal risk.
The misclassification risk
If the person works fixed hours, uses your systems and reports to your manager, many jurisdictions will treat them as an employee regardless of the contract. Penalties fall on you, not them.
How to choose
One or two people in a country: EOR. A team of ten or more with long-term plans: consider an entity. Genuinely project-based work with an independent supplier: contractor.
Common questions
What is the fastest way to hire abroad?
An employer-of-record, usually within a couple of weeks, without setting up a local entity.
Can we just pay someone as a contractor?
Only if the working relationship is genuinely independent. Misclassification penalties fall on the employer.