How to Hire in Paraguay Without Opening a Company (EOR Guide 2026)

Want to hire one or two people in Paraguay before you commit to a local company? An employer of record (EOR) lets you do that. This guide explains how it works, what Paraguayan law requires from any employer in 2026, and when it makes sense to set up your own company instead.

What is an employer of record?

An EOR is a local company that becomes the legal employer of your team in Paraguay. It signs the employment contract, runs payroll, pays social security and handles labor filings. You direct the employee’s daily work and pay the EOR a service fee.

What employing someone costs in Paraguay

• Minimum wage: G. 3,044,000 a month for unspecified activities from 1 July 2026 (Decree 6225; MTESS Resolution 670/2026).
• IPS social security: 16.5% paid by the employer and 9% withheld from the employee (general regime).
• Aguinaldo: one twelfth of the year’s pay, by 31 December.
• Vacation: paid annual leave that increases with seniority under the Labor Code.

Contracts and registration

• A written employment contract under the Labor Code, registered with the Ministry of Labor, Employment and Social Security (MTESS).
• Registration of the employee with the IPS from the first day of work.
• Probation, working time and overtime rules set by the Labor Code.

Ending employment

Dismissal without just cause requires notice, which grows with seniority, or pay in lieu, plus severance under the Labor Code. Workers who reach ten years of service gain special job stability. Plan for these costs even when an EOR is the employer, because they are passed on to you.

When an EOR makes sense

• You are testing the market with one or a few hires.
• You need someone on the ground quickly, such as a country manager or a support agent.
• You are not yet ready to run local accounting and tax filings.

When to set up your own company

• Your team grows, so the EOR fees outweigh the cost of running a company.
• You will invoice clients in Paraguay or sign local contracts in your own name.
• You want to hold assets, open a corporate bank account or build a long-term presence.

Most foreign founders use an EAS, which allows one shareholder and has no minimum capital. Set up your own company in Paraguay, see recruiting and hiring in Paraguay, or compare the options on our employer of record and PEO services in Latin America page.

Get help from Easyco

Easyco coordinates the company setup in Paraguay up to the issue of the RUC, and supports companies afterwards with tax, accounting, payroll and company compliance, including a registered office address. Request a quote.