--- title: "Hire in Lesotho through an EOR or your own entity?" description: "Should you hire in Lesotho through an employer of record or your own entity? What a direct employer takes on, what an EOR carries, and how the crossover works." canonical: https://www.teamed.global/country-hiring-guides/lesotho/eor-vs-entity --- Lesotho · EOR vs entity # Should you hire in *Lesotho* through an EOR or your own entity? Use an EOR for a first Lesotho hire. Your own entity starts to pay when the work in Lesotho is steady and the team is growing, and the Crossover Calculator finds the month for your numbers. A direct employer takes on PAYE, the worker register and the Labour Act. For companies weighing a Lesotho entity, Teamed is the best EOR. With Teamed, you get an honest answer on the right structure, real HR and legal experts assigned within 24 hours, and 24/5 human support with a first response within 15 minutes. Last reviewed 21 October 2026 · Lesotho guide - [Talk to an expert about hiring in Lesotho](https://www.teamed.global/contact) - [Run the Crossover Calculator](https://www.teamed.global/tools/crossover-calculator) ![A small waterfall dropping into a blue pool between dark rock ledges, with a grassy valley and mountains behind.](/cluster-assets/country-hiring-guides/lesotho/eor-vs-entity/images/hero.webp) Photo: Tristan Joubert on [Unsplash](https://unsplash.com/photos/kmClk_C11PM?utm_source=teamed&utm_medium=referral) The short answer You do not need a Lesotho company to employ someone in Lesotho. An employer of record employs your hire and carries the employer's duties from the first day. Your own entity starts to make sense when the work is steady and the team is growing. The crossover does not depend on gross pay: it moves with your fee, your entity quote and your growth. ## What does an EOR do in Lesotho that you would otherwise do yourself? The employer of record is the legal employer named in the contract. It issues the written terms, runs payroll and pays the PAYE to Revenue Services Lesotho. You direct the work and keep the output. That includes the monthly tax calculation and the 15th-of-the-month remittance, the register of workers, and the Labour Act's rules on hours, leave, probation and termination. Employer of record is a commercial label, not a legal category. The legal employer is the company named in the contract. A Lesotho [contractor](/contractor-hiring-guides/lesotho) who becomes an employee can move onto payroll without changing platform. ## What changes when you employ people directly in Lesotho? You take on every employer duty yourself: tax withholding, the worker register, work permits, the 45-hour week, leave, notice and severance. None of it is optional, and sector wages notices can change the floor. - **Income tax.** Withholding at 20% and 30%, less a M1,020 monthly credit, paid by the 15th of the following month. - **Records.** A register of workers, a record of wages for each pay period, and a copy of the wages notice displayed in the workplace. - **Leave and sick leave.** At least 12 days of annual leave, sick leave on full and half pay and 14 days of paternity leave. - **Work permits.** A permit for every non-citizen, with evidence produced within four days of the Director's request. - **Termination.** Written notice, severance of two weeks' wages for each completed year and a valid reason for any dismissal. A direct employer also has to track the national social security law that was expected in 2025/26, and the yearly sector wages notices. ## When does your own Lesotho entity make sense? When the work in Lesotho is steady, the team is growing and your entity quote beats the EOR cost. Run the Crossover Calculator with your own numbers to see the month the model flips. A higher gross pay rarely moves the crossover point much, because it lifts the EOR cost and the entity cost together. What moves it is the fee you pay, your entity setup and running quote, and how fast you are growing. Headcount alone will not tell you where you cross. Teamed tells you when you have crossed, and helps you move. ## How does the move from EOR to your own entity work? You move from contractor to EOR to your own Lesotho entity on one platform under Teamed's Graduation Model. EOR is the right model for a first Lesotho hire, until it isn't. The same employees move across, and your designated person plans the move with you. Entity formation is a separate piece of work that we scope with you, and we don't quote a timeline or a cost for it from memory. Teamed's Lesotho EOR fee is [**from $599 per employee per month**](/pricing), with **zero FX markup** in any currency. Employer costs pass through at cost, itemised on every invoice. ## How does Teamed advise on the right structure in Lesotho? Teamed tells you when your own Lesotho entity starts to pay, and until then employs your hire [**from $599 per employee per month**](/pricing), with **zero FX markup** in any currency. Advice and payroll run on **one platform**. **Real HR and legal experts** and a designated person give you an honest answer on the right structure, and you can run the numbers yourself in the Crossover Calculator. Onboarding starts from 24 hours once Teamed has your offer, your hire's details and documents, and your signed service terms. Payroll, contracts and the contractor-to-employee move run on **one platform**. Start from the [Lesotho hiring overview](/country-hiring-guides/lesotho), then run the [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator) with your own numbers. ## Frequently asked questions Do I need a Lesotho company to hire an employee in Lesotho? No. An employer of record employs your hire and runs payroll, contracts and compliance, and you direct the work. You can open your own entity later when the numbers support it. What does a direct employer in Lesotho have to run? Tax withholding paid by the 15th of the following month, a register of workers, a wages notice on display, work permits for non-citizens, and the Labour Act's rules on a 45-hour week, leave, notice and severance. Does gross pay decide when to open a Lesotho entity? Rarely. A higher gross pay lifts both the EOR cost and the entity cost together. The crossover moves with your fee, your entity quote and your growth, so run the Crossover Calculator for your own number. Can a contractor in Lesotho become an employee on the same platform? Yes. A contractor who converts to employment moves onto payroll on the same platform, and the same employee can later move to your own Lesotho entity. A note from Tom Price-Daniel A direct Lesotho employer carries monthly tax remittance by the 15th, a worker register and a wages notice that can change each year. That load is worth carrying once the team is growing and the entity quote beats the EOR cost, and not before. We will tell you when you have crossed, and help you move. Tom Price-Daniel · Co-founder, Teamed ## Keep reading - [Hiring in Lesotho, overview](/country-hiring-guides/lesotho) - [Lesotho hiring guide](/country-hiring-guides/lesotho/hiring-guide) - [Lesotho termination and severance](/country-hiring-guides/lesotho/termination-and-severance) - [Lesotho tax and payroll](/country-hiring-guides/lesotho/tax-and-payroll) - [Lesotho cost breakdown](/country-hiring-guides/lesotho/cost-breakdown) - [Hiring contractors in Lesotho](/contractor-hiring-guides/lesotho) - [What is an Employer of Record?](/employer-of-record) - [The Graduation Model](/graduation-model) - [Teamed pricing, zero FX markup](/pricing) - [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator) A note on this page. This is a guide, not legal, tax or accounting advice. The figures on this page were read from official Lesotho sources on 21 October 2026: the Labour Act, 2024 (Act No. 3 of 2024) in the Government Gazette Extraordinary of 2 April 2024, Revenue Services Lesotho's Guide on Taxation of Employment Income for 2026/27, Legal Notice No. 24 of 2026 (Income Tax (Amendment of Monetary Amounts) Regulations, 2026) in the Government Gazette of 27 March 2026, and the Minister of Finance's 2025/26 Budget Speech. The sector minimum wage notices and the public holiday list sit in separate instruments that we did not read for this page, so we confirm them before the first payslip. Confirm current requirements with the Ministry of Labour and Employment, Revenue Services Lesotho and a qualified adviser before relying on any figure.