An Agent of Record (AOR) is a third party that engages contractors on your behalf, signs contracts under their entity, and absorbs the compliance risk of the engagement. An AOR is particularly useful when onboarding freelancers in high-risk classification markets like Spain, Brazil, or the wider EU, when entering new geographies where local laws are unfamiliar, or when managing large pools of contractors across multiple countries where building in-house compliance knowledge for each jurisdiction is not practical.

Classify based on the reality of the engagement, not the contract label. Control over hours, methods, and exclusivity are the biggest red flags. Centralize the decision rather than leaving it to individual managers, and revisit it whenever a contractor's scope changes.