Nearshore talent is cheaper than a US hire almost no matter how you buy it. But the fee your provider layers on top can quietly claw back a big chunk of those savings, and the way that fee is structured, flat or percentage, is the single biggest lever most buyers overlook. Below, we compare the two dominant pricing models head to head, show the real dollar difference on a typical hire, and give you the questions that expose the hidden markup before you sign.
Want the underlying pay data first? See our Colombia Tech Salary Report 2026 for 2026 salary ranges across every role we place.
The Two Pricing Models You'll Actually See
Strip away the branding and nearly every nearshore staffing quote falls into one of two structures.
- Percentage of salary. The provider's fee is a percentage of the hire's compensation, either a one-time placement fee (commonly 15–25% of first-year salary) or a recurring markup baked into every invoice (common in staff augmentation and "managed" models, where you never see the developer's actual pay).
- Flat fee. The provider charges a fixed dollar amount that doesn't move with salary, either a one-time per-hire fee for recruiting, or a fixed monthly fee per contractor for payroll and compliance.
Both can deliver the same developer. The difference is who captures the upside when you hire someone excellent, or scale from one hire to ten. With percentage pricing, the provider does. With flat pricing, you do.
How Percentage-of-Salary Pricing Works
Percentage pricing comes in two flavors, and it's worth knowing which one you're being quoted.
One-time placement fee
Classic recruiting agencies charge a percentage of the candidate's first-year salary, typically 15–25%, due once when the hire starts. Simple, but it scales with pay: the better the hire, the bigger the check, even though sourcing a senior engineer isn't proportionally harder than sourcing a junior.
Recurring percentage markup
Staff-augmentation and "managed" providers often bundle the developer's pay and their margin into a single blended rate. You're told the hire "costs" $X per month; a slice of that, frequently 30–50% or more, is the provider's recurring markup. Because it repeats every month for as long as the contractor stays, the lifetime cost can dwarf any one-time fee, and it's the hardest model to audit because the underlying salary is hidden from you.
How Flat-Fee Pricing Works
Flat-fee pricing charges for the work performed, not for a share of your payroll. The number is the same whether the salary is $30,000 or $90,000.
- Sourcing (shortlist only): $1,800 per role, no subscription. The provider runs the search and delivers a screened, English-checked shortlist; you run your own interviews and hire directly.
- Recruiting (junior to mid, up to 3 years): $2,500 per hire, with a 3-month replacement guarantee. Sourced, assessed, and placed.
- Recruiting (senior and specialist, 3 years+): $3,500 per hire, with a 3-month replacement guarantee and salary benchmarking before the search.
- Contractor of Record (COR): from $99 per contractor per month, so you can pay talent compliantly in Colombia without opening a local entity, at a fixed rate that doesn't rise with salary.
Those are Nearwork's published rates, and they're deliberately flat: we never take a percentage of salary. It's the core reason our pricing stays predictable as you hire more senior people. You can see the full breakdown on our pricing page.
Flat Fee vs. Percentage: The Real Dollar Difference
The gap is small at low salaries and enormous at high ones. Here's a like-for-like comparison of a one-time 20% placement fee against a flat per-hire recruiting fee, across three seniority levels.
| Hire | Annual salary | 20% placement fee | Flat fee (Nearwork) | You save |
|---|---|---|---|---|
| Junior developer | $24,000 | $4,800 | $2,500 | $2,300 |
| Mid-level developer | $45,000 | $9,000 | $2,500 | $6,500 |
| Senior developer | $70,000 | $14,000 | $3,500 | $10,500 |
Illustrative. Placement-fee percentages vary by agency (15–25% is typical); salaries are 2026 market estimates, not quotes.
The pattern is clear: the more valuable the hire, the more a percentage model costs you, for identical work. Now stack a recurring markup on top. A contractor billed with a 40% monthly margin on a $5,000/month cost carries roughly $2,000/month, or $24,000/year, in provider markup, every year they stay. A flat COR fee for the same compliant engagement is a fraction of that.
The Hidden Markup in Percentage Pricing
Percentage fees aren't inherently dishonest, but they create incentives worth understanding before you sign.
- You're taxed for hiring well. A percentage fee rises every time you pick a stronger, better-paid candidate, penalizing exactly the decision you want to make.
- Raises cost you twice. With recurring-markup models, giving your contractor a raise also raises the provider's cut, so you pay a premium on your own generosity.
- The real rate is often invisible. Blended-rate models hide the developer's actual pay, making it impossible to know your true margin or whether the person is fairly compensated.
- It compounds at scale. One hire's difference is a few thousand dollars. A team of ten, retained for years, is where percentage pricing quietly becomes one of your largest line items.
Questions to Ask Before You Sign
Five questions cut through the pitch and reveal what you'll really pay.
- Is your fee a flat amount or a percentage of salary? If percentage, is it one-time or recurring?
- Will you show me the developer's actual pay? Transparency here signals a flat, honest model.
- Does the fee change if I hire someone more senior? With a flat fee, it shouldn't.
- What happens to the fee when I give a raise or scale the team? This exposes recurring markups.
- Is there a replacement guarantee, and does it cost extra? A good provider caps your downside without another percentage.
Nearwork answers all five the same way: flat fees, full transparency, no percentage of salary, and a 3-month replacement guarantee built in. With 1,000+ placements across 40+ US and Canada companies since 2024, our developers are verified at C1 English and work in compatible US time zones, so you get the savings without the offshore trade-offs. Want the number for your specific role? Our cost calculator gives you an estimate in a couple of minutes.
FAQ
How is nearshore staffing usually priced?
Two main models dominate. Percentage-of-salary pricing charges a placement fee equal to 15–25% of the hire's first-year salary, or a recurring markup on top of every paycheck. Flat-fee pricing charges a fixed dollar amount per hire (or a fixed monthly fee for contractor-of-record), regardless of the salary. Flat fees are usually cheaper and more predictable, especially for senior roles.
Is a percentage-of-salary fee or a flat fee cheaper?
A flat fee is almost always cheaper for mid and senior hires. A 20% placement fee on a $60,000 salary is $12,000; the same role through a flat-fee provider like Nearwork costs $2,500–$3,500 per hire. Percentage pricing only looks competitive at very low salaries, and it penalizes you for hiring better people.
What is the hidden cost of percentage-based staffing fees?
Percentage fees scale with salary, so every raise, senior hire, or specialist you add increases the provider's cut, even though their work is the same. Recurring percentage markups (common in staff augmentation) also compound month after month, so the lifetime cost of a single contractor can far exceed a one-time flat fee.
How does Nearwork price nearshore hires?
Nearwork uses flat fees, never a percentage of salary. Sourcing is $1,800 per role, recruiting is $2,500 per hire (junior to mid) or $3,500 per hire (senior and specialist) with a 3-month replacement guarantee, and Contractor of Record starts at $99 per contractor per month. The price is the same whether the salary is $30,000 or $90,000.
Why do so many staffing agencies charge a percentage of salary?
Because it maximizes their revenue as your salaries grow, not because it reflects their cost. Sourcing and vetting a senior engineer is not proportionally more expensive than a junior, so a flat fee more honestly reflects the work involved and keeps your cost predictable as you scale.
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