Umbrella company: what is it and how does it differ from the French EOR complete solution?

Are you a freelance professional planning to relocate or take on assignments in the UK? Wondering how an umbrella company works and whether this option could be a good fit for you?
Don’t worry — 2iPortage breaks down everything you need to know about this model, a close cousin of the French EOR complete solution.

Umbrella company: a popular status among UK independent professionals

Highly popular across the Channel, the umbrella company is one of the favourite solutions used by UK freelancers to carry out their activity.
But what exactly is an umbrella company? How does it work? 2iP has the answers!

What is an umbrella company?

An umbrella company (sometimes called a “société parapluie”) is a company that employs independent contractors and gives them access to employee status.

As with the French EOR complete solution, this model is designed for a wide range of professionals — consultants, temporary workers, contractors, as well as musicians and many other occupations.

Its operating model is very similar to what we know in France: the freelancer signs an employment contract with the umbrella company, which then assigns them to client organisations.
However, when you look a little closer, you’ll see that the two solutions don’t work quite the same way.

How does an umbrella company work?

The way an umbrella company works is quite straightforward:

1. The freelancer finds an assignment with a client company, most often through a recruitment agency.
2. They sign an employment contract with an umbrella company.
3. The freelancer completes their assignment for the client and reports their working hours to the umbrella company.
4. The umbrella company invoices the client and then pays the freelancer’s salary, after deducting social contributions and management fees.

The umbrella company therefore acts purely as an intermediary, taking on all the administrative responsibilities linked to employing an independent professional (employment contract, payslips, tax withholding, etc.).
This setup comes with several notable advantages.

Advantages and disadvantages of an umbrella company

As you might expect, like any professional status, working through an umbrella company comes with both advantages and drawbacks that should be carefully considered before getting started.

Advantages	Disadvantages
Simplicity: you can focus entirely on your core activity, as the umbrella company handles all administrative tasks. Flexibility: you can move from one assignment to another with complete ease. Security: you benefit from employee social protection (health insurance, unemployment benefits, pension, etc.). Income stability: your salary is paid regularly, even between assignments.	Cost: the umbrella company’s management fees add to other mandatory deductions. Dependence: you rely on the umbrella company, which oversees your schedule and salary. Limited coverage: certain professional expenses are only partially reimbursed — or not covered at all. Networking: you still need to approach agencies and clients yourself.

If you’re already familiar with the French EOR complete solution (PS), you’ve probably noticed a few similarities between the two systems. However, when you look more closely at what the French EOR complete solution is and how it works, you’ll quickly see that the two models are not exactly the same. So let’s take a closer look at how the French EOR complete solution works to understand the differences clearly.

The French EOR complete solution: the French alternative to umbrella companies

In France, the equivalent of an umbrella company is the French EOR complete solution. Introduced in the 1980s, this model has become highly popular among French independent professionals seeking a more protective status.

What is the French EOR complete solution?

The French EOR complete solution is a system that allows an independent professional to benefit from employee status while being employed by a portage company.
This company handles all administrative and legal aspects related to their activity, including:

• employment contract,
• payslip,
• social declarations,
• client invoicing…

In return, the contractor pays a percentage of their revenue (usually between 5% and 10%) to the portage company as management fees.
However, they remain fully autonomous in their business development, client acquisition, and daily activity management.

How does the French EOR complete solution work?

The French EOR complete solution operates through a three‑party relationship involving the independent consultant, the portage company, and the client organisation:

1. The consultant finds their own clients and negotiates the terms of the assignment (scope of work, duration, daily rate, etc.).
2. They sign an employment contract (either permanent or fixed‑term) with the portage company, which officially employs them.
3. They carry out their assignment for the client.
4. The portage company invoices the client for the assignment and then pays the consultant’s salary, after deducting management fees and social contributions.

Throughout their collaboration with the portage company, the consultant benefits from a wide range of services: management tools, training, insurance, health coverage, legal support, personalised guidance… all of which can be highly advantageous.

Advantages and disadvantages of the French EOR complete solution

As you’ve probably already understood, the French EOR complete solution offers many advantages for independent professionals. However, it also comes with a few drawbacks that you should be aware of before choosing this option.

Advantages

Disadvantages

Administrative simplicity: the portage company handles all management tasks (contracts, payslips, etc.). Social protection: the consultant benefits from the same level of coverage as a traditional employee. Financial stability: income is smoothed over time, even during periods with fewer assignments. Support services: the consultant receives day‑to‑day support. Tax benefits: under certain conditions, consultants may qualify for specific tax advantages.

Cost: management fees mechanically reduce the consultant’s net income. Restrictions: some professions are not eligible for the French EOR complete solution.

What are the differences between the French EOR complete solution and an umbrella company?

While the French EOR complete solution and umbrella companies address similar needs, the two models differ in several important ways:

	French EOR complete solution	Umbrella company
Country	🇫🇷 France	🇬🇧 United Kingdom
Contracting	Tripartite	Quadripartite
Minimum salary	✔️ Yes	❌ No
Management fees	% of revenue	Fixed fee
Eligibility	Restricted	Open
Administrative management	Portage company	Umbrella company

In practical terms, the French EOR complete solution stands out through:

• a three‑party contractual relationship (consultant / portage company / client).
• a legally mandated minimum salary ( €2,517.13 gross per month in 2024).
• management fees calculated as a percentage of revenue (between 5% and 10%).
• eligibility criteria that apply under specific conditions.

The UK umbrella company, on the other hand, is characterised by:

• a four‑party contractual relationship (consultant / agency / umbrella company / client).
• the absence of a minimum salary requirement.
• fixed‑rate management fees.
• open eligibility for all types of professionals.

With all this in mind, if you’re a self‑employed professional in France wanting to work in the UK — or the other way around — it’s perfectly normal to wonder which of the two statuses is the better choice…

Umbrella company or French EOR complete solution: which option should you choose?

If you’re considering working abroad as an independent professional, you’re probably wondering whether it’s better to use a UK umbrella company or rely on a French EOR complete solution. And the reverse is just as true if you’re a UK‑based contractor planning to work in France.

In reality, the right solution will depend on several criteria:

• The duration of your assignment: if it’s a short mission lasting only a few days or weeks, it’s often easier to stay under the French EOR complete solution and request a détachement through your portage company. For longer international assignments that span several months, using an umbrella company can be a more suitable option.
• The legislation of the host country: the umbrella company model exists in many parts of the world, and some countries require foreign freelancers to operate through a local structure in order to work legally on their territory. This is notably the case in Saudi Arabia or the United Arab Emirates. In Europe, the rules are generally more flexible, but it’s important to check the specific requirements in each country.
• Your specific needs: depending on your personal and professional situation, you may find it more beneficial to join an umbrella company abroad — or a French EOR complete solution if you plan to settle in France. This is especially true if you need legal and administrative support in your host country, local social protection, or a specific service tailored to your activity.

Whatever option you choose, it’s essential to fully understand the tax and social implications of your international project before moving forward.

And the good news is that whether you’re a foreign independent professional wanting to work in France, or a French consultant planning to take on assignments abroad, 2i Portage is here to support you every step of the way!

2i Portage: supporting you in all your projects in France and abroad

Do you have a project to transition to freelancing or to work abroad? 2iP, a subsidiary of 2i Group, is here to support you throughout every step of the process!

Thanks to our network of national and international partners, we can guide you towards the best solutions depending on your project:

• International assignments: our mobility service handles all administrative formalities related to your détachement (contract, social declarations, insurance, etc.) so you can focus on your mission with complete peace of mind.
• International French EOR complete solution: if you live abroad but work for French clients, we can support you through our international French EOR complete solution model. This allows you to benefit from our expertise and services while remaining compliant with the legal obligations of your country of residence.

With more than 15 years of experience supporting independent professionals, we stand by your side to secure your activity — wherever you are in the world.

So don’t hesitate to reach out to us to discuss your project and receive personalised guidance. Our team is here to help!