With the EOR business model, Deel is the legal employer of employees on the client's behalf.
To ensure we provide the best possible experience for the client and their employees, we charge a deposit for each EOR hired.
The deposit is always invoiced and refunded in the currency of the location of the EOR. Foreign exchange rates will be applied if payment and refunds aren't processed in the designated currency.
How are Deposits Calculated?
The standard deposit is between 1 - 1.5 all monthly charges, including employee salary, employer costs, fixed allowances, and management fees.
Amendments to the EOR contract and transferring an EOR also affect how the deposit is calculated.
If the deposit exceeds the total amount of the final invoice, it can be used to settle the invoice, and any remaining amount will be refunded.
If the deposit amount is lower than the final invoice, the amount will be held against the client's account and refunded once the final invoice is settled upon termination of the EOR contract or resignation of the EOR.
Note: in some countries where there is an increased risk of financial repercussions from terminations, deposit amounts may be higher.
When Would Deel Require A Larger Deposit?
In some circumstances, Deel may increase the deposit in order to accommodate certain requests, including contract amendments or as a result of Deel policies.
[ACCORDION]Request to remove the probation
A two month deposit is charged for this request. This applies to both monthly and bi-monthly payroll countries.
[ACCORDION]Offering a particular PTO amount above the legal minimum
If the client wishes to offer a specific PTO amount exceeding the legal minimum by more than 8 days, the deposit required will also be two months of the monthly salary (2X)
This doesn't apply to sick leave, as sick leave is defined by country. If that changes, it won't affect the deposit
[ACCORDION]Increasing notice period beyond one month
For this request, each month added will equal an additional month's deposit.
For example: if the notice period is 3 months then the deposit charged will be 3 months.
[ACCORDION]Transferring an EOR with some of their accrued benefits (PTO, seniority, or severance)
A two month deposit is charged for this request.
[ACCORDION]Adding an incentive plan or a variable compensation above $100k
For this request, we will review and determine the amount to be paid for the deposit.
Note: for Israel, France and the Netherlands, a deposit for the full amount of the IP and VC is needed.
[ACCORDION]Increasing salary and recurring fixed allowance
If the salary increase or the recurring fixed allowance is above 20%, the deposit increase will be proportional to the percentage change.
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Deposit Refunds
We will refund the deposit once the EOR resigns or their contract is terminated after any outstanding invoices have been settled. For resignations, we require a signed resignation letter from the employee and the final invoice payment.
The deposit will only be used to cover the final invoice if the deposit total exceeds the invoice amount. If the final EOR invoice is offset by the deposit, only the remaining portion of the deposit will be refunded.
If the deposit does not fully cover the final invoice amount, clients are responsible for settling any outstanding balance, including the final invoice, before the deposit is refunded.
The final invoice includes:
- Final salary
- Any unused vacation
- Any severance pay the EOR was legally entitled to, or that the client wishes to pay out
- Any outstanding Deel fees
We will refund the deposit in the same currency as the bank account provided. If the deposit is held in a different currency from the account provided, we will process a currency exchange at the applicable FX rate at the time of the refund. Please ensure to provide a bank account in the same currency as the deposit.
Please also see About EOR Deposit Refunds for more details and frequently asked questions.
FAQs
[ACCORDION]What happens if the client makes more than one change affecting the deposit?
Normally, if clients make more than one change, such as removing probation and increasing PTO, the maximum deposit will always be no more than 2 months.
However, the are exceptions for Incentive Plans, Variable Compensation, or if the notice period is increased.
[ACCORDION]How can clients use the deposit to settle a final invoice?
Clients will only be able to use their deposit to settle the final invoice if the amount of the deposit exceeds the final invoice total.
✅ Step 1 - Select the People Tab from the home page and click on the EOR who is leaving
✅ Step 2 - Click Start Settlement
From there, clients will be able to see the pending invoices and the available deposit balance. If there are no refund methods, clients will be able to add one.
✅ Step 3 - Review and confirm
Clients will be able to check the status of the payments via the Payments tab.