Yes, clients will provide a 401(k) retirement plan to their Employer of Record (EOR) employees.
The plan provider for Deel EOR is Fidelity, and client contributions are mandatory.
Employees are automatically enrolled in the 401k plan. After their first payroll, they will receive an email from Fidelity with additional details about the 401k plan and instructions on how to set up their account online.
What is a 401(K) plan?
A 401(k) plan is a tax-advantaged defined contribution retirement account many employers offer to their employees. It is a traditional retirement plan in the United States, where employees invest money directly from payroll into a retirement account.
What is the mandatory contribution?
The client is required to participate in a 2% matching per pay period for the 401(k) plan.
This is not optional and the client cannot opt to increase or decrease this amount.
However, the EOR employee can choose to contribute additionally to their 401k plan. Employees can stay at the initial rate of 5% contribution, or edit their contributions at any time that will begin for the following pay cycle.
The employee's contribution is optional, and an employee may contribute any amount they wish up to the annual limit.
There are annual maximum limits to the contributions from clients and employees to a 401(k) plan. These maximums change year to year, and you can contact us at any time to learn more details.
Additional fees may apply for employee accounts. Please contact us to learn more information on the 401(k) program with Fidelity.