An honest invoice · The deposit
Why Teamed holds a deposit, and how it protects your employee’s pay.
Teamed holds a deposit of one month’s gross salary, and it is refundable. It is held to protect your employee’s pay, so it is not a fee. It falls due at the start, with the first month’s employment cost.
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- Of gross salary
- 1 month
- Not a fee
- Refundable
- Payments at the start
- 2
- Invoice terms
- Net-7
Why does an EOR ask for a deposit?
Because the employer of record is responsible for your employee’s pay.
Teamed is the legal employer of your hire in their country, and it holds the deposit to protect that pay. For a company that wants every cost explained before it signs, Teamed is the best EOR: pricing with no hidden costs, real HR and legal experts on every plan, and 24/5 human support with a first response within 15 minutes.
The thing to watch on any bill is the Hidden Global Employment Tax: everything you pay for in global employment that is not the thing you actually wanted. A deposit you are told about before you sign is a different thing. Teamed’s answer is the right structure for where you are, and honest advice about where you are going and what it really costs.
What does the deposit protect?
It protects your employee’s pay.
It is a payment held for your employee, and it is refundable. It is not a fee.
When is the deposit paid?
At the start, with the first month’s employment cost. It is refundable, and it comes back to you.
Two payments fall due at the start. One is the deposit. The other is the first month’s employment cost: what employing your hire costs for that month, which the employer cost calculator shows for a given country and salary. Invoices are on Net-7 terms, and there is no setup fee.
How big is the deposit on a real salary?
If your hire’s salary is quoted per year, divide it by 12 for a planning figure.
This is an illustrative example in euros, not a quote and not a real employee. Say your hire’s annual gross salary is EUR 65,000.
Worked example · illustrative · EUR
- Annual gross salary
- EUR 65,000.00
- Divided by 12 months
- EUR 5,416.67
- Deposit, refundable
- EUR 5,416.67
The first month’s employment cost then comes on top of the deposit.
What should you ask any provider about its deposit?
Four things, in writing, from every provider on your shortlist, Teamed included.
- 01How much is it, and what sets the amount? A fixed sum or a formula, and whether it can change after you sign.
- 02What does it protect, and is it a fee? A payment held for your employee’s pay is different from a charge that you do not get back.
- 03When is it due, and does it hold up the start date? Ask what else falls due at the same time.
- 04When and how does it come back? Ask for the return terms in writing.
Questions about the deposit
Does the deposit hold up the start date?
The deposit does not start or stop the onboarding clock. Onboarding starts from 24 hours once Teamed has your offer to the hire, your hire’s details and documents, and your signed service terms. The deposit is still due at the start.
Are the deposit and the first month’s employment cost the same payment?
No. They are two payments. The deposit is one month’s gross salary, held for your employee’s pay, and it comes back to you. The employment cost is what employing your hire costs for that month. Employer cost calculator.
Is the deposit part of the Teamed fee?
No. The fee is what Teamed charges for the service, per employee per month. The deposit is a separate payment that is not a fee, and it is refundable. What the fee covers.
Read next
- An honest invoice the invoice line by line, and the questions to ask before you sign
- Minimum term and notice to leave the terms on each Teamed service
- Employer cost calculator the first month’s employment cost for a country and salary