Context
Presenting security funds and explaining the financial verification process to a prospect.
Talk Track
INTRODUCTION: SECURITY FUNDS
Security funds are there to protect you, not to add cost or complexity. They help ensure that your employment setup stays compliant and that salaries and severance obligations can always be met. Security funds consist of two components, a deposit and, in some cases, severance accrual. If your financial standing is strong, a deposit is not needed and severance accrual becomes optional. When these safeguards are required, the funds stay entirely yours and are only used for the specific purposes agreed. It gives you confidence that everything is handled properly.
DETAILED PROCESS
To make the process objective and transparent, we partner with Allianz for the financial verification. They review publicly available data and assign a score from 1 to 10. This score determines which safeguards apply.
Grades 1 to 5: no deposit, severance accrual optional
Grades 6 to 7: deposit required, severance accrual recommended
Grades 8 to 9 or limited data: mandatory deposit, severance accrual and an additional one month deposit. This extra deposit may be refunded after six months if payment history is strong
It is important to note that the financial verification process is ongoing. Allianz reassesses financial standing on an ongoing basis, and any security fund requirements are aligned to the most up to date score. This system ensures fairness, clarity and a level of protection that matches your specific situation. It also ensures salaries and statutory entitlements are safeguarded at all times.
DEPOSIT
The deposit is simple but important. It ensures salaries can always be paid throughout the notice period, even in an unexpected situation. The amount is calculated based on total employment cost and the minimum legal notice period in each country, with a minimum of one month rounded to the nearest 500 in the invoicing currency. If you choose to extend the notice period for your talent, the deposit increases to match. Some countries have longer mandatory notice periods, so deposits will naturally be higher there. The key point is that the deposit is fully refundable at the end of employment.
SEVERANCE ACCRUAL
Severance accrual is designed to protect you in countries where severance rules can create large final invoices. We set aside 6.5 percent of your talents monthly salary across the 24 relevant countries. This acts like a safety buffer so you never face an unexpected financial impact when a contract ends. We keep track of the amounts, manage the calculations and apply the correct regulations. Any unused amount is reimbursed when employment ends. It is a simple way to make sure you are always covered.