LogoLogo
  • Home
  • HR and Employer Hub
  • Employee and Member Hub
  • What's new in Multiplier
  • Home
  • Account management
    • Create a Multiplier account as an Employer
    • Roles and permissions of admins
      • Super Admin - Role and permissions
      • Payroll Admin - Roles and permissions
      • Billing Admin - Roles and permissions
      • HR Admin - Roles and permissions
    • Assign, edit, or remove admin roles for your employees
    • Organization departments
      • Create departments for your organization on Multiplier
      • Add employees to a department in your organization
      • Move employees from one department to another
      • Edit or delete a department from your organization
    • Set up Okta SSO on your Multiplier account
  • Employer of record (EOR)
    • EOR Onboarding
      • Onboard an EOR Employee on Multiplier
    • Severance Payment accrual for EOR employees
    • Manage employee timesheet
      • Approve or request changes to an employee's timesheet
    • View your employees' payslips
  • Contractor Solutions
    • Contractor onboarding
      • Onboard a Contractor on Multiplier
      • Onboard contractors in bulk on Multiplier
  • Manage contractor timesheet
    • Approve or request changes to a contractor’s timesheet
  • Manage contractor invoices
    • Enable automatic invoices for contractors
    • Approve or reject contractor invoices
    • Upload contractor invoices in bulk on Multiplier
    • Raise invoices from approved timesheets for pay-as-you-go contractors
    • Approve timesheets and raise invoices for pay-as-you-go contractors
  • Manage contractor payments
    • Set up ACH Auto Debit for contractors
    • FAQs - Contractor payments
  • Contractor payment reports
    • Access contractor payment reports as an admin
  • Agent of record (AOR)
    • Onboard a contractor on Multiplier via AOR
    • Onboard AOR contractors in bulk on Multiplier
    • FAQs - Agent of Record (AOR)
  • Immigration support
    • Visa support
      • Initiate visa process during onboarding
      • FAQs - Visa
  • Global payroll
    • Multiplier's Global payroll offering
    • Fund your payroll via Multiplier
    • Onboarding
      • Onboard a global payroll employee on Multiplier
    • Payroll cut-off dates at Multiplier
    • Reports
      • Global payroll reports available on Multiplier
    • FAQs - Global Payroll
    • Publish payslips
      • Approve payroll reports and publish payslips for employees
  • Integration support
    • HRIS Integration
      • Integrate BambooHR with Multiplier
      • Integrate HiBob with Multiplier
      • Integrate Zoho People with Multiplier
      • Multiplier’s integration with Workday Via API
      • Integrate Personio with Multiplier
  • Offboarding
    • Offboard an employee or contractor who resigned
    • Offboard an employee or contractor who is terminated
    • Reschedule offboarding
    • Cancel offboarding
    • Countries eligible for member-initiated resignation
  • IT Asset Support
    • Check IT asset availability by country
    • Equip employees with IT assets
    • Request IT assets while onboarding
  • Employee benefit
    • Multiplier’s Insurance premium calculation
    • Insurance FAQs for HRs and Employers
    • Set up country-specific employee benefits with Multiplier
  • Payment
    • Pay your employees and contractors
    • Supported Payment methods on Multiplier
    • ACH Direct Debit
      • Set up ACH Direct Debit
      • FAQs - ACH direct debit setup and payments
      • ACH Direct Debit payment workflow
      • Disable ACH Direct Debit
    • SEPA Direct Debit
      • SEPA supported countries
    • Multiplier’s payment process for contractors
    • Processing fees on bank transfers
    • FAQs - Multiplier's invoicing process
    • 13th and 14th Month Pay
    • Revise salaries
      • Revise salaries of employees
      • Add or revise only the additional pay for an employee
    • Withdrawal methods available for your workforce
    • Payroll
      • View payroll input details for upcoming and past payroll cycle
      • FAQ - Payroll
    • Pay supplements
      • Add pay supplements for your employees
    • Additional compensation
      • Add additional compensation while onboarding an employee
      • Types of fixed allowances available on Multiplier
      • Types of variable allowances available on Multiplier
      • Billing frequency and pay schedule in additional compensation
  • Compliance
    • Wet ink signatures
    • Job codes in Italy an employer should know
LogoLogo

Policies

  • Privacy Policy

Social Channels

  • Linkedin
  • Youtube

© Copyright Multiplier 2025 — All rights reserved

On this page
  • What is Severance Accrual?
  • How Does Severance Accrual Work?
  • Benefits of Severance Accrual
  • Countries having Statutory Severance Payment Accrual for EOR Employees

Was this helpful?

Export as PDF
  1. Employer of record (EOR)

Severance Payment accrual for EOR employees

What is severance payment accrual?

Severance payments are a critical component of employee compensation in many countries. These payments, often mandated by local labor laws, are provided to employees when their employment is terminated, whether due to redundancy, layoffs, or other eligible reasons. The amount typically depends on factors like the employee’s length of service and the country’s specific legal requirements.

Ensuring compliance with these regulations is not just a legal obligation but also a way to foster trust and transparency in employment practices.

What is Severance Accrual?

Severance accrual is the accumulation of money throughout an employee's agreement to pay final severance obligations. These obligations are based on the length of the employee's service.

How Does Severance Accrual Work?

Multiplier will include a Severance Accrual charge in the client's monthly invoice each month. This amount is set aside to cover the employee's statutory severance entitlement during termination.

Unlike the deposit invoice, the Severance Accrual is a separate charge in monthly invoices. By accruing this amount over time, we help clients avoid large, unexpected severance payments at termination.

What Happens to Accrued Severance Amounts?

  • Utilized to pay the employee during termination to fulfill statutory obligations.

  • In the case of employee resignations, any unused severance accrual will be refunded, ensuring transparency and fairness.

Benefits of Severance Accrual

Severance accrual helps clients avoid unexpected financial burdens. Instead of facing a large, lump-sum payment at the time of termination, severance accrual allows for small, predictable contributions to be set aside monthly. This proactive approach ensures:

  • Financial Planning: Smooth cash flow management and avoidance of surprise expenses.

  • Legal Protection: Full compliance with local labor laws, minimizing the risk of penalties or disputes.

Severance accrual safeguards both your business and your employees, providing peace of mind and financial stability.

Countries having Statutory Severance Payment Accrual for EOR Employees

Here is the list of countries where severance pay is a mandatory requirement. The accrual periods and payment amounts differ based on the specific regulations of each country.

Argentina

Egypt

Madagascar

South Africa

Australia

Estonia

Malaysia

South Korea

Bangladesh

France

Mauritius

Spain

Belarus

Greece

Mexico

Taiwan

Belgium

Honduras

Netherlands

Thailand

Bulgaria

Indonesia

Pakistan

Turkey

Canada

Ireland

Peru

Uganda

Colombia

Kazakhstan

Philippines

United Arab

Costa Rica

Kenya

Poland

Uruguay

Czech Republic

Lithuania

Rwanda

PreviousOnboard an EOR Employee on MultiplierNextManage employee timesheet

Last updated 17 days ago

Was this helpful?

Learn how companies determine .

severance payments