Austin Labor & Employment Updates ARCIE JORDAN

1. Austin Labor & Employment Updates ARCIE JORDAN

2. INTERNATIONAL EMPLOYMENT • Presents Unique Challenges • Foreign legal provisions • Foreign customs & practices • Assimilation of foreign workers in U.S. • Creation of tax presence through actions of personnel

3. Foreign legal provisions • Rendering of services abroad may create non-waivable employee rights under law of foreign country, irrespective of terms of employment agreement or expatriate assignment, for example: • Severance payments • Profit sharing

4. Foreign legal provisions • Rendering of services abroad may create liability for employee-related tax contributions and other government obligations under law of foreign country, for example: • Host country payroll tax • Host country social security contributions

5. Foreign legal provisions • Immigration laws limit activities of expatriate workers • Unauthorized activities may be voidable or unenforceable under foreign law; for example: • Participation in Board Meetings • Absence of proper immigration permit creates liability for worker and host company

6. Foreign legal provisions • May impede enforcement of non-compete agreements • May need to look for other ways to achieve goals (e.g., confidentiality & non-disclosure agreements) • Inbound foreign workers may have rights under foreign legal provisions when providing services in the U.S., for ex: employer-provided housing or subsidized transportation

7. Foreign customs & practices • Host country practices may be difficult to accept in light of U.S. laws, for example: • Protection or “white” unions • Negotiations with “red” or “democratic” unions • Recruitment & interviewing practices • Worker termination practices

8. Assimilation of foreign workers in U.S. • Foreign practices may require greater amount of training and education than anticipated, for example: • Sexual harrassment • FCPA compliance • Use of Ombudsmen & grievance procedures

9. Creation of tax presence through actions of personnel • Conduct of certain activities by workers or representatives may create income tax liability for expatriates abroad, as well as for U.S. company • Concept applies in the U.S. for foreign company workers & representatives too • Tax treaty provisions, as well as domestic laws should be examined • Tax liability may exist for individual worker/rep too