Petersen - Managing a global workforce

MANAGING A GLOBAL WORKFORCEPresented by:Grant D. Petersen, Esq.OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C.100 North Tampa Street, Suite 3600, Tampa, FL 33602(813) 221-7231 (dd)/(813) 220-7318 (c)/(813) 289-6530 (fax)Grant.petersen@ogletreedeakins.com www.ogletreedeakins.com

SALES REP BRAZIL U.S., OFFSHORE EXPAT toEMPLOYEE INC. CHINA GERMAN SUBSIDIARY

Brazil Sales Representative• Highly recommended by government customer• Signed Company’s U.S. I/C agreement• Company changed rep’s territory• Sales rep terminates contract and sues for severance• Company’s U.S. facility raided by the FBI• WHAT HAPPENED?

Brazil Sales Representative• Independent Contractor v. Employee - Presumption: individual is an employee * Entitled to all statutory employee rights * Company has tax presence in Brazil - Use staffing agencies or require rep to incorporate

Brazil Sales Representative• Tailor contract to meet commercial agent law - 90 day notice of termination for indefinite contract - Sales rep can terminate if services reduced - Sales reps entitled to an indemnity of 1/12th of total remuneration received upon termination

Brazil Sales Representative• Foreign Corrupt Practices Act: - U.S. company, individual, or foreign subsidiary; - Offering or authorizing payment of $ or anything of value; - Directly or indirectly - With a corrupt intent - To a foreign official, political party or candidate (Includes “SOEs”)• Sieman’s paid $1.6 billion in FCPA fines for failing to conduct due diligence

Brazil Sales Representative• Establish an Anti-Corruption Compliance Program - Conduct a baseline risk assessment - Assign managerial and governance responsibility - Establish corporate policies - Communicate to and train all stakeholders - Obtain certifications of compliance - Develop 3rd party and M&A due diligence checklists - Develop contract provisions for third parties - Develop a reporting mechanism - Conduct periodic compliance reviews

Offshore Business to China• Decision: offshore department to China• Most employees will be laid off – some will be transferred to other jobs• Employees informed when deal closes 30 days later• Employees provided with severance agreements with a release of claims• 1/2 of the laid off employees sue• Chinese workers sue the Company for personal injuries at work• WHAT HAPPENED?

Offshore Business to China• Comply with employment discrimination laws & OWBRA• Remember to WARN – 60 daysInvestigate Trade Adjustment Assistance• Watch out for Alien Tort Claims Act: - Aliens can bring a civil action in the U.S for a tort violating international law - No employment relationship is necessary

Expat Assignment• Female executive sent to German subsidiary• Signed U.S. employment agreement (at-will employment, expat benefits, noncompete clause)• Harassed by 20 year German, male employee• Company fires male employee• Female quits and begins work for a competitor• Female files sexual harassment charge with the EEOC• Female sues Company for vacation days• Male harasser sues the Company• WHAT HAPPENED?

Expat Assignment• Legal Issues Regarding Expatriate Agreements: - Choice of Law and Jurisdiction – Host country - Term of Agreement – no at-will - Mandatory vacation, holidays and benefits - Confidentiality and Restrictive Covenants – compensation for covenant

Expat Assignment• Three U.S. job discrimination laws follow U.S. expats: - Title VII of the Civil Rights Act - Age Discrimination in Employment Act - Americans With Disabilities Act• German employee has privacy right to flirt• The “Foreign Laws Defense” applies if: - Decision concerns an employee in a foreign workplace - Compliance with U.S. law violates foreign law

Expat Assignment• Data protection restrictions - Employee personal data is strictly regulated - German subsidiary cannot transfer H.R. data to U.S. unless: * trans-border data transfer agreement * Meets safe harbor provisions * binding corporate data privacy rules

Expat Assignment• Legal rights of male harasser - Fire “for cause” - 7 month written notice - Consultation with works council - Alternatives to termination

Global HR Policies• Implement U.S. Code of Ethics in Germany - Discrimination, harassment, etc. - Bribery, gifts, etc. - Whistleblower hotline - Discipline for violations• Implement immediately• ANY PROBLEMS?

Global HR Policies• Works Councils - Information and consultation - Co-determination – consent required• Data Protection - Hotline limited to accounting and bribery related issues - Exclusive hotline or website - Cannot encourage anonymous reporting - Trained dedicated investigators - No transfer of data outside Germany without protections

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Petersen - Managing a global workforce

by HR Florida State Council, Inc.

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