General Overview Materials

Global Employment Law Publications For Download……………………………..2

Be Global – November 2014………………………………………….…..………..5

Top Labor And Employment Law Issues When Taking Your Start-UpGlobal……………………………………………………………………………..15

Top 10 Pitfalls In Managing Employment Contracts As You GoGlobal………………………………………………………….……………….…19

With Record-Breaking Dodd-Frank Award, SEC Invites The World To Blow TheWhistle…………………………………………………………………………….23

Trends In The Language Of Global EmploymentDocuments…………………………………………………….…………………..25

Ebola: Key Employment Legal Issues For MultinationalEmployers……………………………………………………………….………...29

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GLOBAL EMPLOYMENT LAW PUBLICATIONS FOR DOWNLOAD

Global Employment Laws of the World

Covers employment and labor law basics in 32 key jurisdictions across the Americas, Asia Pacific, Europe and the Middle East. Click here.

uKNOW

A unique web-based knowledge portal offering online access to in-country and cross-border employment and labor law information and business culture. Click here.

Global Equity Desk References

Guides designed to help multinational companies implement their equity compensation programs. Reference guides include: Stock Options; Employee Stock Purchase Rights; Restricted Stock and RSUs and Data Privacy. Click here.

Whistleblowing: an employer’s guide to global compliance

We used our local intelligence and market analysis from 10 countries to produce a report which provides a summary of the key legislative provisions regulating whistleblowing but also examines the reasons for some of the key differences between the legal regimes. Click here.

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Restrictive Covenants

A guide that provides high level guidance, it is not a substitute for legal advice, and we encourage you to take advice in relation to specific matters. Click here.

Redundancies and Reductions in Workforce

A guide that provides high level guidance, it is not a substitute for legal advice, and we encourage you to take advice in relation to specific matters. Click here.

Data Protection Laws of the World Handbook

A handbook offering a high-level snapshot of selected aspects of data protection laws across the globe, covering over 70 jurisdictions. Click here.

Attorney Legal Privileged Handbook

In this handbook, organized by country, we point out policies that companies operating internationally should take into account when defining their internal communication policies and legal strategies. Click here.

Be Global Employment Newsletter

March 2014 – Click here. April 2014 – Click here. May 2014 – Click here. June 2014 – Click here. July 2014 – Click here. September 2014 – Click here.October 2014 – Click here.

Top 5 Labor and Employment Law Issues When Taking Your Startup Global

Reviews five critical issues for growing employers to consider before going global. Click here.

Top 10 Pitfalls in Managing Employment Contracts as You Go Global

Discussion of 10 important pitfalls to be aware of as you develop your global employment documentation. Click here.

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14 Global Workplace Trends for 2014

High level overview of the the top 14 trends impacting multinational employers in 2014. Click here.

Top Employment Issues in the Middle East in 2014 and Beyond

The Middle East, with its booming and increasingly diversified economy and rapid population growth, is a popular region for expansion by many foreign multinational companies. Click here.

Global Expansion Checklist

Highlights issues, including corporate set-up and governance, regulatory, tax, commercial and compliance, employment, global equity, data privacy and intellectual property and technology, for companies to consider when expanding. Click here.

The Labor Dish

Highlights legal issues important to US employers. Click here.

Trends in the Language of Global Employment Documents

In an interesting decision, the German Federal Labor Court recently held that a non-German speaking employee may still be bound by the terms and conditions of a German-only employment contract. To find out more, click here.

21 November 2014

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Be Global is DLA Piper's snapshot of key global employment law developments designed to help you identify legal hotspots across your global operations and assess the impact on your employment practices and procedures.

CONTENTS

HIGHLIGHTS

o UK: Potential for significant increase in cost of holiday pay o Ebola: Key employment issues for multinational employers o Trends in the language of global employment documents ® Brazil: Franchisor not liable for franchisee's labour obligations

ASIA PACIFIC

• Australia: Fair Work Commission first six months of anti-bullying cases ® Australia: Employee communications to the media not industrial action

Australia: Sexual harassment case leads to AUD 700,000 damages award • China: New minimum wage rates for Jiangsu and Hubei Provinces ® Hong Kong: Reform of privity of contract: Contracts (Rights of Third Parties) Bill

Hong Kong: Discrimination Law Review

EUROPE, MIDDLE EAST, AFRICA

Belgium: "Bring your own device" and benefits in kind • France: Caution when giving notice of termination at the end of a trial period • France: Final unemployment certificate must be delivered to the employee no later

than on the termination date e France: Moral harassment - gross misconduct dismissal may not always be required e Italy: Proposed labour law reforms for 2015 ® Romania: New immigration laws in force 28 November 2014 • Saudi Arabia: Increased minimum wage proposed for Saudi nationals working in the

private sector ® Qatar: Labour law reforms expected by end of 2014

UK: Potential for significant increase in cost of holiday pay UK: New parental leave regime

AMERICAS

• Brazil: Franchisor not liable for franchisee's labour obligations • Brazil: Reduction in limitation period for claims against severance pay funds • US: Game changer — the proposed joint employer standard • US: Employment implications of alter-ego company relationships • US: SEC decides on extra-territorial reach of whistleblower bounty provisions

HIGHLIGHTS

UK: Potential for significant increase in cost of holiday pay

The UK Employment Appeal Tribunal recently handed down judgment in the closely watched appeals in a number of cases concerning the calculation of holiday pay. The Court's decision will lead to higher wage bills for many employers in the future, but the judgment significantly limits the potential for back pay liability. Many elements of pay which are currently excluded from holiday pay must be included in future, but most claims for back pay will be limited to the last holiday year. Kate Hodgkiss, a partner in Edinburgh, provides further information on the current position in the UK. Click here to read more.

While the position in the UK is far from settled, and further developments are expected, employers need to be aware that this is not just a UK issue; it is possible that the effect of recent developments could impact on employers operating in other EU countries, to the extent that current law and practice does not require all elements of "normal remuneration" to be included in the calculation of holiday pay. As reported in Octobers Be Global, we have recently seen an example of this when the National Court in Spain ruled that certain shift allowances and premiums must be taken into account when calculating holiday pay, regardless of any provisions to the contrary in the relevant collective bargaining agreement provisions. We expect further, similar litigation to follow. For more information on the position across Europe, please speak to your usual DLA Piper contact, or email Judith Harris, International Practice Development Lawyer.

Ebola: Key employment issues for multinational employers

Employers the world over are looking to put in place plans to prepare in the unlikely event that an employee becomes exposed to or ill with the Ebola virus. Is your business prepared? Click here to view our Be Global Ebola special edition for multinational employers and click here to see our alert on six questions US employers should be asking about Ebola.

Trends in the language of global employment documents

Recent cases decided in the European Court of Justice, the German Federal Labour Court and in the Belgian Labour Courts hint that, across Europe, a greater degree of flexibility may be developing toward the use of language in employment documents. In an article recently published on Law360, Kai Bodenstedt from Hamburg, Ute Krudewagen from Silicon Valley and Victoria Richter from Chicago consider what global employers operating in multiple jurisdictions should do to manage their employment documentation effectively. Click here to read more.

Brazil: Franchisor not liable for franchisee's labour obligations

The Brazilian Superior Labour Court recently decided that a franchisor is not liable for the labour obligations owed by a franchisee to its employees. In the case in question, the judges established that the liability of a franchisor is different to that of the incoming service provider in an outsourcing situation. Priscila da Rocha Lago, Partner, and Thiago Ramos Barbosa, Associate, who have recently joined the Employment Team at Campos Mello Advogados in cooperation with DLA Piper, explain further. Click here to read more.

ASIA PACIFIC

Australia: Fair Work Commission - first six months of anti-bullying cases

The number of bullying cases brought to the Fair Work Commission during the first six months of the anti-bullying jurisdiction's operation has been released. The Fair Work Commission's 2013-2014 Report shows that the Commission received around 3,500 thousand telephone inquiries in relation to bullying, processed 343 applications and conducted 270 conferences and hearings. Of these applications, 21 proceeded to a hearing, with the rest withdrawn or resolved. The Commission stated that it was still too early in the life of the jurisdiction to be certain what its future workload under the anti-bullying laws would be. The figures suggest that there is a relatively high level of awareness among employees about the anti-bullying laws, given the number of telephone inquiries received.

In the latest decision in the anti-bullying jurisdiction, the Commission refused to make any orders on the basis that the behaviour of which the employee complained (including a performance management regime) was not bullying but an exercise of the employer's management prerogative.

Australia: Employee communications to the media not industrial action

The Federal Court of Australia has held that employees who go to the media with their employer's information are not engaging in any form of "protected" industrial action. The issue arose in the context of a protracted enterprise bargaining dispute in which ambulance service employees had voted in favour of taking industrial action, including releasing to the media the response times of ambulances. The Court's refusal to regard media communications as a form of industrial action means that employees who release their employer's information without authority may be exposed to other legal actions, including breach of contract claims and coercion under the Fair Work Act.

Australia: Sexual harassment case leads to AUD 700,000 damages award

An employee has been awarded more than AUD 700,000 in damages for systematic sexual harassment, intimidation and bullying in the workplace. The New South Wales District Court held that the employer had failed to provide a safe place of work and had exposed the employee to continuing harassment, bullying and intimidation. This is a high award of damages in the Australian context and reflects the Courts finding that the employee had suffered a serious psychiatric injury as a result of the conduct, which included persistent physical contact.

China: New minimum wage rates for Jiangsu and Hubei Provinces

The minimum wage rate increases that have been recently announced for Jiangsu and Hubei Provinces (see below) continue the trend of wage inflation in China. Despite the increases in these two provinces, Shanghai Province continues to have the highest minimum wage at RMB 1820 per month. We expect the Shanghai rate to be reviewed in March or April 2015, and it remains to be seen whether or not the rate will change. Further developments will be reported in Be Global.

iangsu Province (from 1 November 2014)

The following minimum wage (per month) applies to these cities:

Suzhou, Changshu, Kunshan RMB 1680 Nanjing RMB 1630

3 levels of minimum wage apply to other cities depending on how developed the location is:

Class 1 Location - RMB 1630 Class 2 Location RMB 1460

• Class 3 Location - RMB 1270

Hebei Province (from 1 December 2014)

The following minimum wage (per month) applies to these cities: 4 levels of minimum wage apply depending on how developed the location is:

Class 1 Location - RMB 1480 Class 2 Location - RMB 1420 Class 3 Location - RMB 1310 Class 4 Location - RMB 1210

Some examples for the cities in different locations:

Class 1 - Urban district of Shijiazhuang Class 2 - Urban district of Handan Class 3 - Jizhou, Shenzhou Class 4 - Zanhuang county, Shun ping county

Hong Kong: Reform of privity of contract: Contracts (Rights of Third Parties) Bill

The Contracts (Rights of Third Parties) Bill has been introduced into the Legislative Council in Hong Kong. If passed, Hong Kong will join other common law jurisdictions such as the UK in reforming the old common law principle of 'privity of contract. Under the current law in Hong Kong, only the parties to a contract have the right to enforce the contract terms. Subject to certain exceptions, the Bill will give a third party the right to enforce (i) a term of the contract of employment against an employer (but importantly not an employee) and (ii) a term of an employment-related contract against a party to that contract. In order for this right to be conferred on a third party, the contract must either expressly provide for the right or the contract term must seek to confer a benefit on the third party. Under the Bill it is possible to contract out of the new law (i.e., agree that the new law is not applicable to the contract and a third party will not be able to rely on the new law and enforce the terms). Employers should, therefore, start reviewing their standard contracts, employee handbooks and other employment related documentation and consider inserting clauses to either maximise the enforceability of an agreement by a third party where this is preferred or expressly exclude the law where it is not.

Hong Kong: Discrimination Law Review

The Hong Kong Equal Opportunities Commission has launched its first comprehensive review of the four anti-discrimination ordinances relating to sex, disability, family status and race. As a first step, it has sought opinions from the public on its proposed extension of protection from discrimination and the public consultation concluded at the end of October. It is expected that a report with recommendations will be submitted by the EOC to the Hong Kong government around the middle of 2015. The key proposed amendments include:

unmarried couples should be protected from family status and marital status discrimination; the Race Discrimination Ordinance should extend its protection to cover discrimination on the grounds of nationality, citizenship and residency status; a duty to provide reasonable accommodation for persons with disabilities should be imposed (currently the concept of "reasonable accommodation" is just one of the relevant factors in determining whether the defence of "unjustifiable hardship" to disability discrimination is established); the law should provide protection for sexual harassment in common workplaces where there is no employer/employee relationship, for example, an unlawful act of a non-employee on an employee at common workplaces; there should be a defence for principals to liability from unlawful conduct of agents (the defence of taking reasonably practicable steps to prevent unlawful discrimination from happening currently only applies to employers); and requests for information for a discriminatory purpose relating to sex, family status, race, marital status, etc should become unlawful (currently it is only requests for information for a discriminatory purpose in relation to disability which are prohibited).

Employers should keep track of the review as it progresses as the proposed amendments could have a significant impact on workplace policies and procedures.

EUROPE, MIDDLE EAST, AFRICA

Belgium: "Bring your own device" and benefits in kind

The National Social Security Office has recently added two allowances to its list of accepted lump sum cost allowances. As a consequence, an employer can grant any worker who uses their own PC (including hardware, software and accessories) and their own internet connection (including the subscription cost) for professional purposes, in a substantial and regular manner, a lump sum cost allowance of EUR 20 per month for the PC, and a lump sum cost allowance of EUR 20 per month for the internet connection. However, even if the National Social Security Office allows payment of these lump sums for the reimbursement of professional costs, the employer remains obliged to prove that the costs are actually incurred by the employee.

France: Caution when giving notice of termination at the end of a trial period

If an employer wishes to terminate an individual's employment contract during a trial period, a period of notice must be given. In a recent case, the French Supreme Court ruled that an employee's trial period cannot be extended by the notice period. As such, when an employee continues to work after the end of the trial period, during the notice period, a new indefinite-term employment contract will be deemed to have been agreed, which entitles the employee to benefit from the dismissal process. In view of this development, to avoid having to engage in a detailed dismissal process, employers should take steps to ensure that employment contracts are terminated at the end of the trial period at the latest. Another option for employers who are late in notifying the end of an unsuccessful trial will be to pay an indemnity in lieu of notice to compensate the employee for loss of salary during the unexpired notice period.

France: Final unemployment certificate must be delivered to the employee no later than on the termination date

The French Supreme Court confirmed recently that if an employer delivers the final unemployment certificate to an employee later than the date on which the employment contract terminates, the employee may automatically claim payment of damages by the employer. In this case, the employer modified the certificate several times before delivering the final version to the employee eight days after the end of the employment contract. The French Supreme Court decided that, in such circumstances and even if the employee did not prove any prejudice suffered because of the delay, the employer should nonetheless be

required to pay damages as the Court took the view that the employee automatically suffered prejudice. Consequently, employers should be sure to provide the final certificate by no later than the termination date.

France: Moral harassment - gross misconduct dismissal may not always be required

In a recent case, the French Supreme Court decided for the first time that an employer which had found one of its employees guilty of moral harassment in the workplace did not have to automatically terminate the employment contract of the perpetrator of the harassment for gross misconduct (without notice) to prevent prejudice to other employees. "Moral harassment" can encompass different types of behaviours but typically involves psychological harassment. The Court indicated that dismissal, with notice, for real and serious cause may be sufficient, as long as the harassment was punished and preventative measures taken by the employer. The categorisation of the dismissal will depend on the circumstances of the case and, notably, on the seriousness of the misconduct committed by the employee. Dismissal for gross misconduct may still be possible if justified in the particular circumstances.

This decision seems to demonstrate that the French Supreme Court is prepared to exercise some flexibility in relation to the categorisation of a dismissal for moral harassment. However, further decisions are required to clarify the scope of the measures (such as suspension or management training) that would be judged sufficient to prevent harassment bearing in mind that an employer may be ordered to pay damages for not having complied with its obligation to take such measures.

Italy: Proposed labour law reforms for 2015

The Government recently approved a draft of the Budget Law for 2015 which contains several important new labour measures. The draft law will be considered by Parliament over the coming weeks before it gains final approval. The most relevant proposed measures are:

A reduction in the Regional Tax on Productive Activities (IRAP) by allowing employers to deduct employment costs; Social contribution exemptions for new hires for a maximum period of 36 months and up to a maximum amount of EUR 8,060 per year per employee. To access this benefit, the employment contract must be entered into in the period between 1 January and 31 December 2015. The exemption will not apply to employees that have been working under an indefinite employment contract (with any employer) in the previous 6 months and who were employed by the same company or group under a fixed-term contract in the previous 3 months. Introduction of an option for employees to choose to have their end-of-service allowance paid on a yearly basis instead of as a lump sum at termination. Such "extra" yearly payments would be financed by banks through suitable arrangements with employers. The establishment of a public fund of EUR 2 million to alleviate the financial burden due to the implementation of the "Jobs Act" labour law reform which it is expected will, in the near future, (among other measures) reform the welfare system and introduce open-ended employment contracts with "increased protection" (such as compensation for unfair dismissal proportionate to length of service).

Note that the above measures are not yet in force as the final version of the law is still to be approved by the Italian Parliament.

Romania: New immigration laws in force 28 November 2014

On 28 November 2014, new immigration laws will come into force, amending the previous legislation in this area. The key changes are the introduction of several stricter requirements for obtaining an 'employment approval' document recording a foreign

national's right to work in Romania; the introduction of a much shorter deadline for a company benefiting from a secondment arrangement to notify the relevant territorial labour inspectorate of the secondment; the introduction of a requirement that travel documents supporting a visa application have to have been issued within the past 10 years; and the introduction of the potential to obtain a short extension to a residency permit in several circumstances, including when unemployment benefits apply. Click here to read more.

Saudi Arabia: Increased minimum wage proposed for Saudi nationals working in the private sector

Saudi Arabia is considering proposals to increase the minimum wage for both Saudi nationals and expats in the private sector. The proposals (if implemented) have suggested increasing the minimum wage for Saudi nationals from SAR 3,000 (USD 800) to SAR 5,300 (USD 1,412) per month while the minimum wage for expatriates would only be SAR 2,500 (USD 666.26) per month. The measures purportedly aim to combat the perceived inequality in the salaries of Saudi nationals working in the private sector (as compared to the nationals of other GCC countries) and more importantly encourage Saudis to enter the private sector as part of the on-going Saudization process.

Qatar: Labour law reforms expected by end of 2014

Following extensive commentary in recent months regarding the significant numbers of migrant workers based in Qatar to assist with preparation for the World Cup in 2022, the Qatari authorities have promised to reform the kafala system (under which there are stringent exit provisions in place and workers are required to obtain their employer's permission both in order to change jobs and before leaving the country). They also have promised to do more to strengthen the rights of the migrant workforce in Qatar. This month the Qatari Minister for Labour and Social Affairs has announced a number of reforms expected to be in force in Qatar by the end of 2014. As part of the proposed measures, the Qatari government will look to ban outdoor work between 11.30 am and 3:00 pm during the hot summer months from mid-June until the end of August. The proposed new labour laws are also expected to limit the length of expatriate workers' contracts to five years instead of tying workers to one particular employer indefinitely. Further, using a system similar to the Wage Protection System (WPS) in the UAE, companies will be required to pay an employee's wages directly into their bank account. Such payment will be required to be made through the WPS within seven days of the date the payment falls due under the employee's contract of employment. Failure to pay employees properly through the WPS system could lead to sanctions being imposed on employers in Qatar. The government, however, has yet to specify what level of penalty could be expected to be imposed on those in breach. The government also intends to launch an electronic complaint system in order to further protect the rights of workers.

UK: Potential for significant increase in cost of holiday pay

The UK Employment Appeal Tribunal recently handed down judgment in the closely watched appeals in a number of cases concerning the calculation of holiday pay. The Court's decision will lead to higher wage bills for many employers in the future, but the judgment significantly limits the potential for back pay liability. Many elements of pay which are currently excluded from holiday pay must be included in future, but most claims for back pay will be limited to the last holiday year. Kate Hodgkiss, a partner in Edinburgh, provides further information on the current position in the UK. Click here to read more.

While the position in the UK is far from settled, and further developments are expected, employers need to be aware that this is not just a UK issue; it is possible that the effect of recent developments could impact on employers operating in other EU countries, to the extent that current law and practice does not require all elements of "normal remuneration" to be included in the calculation of holiday pay. As reported in October's Be Global, we have recently seen an example of this when the National Court in Spain ruled that certain shift allowances and premiums must be taken into account when calculating holiday pay,

regardless of any provisions to the contrary in the relevant collective bargaining agreement provisions. We expect further, similar litigation to follow. For more information on the position across Europe, please speak to your usual DLA Piper contact, or email Judith Harris, International Practice Development Lawyer.

UK: New parental leave regime

As reported in Septembers Be Global, sweeping reforms to the UK's parental leave regime will come into effect on 1 December 2014. Although the Government has left publication of the final Regulations, official forms and relevant guidance until very late in the day, employers with UK operations are advised to progress an implementation strategy as soon as possible. In a recent article, Clare Gregory, a Partner in Sheffield, considers the top three areas of the new regime which are most likely to cause headaches for employers. Click here to read more.

AMERICAS

Brazil: Franchisor not liable for franchisee's labour obligations

The Brazilian Superior Labour Court recently decided that a franchisor is not liable for the labour obligations owed by a franchisee to its employees. In the case in question, the judges established that the liability of a franchisor is different to that of the incoming service provider in an outsourcing situation.

In Brazil, a franchise agreement exists where (i) a franchisor assigns to a franchisee the right to use its trademark or patent; (ii) a right is granted to the franchisee to distribute exclusively or semi-exclusively the products and services of the franchisor; (iii) there is direct or indirect compensation; (iv) there is no employment relationship; and (v) in some cases, the franchisee uses either technology to implement and manage the business and/or an operational system which have been developed and are owned by the franchisor.

Given these requirements for the existence of a franchise, the judges held that a franchisee is free to organize its business as it deems suitable. Although the franchisor may guide and provide the relevant technology to a franchisee, the franchisee is able to hire its own employees and bears the risks of its business activity. As such, the franchisee remains solely liable for payment of the labour debts owed to its employees.

Brazil: Reduction in limitation period for claims against severance pay funds

In a recent and innovative decision, the Brazilian Supreme Federal Court has ruled that the period for employees to claim credits from their Unemployment Guarantee Fund (FGTS) under the statute of limitation should be reduced. Prior to this ruling, courts usually proceeded on the basis that employees could seek payment of FGTS fund credits relating to the period of 30 years before the date of filing their claim. Based on the Supreme Court's decision, however, this limitation period is reduced to 5 years.

The Supreme Federal Court also implemented a transitional rule which will apply from the decision date onwards to enable individuals to become accustomed to the new limitation period.

The required FGTS deposit corresponds to 8% of an employee's monthly compensation and has to be deposited in specific blocked bank accounts. In case of termination without cause by the employer, an additional severance penalty corresponding to 50% of all the FGTS deposits must also be paid by the company.

From a practical standpoint, as a result of this reduction in the limitation period, employees who have worked for decades will nonetheless only be able to claim in respect of the 5 years immediately preceding the date of filing their lawsuit, provided that they sue the

employer within 2 years from the termination date.

US: Game changer — the proposed joint employer standard

The U.S. National Labor Relations Board, Department of Labor and Equal Employment Opportunity Commission appear to have launched an all-out attack on businesses that use outsourcing, franchising, or sub-contracting. Employers need to follow these developments closely, because they will have far-reaching impact on business practices, business transactions and litigation. Clients should be advised to review their policies, procedures, business relationships and practice now to limit their risk. Marilyn A Pearson, a Partner in Chicago, considers this development in more detail. Click here to read more.

US: Employment implications of alter-ego company relationships

In the area of employment law, the National Labor Relations Board (NLRB) has often applied the "alter-ego" theory to hold that companies that are so substantially identical in terms of, for example, management, business purpose and customers, should properly be treated as interchangeable. This theory is not, however, the limited province of the NLRB and it is also applied under other employment statutes. Michelle Sumner, an Associate in Washington, DC explains further. Click here to read more.

US: SEC decides on extra-territorial reach of whistleblower bounty provisions

Under US laws, a whistleblower who provides original information to the Securities and Exchange Commission (SEC) regarding violations of the Securities and Exchange Act which results in sanctions exceeding USD 1 million is entitled to a monetary award of no less than 10% and not more than 30% of the monetary sanction collected in the action. The SEC has recently announced its largest-ever whistleblower award under this program: an award of over USD 30 million. What is particularly notable in this case, however, is that the whistleblower was a foreign national, living outside the US. The information provided related to an ongoing fraud that the SEC would have, otherwise, found very difficult to detect. In its decision, the SEC has made clear that it will apply the bounty provisions extraterritorially. The SEC's office has said, "This award of more than USD 30 million shows the international breadth of our whistleblower program as we effectively utilize valuable tips from anyone, anywhere to bring wrongdoers to justice. Whistleblowers from all over the world should feel similarly incentivized to come forward with credible information about potential violations of the U.S. securities laws." It is expected that this decision will result in even more international leads, and resulting awards, in the future. This makes it more important than ever for companies to have in place stringent compliance programs as well as robust internal whistleblowing processes.

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Top Labor and Employment Law Issues When

Taking your Start-Up Global By Megan Muir on October 17, 2013

Our colleague Ute Krudewag en has put together a list of some key labor and employment issues to consider if and when you decide to take your US-based emerging company to overseas locations.

So you are ready to expand?

Your start-up is off the ground and running, U.S. offer letters and confidentiality agreements have been signed and compliance policies have been implemented. It's now time to hire your first employee outside the U. S. This seemingly easy task is often easier said than done. For many emerging companies, the road to a global workforce is paved with potholes. How can you prepare for the Friday afternoon call from a frantic HR manager who wants to hire a salesperson who will go to a competitor if he doesn't have an offer in his hands by Monday morning? Can you afford to lose the candidate, and all the great opportunity that the candidate represents to the business? How do you respond when asked about a sales representative who received an offer three months ago and has since then been working in Brazil, while being paid directly from the U.S.? These issues are part of running an international business, however, with the right preparation and planning, these speed bumps can be leveled before they escalate.

The five issues Ute discusses for growing employers to consider before going global are:

• Doing Business and Tax Considerations, Including Corporate Structure • Will you Expand by Hiring Employees, Independent Contractors, Third Party Agencies or Expatriate Employees? • Payroll & Benefits Processes and Costs, Including Witholding on Taxes and Social Charges (similar to Social Security) • Employment Agreements & Policies • Managing the Exit Strategy Probationary Periods, Lack of At-Will Employment, Notice Periods and Severance

Issue 1: Employment, Doing Business and Tax Considerations. The discussion about how to properly set-up your business in a foreign jurisdiction starts with corporate and tax considerations. Many countries have

`doing business' laws that require a company that is engaged in business in the jurisdiction to obtain a business license and/or formally set up a corporate presence (such as a subsidiary, branch of representative office) in that country. Similarly, there is a risk that engaging permanent employees may translate to the creation of a permanent establishment or a taxable presence in the jurisdiction in which the company engaged the employee, with the attendant tax consequences. Engaging individuals in sales roles typically creates a higher risk in that regard than engaging non-sales individuals, both because salespeople may actually create revenue in the jurisdiction at issue, and because they may have authority to make binding sales offers on behalf of a foreign entity.

Even if you can overcome any concerns about doing business or tax exposure (or are willing to run the risk after determining that the presenCe in the jurisdiction is very limited), some foreign jurisdictions still require a local corporate presence before employees can be hired. For instance, Brazil, China and Russia all require a corporate presence as a prerequisite to enrolling an employee in their mandatory social security systems.

All that said, as you explore business opportunities in a new jurisdiction, it is not uncommon to "skip" the legal entity set-up, and work on an interim arrangement to get somebody "on the ground" quickly. Some companies set -up a holding company under their ultimate U.S. parent to at least serve as a "buffer" to some of the liability. While not ideal, as long as it is carefully monitored, such types of interim solutions are a fairly common way to enter a new market. The threshold issue is how to classify your first hire.

Issue 2: Type of Hire. Like in the U.S., it is important to determine how to classify the individual and the engagement. Getting this right from the outset is crucial, or employment liabilities can be significant.

Employees. Like the U.S., most foreign jurisdictions define an employee as an individual working under the direction and control of the employer, in exchange for compensation. If you are a start-up, be very cautious when engaging individuals without compensation, or for equity only, since many jurisdictions have minimum wage and overtime requirements. That said, as mentioned above, not every jurisdiction requires a local entity to be set up to lawfully engage en employee. Most of Europe, for instance, permits a foreign company to engage a local hire through a foreign company. In that scenario, all you need to do is to obtain a payroll ID and set-up payroll, and then comply with all applicable labor and employment laws, thereby avoiding the hassle of setting up a corporate presence before you can lawfully bring an employee on board.

Independent Contractors. Misclassification is one of the few topics in global labor and employment law that is handled consistently around the globe. If an individual were misclassified in the U.S., that individual is likely misclassified globally as well. What looks and quacks like a duck is a duck. In most jurisdictions, the factor of direction and control is most important, so if there is a need to direct and control an individual, integrate her into the organization, and provide regular supervision, then she is unlikely to qualify as an independent contractor. Like in the U. S., liabilities for misclassification internationally can be significant, including liabilities for failure to withhold taxes and social charges and liabilities for failure to grant employment rights, as well as criminal liabilities in a few jurisdictions. If the individual were engaged in sales, be aware of local sales agent rules, which apply all throughout Europe under the Commercial Agents Directive, and in much of Latin America under local sales agent laws, and may impose termination notice and indemnification rights to such individuals

Third Party Agency / PEO Employees. If an individual were misclassified, engagement through an agency or professional employer organization can provide some relief, since that agency may be properly compensating that individual. Such an engagement is not without pitfalls globally, though, since many foreign jurisdictions impose

limitations and requirements on the engagement of employees through agencies. For example, under the EU Directive applicable to temporary agency workers, agency workers are entitled to equal pay rights. Other jurisdictions impose limitations on the time period for which agency workers can be engaged, or what types of roles can be filled with agency employees.

Expatriate Employees. Seconding an individual from the U.S. appears to be an easy solution, but often creates pitfalls as well. For instance, a business visa may not be appropriate if the individual is going to work in the foreign jurisdiction full-time, and without a local sponsor, a work permit is usually hard to get. Most tax treaties require payment of local taxes after 183 days or more in the foreign jurisdiction. In those cases, both the employee and the employer may be subject to local withholding liabilities. Also, most jurisdictions will deem that local labor and employment laws apply to foreign individuals regularly performing services (there is no bright-line rule as to what that "regularly" means, but it could be as little as 1 day or as much as 1-2 years).

Issue 3: Payroll & Benefits. In virtually all jurisdictions, there is a requirement for the employer, whether a foreign company or a locally registered corporate presence, to set up payroll in the jurisdiction at issue, and to make mandatory withholdings for applicable income taxes and social charges. This can result in significant additional employer cost, with up to 46% employer social charges in jurisdictions such as France, for instance. Costing this out early through a local payroll provider, or U.S. payroll provider with international operations, is crucial.

The good news is that additional benefits are often not mandatory or expected overseas, since the statutory social welfare systems in many countries will provide protections that are not necessarily commonplace in the U. S. That said, various jurisdictions (e.g., France, Italy, Spain, Brazil, just to name a few) have mandatory industry-wide collective bargaining agreements that may impose requirements to enroll employees in specific pension funds or provide yearly mandatory salary increases (in Brazil in the last few years usually around 10% or more). Thus, it is essential to be aware of country-specific nuances.

Issue 4: Employment Agreements & Policies. While short at-will offer letters are common in the U.S., the concept of at-will employment is not recognized internationally. Instead, most employees will receive a much longer formal employment agreement. Various jurisdictions (e.g., Belgium, France, Russia) require translations or the agreement will not be enforceable. Often, the agreement needs to be signed before the commencement of the employment relationship so that certain restrictive clauses (such as post-termination non-competes or probationary periods) are enforceable against the employee. Accordingly, issuing that U.S. offer letter on a Friday night may not be wise. If the situation is such that you need to send "something" to a potential hire very soon, then your best option is to make your offer clearly contingent upon execution of a proper employment agreement.

Duplicating the employee handbook that you use in the U.S. is not a good idea either. U.S. policies simply do not translate globally, and, in the worst case, give the employee the possibility to "double dip" seeking both contractual rights under U.S. kw plus local statutory rights. In most instances, there is no need for a handbook until you have grown significantly (e.g., France requires internal regulations at 20 employees, Belgium does at 1 employee, and Japan and Korea require work rules at io employees), or you can use a more limited set of policies in line with what is required or expected under local law (such as a UK disciplinary and grievance policy).

Issue c: Manage the Exit Strategy. And what if, six months down the relationship with that wonderful sales person you just had to hire, he actually turns out to be just a terrible employee? No sales made, no relationships forged, meaning it's time to part ways. And to add insult to the injury, this typically happens just a few weeks

after the probationary period has expired (if you were prudent enough to issue a proper employment agreement containing such a provision). As mentioned, the concept of at-will employment just doesn't exist outside the U.S. and (with the exception of just a handful of jurisdictions, there is nothing even close to it). Instead, all terminations require proper grounds (for instance, performance issues — which must often be excruciently carefully documented; redundancy — which often requires a look at global lack of profitability, not only a desire to restructure the role; or misconduct — which typically requires something as bad as documented bribery or proven theft from the employer). In addition, employees are typically entitled to notice, severance and some form or other of termination process. You may be left with no option other than to carefully negotiate an exit, typically with significant payouts. Releases are not enforceable in all jurisdictions either (e.g., Brazil). Lessons learned? Implement a probationary period where permissible (and track its expiration!), carefully monitor and document performance issues early on, and simply be prepared to slow down instead of overhire.

A client of mine once said that her mantra since starting to deal with international workforce issues is to take off her hat as a U.S. employment lawyer, put on her international hat, and assume that nothing she takes for granted when dealing with her workforce domestically will apply abroad. There is quite some truth to this approach. The good news is, though, that with some basic understanding of how things are different internationally, and foresight when expanding abroad, global labor and employment issues can be handled successfully.

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Top 10 Pitfalls in Managing Employment Contracts as You Go Global

By Ute Krudewagen on July 1st, 2014

The CEO of an emerging growth company called me a while ago, a bit shocked after having seen the employment contracts that had just been issued to a couple of new hires in Hong Kong. "How could they be longer than mine!? Are you sure that is the approach we should take as we expand our operations?"

•

This CEO, like many US executives, employment lawyers and HR representatives, is accustomed to one- or two-page US-style at-will offer letters. But in many jurisdictions around the world,. detailed employment agreements are not only customary and best practices, but are simply required. In fact, as foreign companies expand into the US, we see the reverse phenomenon — foreign companies rolling out foreign-style employment agreements to US-based regular employees, thus losing the benefits of the unique concept of at-will employment in the US.

Against this background, here are ten important pitfalls to be aware of as you develop your global employment documentation:

1. You don't use a contract. Outside the United States, your employees will expect a contract — and might sue if they don't get one! Written employment agreements are best practices and they can incorporate crucial terms such as probationary periods, termination grounds, or working time provisions. In fact, many jurisdictions require written employment agreements. In China, for instance, a company that fails to issue a written employment agreement within one month of the commencement date will be subject to double wage claims. In the European Union, under Directive 91/533/EEC[1], an employer is required to inform its employees of all relevant terms of the employment relationship within two months of commencement of employment; commonly,

this information is provided in the employment agreement. Several EU member states have more stringent requirements.

2. You fail to protect your company by including probationary periods and proper termination provisions. Given the lack of at-will employment, probationary periods are crucial outside the United States. Each country has different rules on the maximum duration of a probationary period, whether renewals are permissible, etc. (e.g., Germany permits a six-month probationary period, China six months for open-term contracts, but only one month for fixed-term contracts of less than one year, and two months for contracts longer than one year). If you include a probationary period, make sure to make any termination decisions before expiration of the probationary period. In various jurisdictions, termination provisions are crucial as well. While they may not always give a company full protection (since ultimately, it is statutory restrictions that determine in which instances terminations are permissible), they often give a company at least a good starting point to enforce a termination (e.g., in case of violation of company policies such as a code of conduct).

3. You don't think strategically when it comes to employment contracts. One size does not fit all. Before you embark on drafting employment agreements for your international operations, think through the strategy you want to use. The most common approach is to prepare a local-law-compliant employment agreement in line with best practices and the standard approach of the specific jurisdiction where you hire. Some companies feel strongly about global consistency, though, and would rather create a "global" template that would only be localized as necessary under local laws. One hybrid approach is to agree on company-specific clauses (such as references to specific global policies and commission plan or bonus language — keeping in mind that internationally, once granted, variable compensation is hard to take away or amend) to include in any agreement globally, while otherwise working off local templates.

Also consider the interrelationship between your contract and policies. In some jurisdictions, it is advisable to incorporate relevant handbook policies in the contract (e.g., in the UK you need to mention disciplinary and grievance procedures). Having policies incorporated (e.g., data protection) can also often protect the company if claims are brought to show the employee was aware of procedures. Finally, do not forget data privacy considerations. Consider, for instance, whether you need consent to the transfer of personal data in the employment agreement, or a standalone data privacy notice.

4. You don't properly address assignment of intellectual property.[2] Keeping your intellectual property safe starts from day one. Have you considered how to address IP assignment? If there is a standard proprietary information and inventions assignment agreement (PHA) you want to use, this must be localized under local laws. Sometimes, specific policies and procedures are required. In China, for instance, absent company rules on payments made for employee-created patents, a company will end up paying an amount determined under statutory rules. In Russia, trade secrets must be specifically outlined in a company trade secrets regime or those trade secrets will not enjoy protection.

5. You use the wrong employing entity. Make sure your employees (and the government and courts) know who's the boss. A common mistake is to print the employment agreement on the parent company's letterhead, or to include the parent company as employer of record in the contract. This is only accurate where that company in fact acts as the employing entity (which is not feasible in some jurisdictions, like Brazil, Mexico or Russia). Where you have set up an international structure of local subsidiaries, these should be expressly indicated to be the employing entity, or you risk joint employer liability and permanent establishment exposure of the employing

entity, thus obliterating all the tax planning the company has done. One exception to this rule: if stock option grants are made in a parent company, that company should be issuing the stock award documentation.

6. You use the wrong template. Which template to use is not determined by the employing entity, but by the jurisdiction in which the employee performs his or her services. While most jurisdiction recognize the principle of choice of applicable law, this is usually overridden by considerations of public policy, and employees are almost always deemed protected (for example, see Article 8 of the Rome Convention[3]). Accordingly, an employee in France should receive a French law-governed employment agreement, even if the employee works for a UK employing entity. Otherwise, the employee could enjoy the best of both worlds (in this example, UK contractual rules, plus French statutory rules).

Also, templates for specific individuals or situations should be used where appropriate, such as fixed-term employment agreements (where permissible), managing director or entrustment agreements (e.g., in Germany or Japan for certain individuals in corporate roles), or agreements with specific working time provisions depending upon level of the employee.[4]

7. You fail to translate your contract. No surprise, but employees should be able to understand their agreement or it will not be enforced against them. It is always fascinating when employees who used to be fluent in English during their entire employment relationship seem to have lost their ability to communicate in that language when it comes to bringing a termination lawsuit. Indeed, many jurisdictions (such as Belgium, France or Poland) require employment agreements to be in the local language, even for an employee fluent in a foreign language. Absent that, the agreement will not be enforceable (at least not against the employee).

8. You insert unenforceable non-compete provisions. You may think US state-to-state rules are confusing, but it gets much more interesting abroad. Rules on post-termination restrictive covenants vary significantly from jurisdiction to jurisdiction, with many following a general reasonableness approach (as in Australia, the United Arab Emirates or the UK), others prohibiting them outright (e.g., India, Mexico and Russia) and yet another set of jurisdictions requiring specific payouts for post-termination non-competes (e.g., China, France and Germany). If you include such provisions in your employment agreement or PITA, ensure that you understand the legal requirements. For instance, in Germany, once included, a post-termination non-compete can only be terminated with a one-year advance waiver, or the company will end up paying the mandatory 50 percent post-termination non-compete compensation even if it has no desire in enforcing the provision.

9. You don't issue your contract on time. Often, some delay is not a big deal, but there are jurisdictions (most often in the common law context) in which a valid contract is predicated not only on offer and acceptance, but also payment of a consideration, and these actions must happen within the proper timeframe. For example, if an employee in Canada receives his or her employment agreement after having commenced employment, then that employee will not be technically bound by the agreement, since no additional consideration was provided for the contractual restrictions set out in the contract. Ongoing employment is not sufficient.

10. You let your contracts become stale. Last but not least, keep in mind that laws change, as do your company's practices. Implement a process to regularly review your template agreements and make sure they still provide you the best protection possible.

[1] See it here.

[2] See this post on the blog International Employment Lawyer.

[3] See this page.

[4] See this post on International Employment Lawyer.

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DLA PIPER

With record-breaking Dodd-Frank award, SEC invites the world to blow the whistle

Securities Litigation Alert (US) 2 OCT 2014

By: Perrie Michael Weiner I Patrick Hunnius

The SEC has announced its largest-ever Dodd-Frank whistleblower award: between $30 and $35 million. While the amount of the award is

eye-popping on its own, the Commission's order awarding the whistleblower's claim — the fourth award to an individual living outside the US -

may be the SEC's most emphatic statement to date regarding its power to apply Dodd-Frank's whistleblower provisions extraterritorially. Moreover,

the award may presage continued growth in the number of whistleblower submissions from outside the US.

In August, the Second Circuit held that the "antiretaliation" provisions of Dodd-Frank (as opposed to the whistleblower "bounty" provisions) do

not apply extraterritorially. As part of his (unsuccessful) argument that the antiretaliation provisions should apply extraterritorially, the plaintiff had

argued that the SEC's interpretation of Dodd-Frank's whistleblower bounty provisions strongly suggested that the SEC "conceives of the bounty as

having international reach."

The Second Circuit assumed, without deciding, that the plaintiff's interpretation of the SEC's thinking was correct, but greeted it with great

skepticism: "Given the strong presumption that statutes are limited to domestic application in the absence of clear expression of congressional intent

to the contrary, it is far from clear that an agency's assertion that a statute has extraterritorial effect...should be given deference."

In last week's Order, the SEC acknowledged the Second Circuit's decision, but stated it did "not find [the Second Circuit's decision] controlling

here; the whistleblower award provisions have a different Congressional focus than the anti-retaliation provisions, which are generally focused on

preventing retaliatory employment actions and protecting the employment relationship."

Furthermore, the SEC made clear that it will apply the bounty provision extraterritorially:

In our view, there is a sufficient U.S. territorial nexus whenever a claimant's information leads to the successful enforcement of a

covered action brought in the United States, concerning violations of the U.S. securities laws, by the Commission, the U.S.

regulatory agency with enforcement authority for such violations. When these key territorial connections exist, it makes no

difference whether, for example, the claimant was a foreign national, the claimant resides overseas, the information was submitted

from overseas, or the misconduct comprising the U.S. securities law violation occurred entirely overseas.

Given the size of the award, the minimal threshold set by the SEC for a foreign whistleblower to qualify for an award (i.e., original information that

leads to the enforcement of a covered action, no matter where in the world either the company, the conduct or the whistleblower is), and the

significant numbers of whistleblower complaints the SEC has previously reported it is already fielding from outside the US, the Order will likely

result in even more international leads (and resulting awards) in the future. In the words of Sean McKessy, Chief of the SEC's Office of the

www.dlapiper.com

Whistleblower, "Whistleblowers from all over the world should feel similarly incentivized to come forward with credible information about potential

violations of the U.S. securities laws."

For more information about whistleblower awards under Dodd-Frank, please contact the authors.

www.dlapiper.com

Ute Krudewagen

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Trends In The Language Of Global Employment Documents Law360, New York (November 07, 2014, 10:46 AM ET) -- In an interesting decision, the German Federal Labor Court recently held that a non- German speaking employee may still be bound by the terms and conditions of a German-only employment contract (5 AZR 252/12). The employee in question, a

Portuguese national and resident who did not speak German, signed an employment agreement drafted only in German. Even though the employee negotiated his employment terms in Portuguese, the court held the employee voluntarily signed the agreement and, as such, was in principle bound by it.

This follows the European Court of Justice decision last year that the Flemish Language Decree, which regulates the use of languages in labor relationships, violated the free movement of workers as it required that an employment contract drafted in Flanders must be in Dutch. The case involved a Dutch national employed in Flanders by a subsidiary of a Singaporean multinational. The employment contract was drafted in English. On these facts the ECJ held that the decree went beyond what is necessary to protect employees and promote use of the Dutch language.

Based on the comments of the ECJ, the Flemish legislator has since amended the decree to modify the Dutch language requirement in certain cross-border individual employment contracts. A legally valid version of an individual employment contract in certain circumstances can now be drawn up in the official language of an EU member state or the European Economic Area as long as it is a language that is understood by all contracting parties involved.

Since then, a few cases in Belgium have made rulings consistent with the ECJ decision. Recently, a Brussels labor court decided that an employer in the Flemish region of Belgium lawfully terminated an employee for competing with the company despite the fact that the employer's investigatory hearing into the misconduct was in English only. The court relied on the ECJ ruling and the fact that the employee worked in a cross-border context in Belgium, Luxembourg and the Netherlands as a senior manager.

These cases appear to show a clear direction of travel toward greater flexibility in the use of language in employment documents, but is that true? For instance, the Flemish legislator did not strike the Flemish Language Decree per se, but simply modified it so that having a legally enforceable contract in an (approved) language other than Dutch is an option in limited circumstances concerning individual cross-border employment contracts.

Dutch remains the official language to be used in labor relationships between employers and employees (there are similar rules, requiring use of French, German or Dutch, as applicable, in other regions of Belgium). Moreover, if there is a difference between the Dutch version and the version of the same contract in another language, the Dutch version prevails. There are still numerous other jurisdictions that require employment documents be drafted in the local language, and court cases where employers lost their legal argument due to issues being lost in translation. So, perhaps the direction we are traveling in is not as flexible when it comes to drafting employment documents in English as it may seem.

Even in countries considered to be English speaking it can sometimes be beneficial for employers to translate employment documents into languages other than English. In Texas, the case of Haggar Clothing v Hernandez, 164 S.W. 3d 386, 387 (2005) highlighted that translating human resources policies can help to mitigate against potentially expensive risks of misunderstandings by non-English speaking employees. Hernandez was terminated when she did not return to work after one year in line with a company leave of absence policy. She sued, alleging she had been unlawfully terminated for filing a workers' compensation claim in good faith and said that the leave of absence policy was not uniformly enforced. In overturning the $1.6 million jury verdict for worker compensation retaliation, the Texas Supreme Court concluded that there was not sufficient circumstantial evidence of discriminatory application of the absence policy.

One of the factors considered in the mix was that the termination was consistent with the company handbook which has been communicated in Spanish to the Spanish-speaking plaintiff. The cost of translating was therefore well worth it in this case. However, multinational companies cannot translate all cross-border communications into every relevant language. The costs and time implications just wouldn't be practical.

So, against this background, what should a global employer operating in multiple jurisdictions do?

Understand the Legal Requirements for Translation

There are only a few jurisdictions that mandate local language versions for employment documents, even for an employee fluent in a foreign language. This includes Belgium, France, Turkey, Quebec and Saudi Arabia. Some U.S. states have discrete translation requirements as well, such as California, which requires, for instance, translation of a pregnancy disability notice if more than 10 percent of the workforce has a primary language other than English (2 CCR Section 7291.16(d)(4)).

There are some opt-outs, such as Quebec, which allows individual employees to sign waivers declaring they speak English and accept English communications in certain instances. But this is the exception rather than the rule and, if an employee requests a French translation and refuses to sign the opt-out clause, the employer has to provide the translation.

In most jurisdictions with any type of language requirement, failure to comply with the translation requirements will often result in the document being null and void. Another potential pitfall for employers is that that the employee may be able to rely on the English document, but the company cannot. A typical example is a global sales commission plan where the employee can claim on-target earnings without needing to comply with the terms of the plan, as French court cases, for instance, have confirmed.

Understand the Practical Realities and Business Need for Translation

Even if there is no blanket rule requiring local language versions, often translations will be required as a practical reality. Many countries require that employers submit certain documents to government agencies and certain other documents to workers or their representatives. For instance, in Spain, a basic copy of the employment agreement needs to be submitted with the employment authorities. In light of this, a Spanish language version is a practical requirement.

In other instances, employee collective groups, such as works councils and unions, will need to be notified or consulted with about implementation of certain policies. For example, in China, a global code of conduct or other policies affecting immediate interests of employees will need to go through a "democratic process" within the workforce. In practice, even if the law is silent on language, a document drafted only in English may substantially delay the process or, even worse, may not even make it through nor be upheld by a court. Obviously, if employees are not fluent in the language the document is drafted in, it may have a hostile reception and local courts are unlikely to bind employees to such terms. There are exceptions to this though. In Scandinavia, for example, government agencies and even trade unions may sometimes accept certain English documents.

Develop a Global Strategy

Around the knowledge gained through above two items, a global employer can develop a strategy, starting with what has to be translated, what is recommended to be translated and what can be left as it is. The company can then weigh commercial risks and strike a balance by focusing on crucial documents, such as employment contracts, intellectual property and confidentiality agreements as well as policies requiring compliance and compensation documents, as opposed to ancillary documents where the company may be prepared to take some risk bearing in mind the cost and time of translation.

A company should also consider whether it will provide documents in the local language only, resulting in somewhat shorter and thus easier to administer documents, or in dual language, with the upside of employment documents that can also be read by headquarters.

If a dual language document is used, it is crucial to state which language prevails. In some countries, such as France and Turkey, local language will always prevail regardless of what is provided for in a contract. So, in those cases, ensuring translation consistency can avoid unwittingly granting employees more generous terms under a local translation than the company had intended.

Even within the English-speaking U.S., mistranslations can have unintended and negative implications as the recent case of Labriola Baking Co., 361 N.L.R.B. No.41 (9/8/14) demonstrated. Here the National Labor Relations Board concluded that a Chicago bakery interfered with an election based on inaccuracies in a Spanish translation of communications concerning a vote on union representation. Labriola asked its payroll administrator to translate the message for Spanish-speaking employees and his version contained phraseology the NLRB found to be "highly coercive". Even though the translation was prepared by a bilingual internal manager and not a professional service, the NLRB gave no leeway for imprecision.

Conclusion

Understanding these dynamics can enable multinational employers to navigate the complexities of local requirements. Ultimately companies can then take an informed decision as to whether an accurate translation is mandatory or simply makes good HR and business sense in the context of a global strategy.

—By Kai Bodenstedt, Ute Krudewagen and Victoria Richter, DLA Piper

Kai Bodenstedt is a partner in DLA Piper's Hamburg, Germany, office.

Ute Krudewagen is a partner in DLA Piper's Silicon Valley, California, office.

Victoria Richter is a senior attorney in DLA Piper's Chicago office.

The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.

All Content c 2003-2015, Portfolio Media, Inc.

03 November 2014

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EBOLA: KEY EMPLOYMENT LEGAL ISSUES FOR MULTINATIONAL EMPLOYERS

By Tim Marshall, Sarah Lawrence and Judith Harris

As the number of Ebola cases hits the 10,000 mark, employers the world over are looking to put in place plans to prepare in the unlikely event that an employee becomes exposed to or ill with the virus. Is your business prepared?

DLA Piper's global team can help advise employers, wherever they are based, on the employment legal issues involved. We are currently advising clients on a range of issues related to the Ebola outbreak and have extensive experience of advising on similar outbreaks such as SARS. Some of the key issues to consider are set out below.

HOW CAN YOU BEST PROTECT THE HEALTH AND SAFETY OF YOUR EMPLOYEES?

The World Health Organisation says that the risk of a person becoming infected with the Ebola virus during a visit to any of the affected areas is extremely low; nonetheless, employers have an obligation to ensure a safe workplace which should include taking steps to guard against the risk of infectious diseases in the workplace. An effective strategy to protect employees and to eliminate any unnecessary panic should include:

keeping abreast of government advice and communicating this to employees; updating contact details of employees and circulating emergency contact details for key employees; carrying out a risk assessment, ensuring good hygiene practices in the workplace and training employees on the key facts and risks;

• updating any policies or procedures (e.g. sickness absence, dependent care leave, flexible/home working) which may be affected by an outbreak of Ebola; displaying signs of symptoms and steps employees should take if they suspect they may have come into contact with someone with Ebola including details of the nearest medical center equipped to deal with Ebola outbreaks; and

® asking employees to report to HR if they themselves have been to a high risk destination or if they have been in contact with someone else who has been to a high risk destination regardless of whether or not they are exhibiting symptoms.

CAN YOU REQUIRE EMPLOYEES TO STAY AT HOME IF THERE IS ANY RISK THAT THEY MAY HAVE COME INTO CONTACT WITH EBOLA?

Employers may wish to require employees who have travelled to or been in close contact with someone from a high risk area to be placed on enforced leave or require them to work from home until it is clear they are not infected.

Employers should carefully review internal policies and contracts of employment to check whether there are any provisions enabling them to do this lawfully, and, if there are no such provisions (and depending on the applicable laws in the relevant jurisdiction), weigh up the risks of the "quarantined" employee bringing a claim versus their general duty of care towards all employees. An asymptomatic US nurse, who was confined to an isolation tent on returning home from treating Ebola patients in Sierra Leone, has won a court order blocking her quarantine, despite the fact that it complied with current Centers for Disease Control and Prevention guidelines in the US. The issue of quarantine is likely to remain a live and delicate one.

Any period of time for which an employee is required to remain away from the workplace should be reasonable, which in general will be no longer than the time taken to establish that the virus has not been communicated. Unless the local regime or contract provides otherwise, employees should, generally, be paid as normal, at least until such time as the situation changes and they are either declared unfit for work - so that any sick leave entitlements kick in - or are able to return. Employers should also take all necessary steps to ensure that employees are able to continue to work (if they are well enough to do so) to avoid employees suffering any prejudice as a result of being required to work from home.

CAN AN EMPLOYER CARRY OUT MEDICAL SCREENING IF AN EMPLOYEE HAS BEEN TO A HIGH RISK DESTINATION?

The right to screen employees, and/or require them to attend medical appointments, will depend on the local legal position and contractual rights, and here employers need to balance the obligation to provide a safe workplace against obligations of data privacy and confidentiality. Whether it is proportionate and reasonable to ask an employee to undergo a screening test and the potential options if the employee refuses will also depend in part on the medical advice received in the relevant jurisdiction regarding the necessary precautions, taking into account the level of potential exposure and risk. Discrimination risks could also arise if employers single out certain employees based solely on their nationality or racial or ethnic origin.

Information gathered about the health of an employee will be classed as sensitive data in some jurisdictions, requiring special handling, so employers should always take care to keep information relating to the health of employees confidential.

WHAT CAN AN EMPLOYER DO ABOUT EMPLOYEES WHO REFUSE TO COME INTO WORK OR TRAVEL?

Employers need to balance the need to keep genuinely sick employees away from the workplace and the need to prevent unauthorized absence. While employment laws vary from country to country, employers generally have a duty of care towards employees at work and on business travel - as well as to third parties visiting the employers premises - in addition to obligations under local health and safety laws. Employers worldwide are expected to take proportionate and sensible action to protect employees and third parties on their premises, and this will include cancelling business trips if government and insurance guidelines advise against travel to specific destinations. Failure to follow such advice could put your business at risk of negligence or health- and safety related claims should an employee become infected on such a trip and this could even invalidate your insurance policies.

While employers should be sympathetic towards employees who have genuine and reasonable fear that attendance at work or international travel could put them at risk, they should also be wary of employees taking advantage of the situation. Employers should ensure that their disciplinary and absence policies deal with any employees who are

unreasonably refusing to attend work or travel for work through fear of contracting the virus.

HOW CAN A MULTINATIONAL EMPLOYER DEAL WITH CONTINGENCY PLANNING ON A GLOBAL BASIS?

Ebola is an international concern and multinational employers should consider implementing advice and plans across their worldwide operations. The key issues to consider in respect of each jurisdiction will include:

• ensuring that the employer has complied with its duty of care and obligations in respect of health and safety towards employees, contractors, clients and visitors;

® reasonably balancing the rights and obligations of employers and employees; • providing employees with access to up to date information and support; * putting in place appropriate medical arrangements; ▪ personal injury liability.

For more information on managing emergency situations, read our recent article on Employee Danger Zones: An Overview of Employer's Considerations when Disaster Strikes.

CONTACT US

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