Other countries’ laws cut no iceOn 1 Nov 2001 in Personnel Today Previous Article Next Article It is essential that HR observes US employment law when sending employees towork there. Liz Simpson examines the wide-ranging differences enforced in theUS from state to state To outsiders it may appear to be one country, but in reality the UnitedStates is a confederacy of 50 states – and this is never more apparent thanwhen having to get to grips with US employment law. Three different types ofstatutes apply here. Federal law offers basic safeguards on nitty grittyemployment rights such as minimum wage rates, overtime payments and workplacesafety. State law covers more detailed issues relating to any contractualarrangements. And then there are the more localised municipal laws. Andrew J Boling of global practice Baker & McKenzie, explains,”Employers in the US generally have the discretion to change the terms ofcompensation, working hours and other issues such as holiday without theemployees’ consent – as long as there is no written contact between them. “Many European companies, used to employment laws that state thecontrary, don’t realise that the practice of confirming employment terms is notrequired in the US. Hence they frequently give employees more rights than theyare entitled to under US law. However, once Pandora’s box has been opened,State law will ensure the employer abides by those written entitlements.” Municipal laws, operating at City level, can impose more substantialobjections and penalties on an issue the other two laws also cover –discrimination. While the savvy HR professional can take advantage of theplethora of free expert advice on US employment law (www.bakernet.com, forexample), guarding against charges of discrimination involving age, gender,ethnicity or sexual orientation plus claims of sexual harassment, requiresconstant vigilance and pre-emptive action. Philip M Berkowitz is chair of the American Bar Association Employment LawCommittee (International Law Section) and a partner in the employment lawdepartment of Salans, Hertzfeld & Heilbronn in New York. He says overseasexpatriates are often a source of liability in the US because they have notbeen properly appraised of the legal issues. “The US is the only country which has jury trials and high exposure forclaims such as sexual harassment and age discrimination. US discrimination lawsand the punitive damages permitted are subject to ridicule in many European andother countries where Americans are considered overly sensitive. “Maybe that is true, but US culture does not permit certain practicesand executives who walk in without sufficient training – and don’t take theirobligations that our statutes demand seriously – risk getting their employersinto trouble in a substantial way,” says Berkowitz. Even the best-run companies can fall foul, as Coca-Coladiscovered (to thetune of $192 million) when it recently settled a class action lawsuit filedagainst it by a group of employees who felt the company’s standard operatingprocedures discriminated against minorities. “The courts have recognised the system has become very dangerous foremployers. As a result, those who take careful steps to monitor their HRpractices and provide relevant training, who make explicit that certain conductis prohibited and who follow up on complaints with the appropriate time andenergy, can avoid such penalties even if discrimination has occurred,”adds Berkowitz. Boling agrees that forewarned is forearmed, “Emphasis should be given –ideally to all employees but certainly to any executives being expatriated tothe US – that even an innocent or well-intentioned remark may be in violationof local laws.” Don’t think that just because your company is adhering to laws acceptable inyour own country these will be honoured in the US. Adds Berkowitz, “One ofour clients is a German multi- national whose employment practice in Germanyprevented employees over a certain age rising beyond a certain level in thecompany. US courts are increasingly allowing defendants’ overseas employmentpractices to be admitted into evidence – and juries are drawing adverseinferences from them. “My clients discontinued that practice, even in their own country,because of the possibility that they would risk a claim of age discriminationin the US and the attendant jury trial and punitive damages that couldresult.” Further legal linkswww.bakernet.comwww.cliffordchance.comH-1B VISA’S can be minefieldOne area of employment law that resembles a minefield concerns the H-1Bvisa, offered to foreign employees when sponsored by companies to fill certainprofessional or specialised positions in the US. Paul Virtue, former USImmigration and Naturalization Service general counsel, now an employment lawspecialist with Washington DC’s largest law firm, Hogan & Hartson,highlights one pitfall which HR professionals should be aware of.”When completing a Labor Condition Application for H-1Bemployees, try and anticipate all the different sites where those individualsmay be required to work. This is particularly important for those needing to betransferred during a multi-location project. Otherwise the Department of Laborwill need to approve a new LCA, to be posted in two conspicuous locations for10 days, before the employee can begin working there. “Usually approval takes less than a week, but if the DoLexperiences computer problems as it did earlier this year, the process can takeup to six weeks,” says Virtue.”The H-1B regulations are not particularly clear indefining a temporary location – but the DoL has lots of firepower in itsenforcement arsenal and will issue fines for LCA violations. Always have avalid LCA in place for each location where your H-1B workers may be required tooperate, including clients’ offices if relevant.” Comments are closed. Related posts:No related photos.