Global Mobility Contracts

Overview of Global Mobility Contracts

Global mobility contracts are employment contracts that are given to employers and employees when an international transfer is taking place. The transfer may be short-term, long-term, permanent or for a brief business trip.

With global mobility contracts, employers should look at the laws of both countries to ensure the transfer is legal. This includes evaluating immigration law, employment law and taxation in each country.

In terms of employer responsibility, there is plenty of variation within global mobility contracts. Some contracts demonstrate that the original employer will have little responsibility, whereas others promote shared responsibility over the employee and their work.

Types of Global Mobility Contracts

There are three main types of global mobility: 

Dual Employment

When an employee is transferred to the UK but maintains a working relationship with their host country employer, they receive a dual employment global mobility contract.

If the employee is still active in both organisations, the contract must take into account the laws of both countries, including taxation, benefits, employment obligations and payroll. This is known as a twin contractual relationship.

Dual employment is advantageous for the home country and host location as the employee is still offering their skills to both employers. It allows employers to share their duties, which could reduce the workload for each organisation.

On the other hand, dual employment can be stressful as employers must ensure their processes are compliant in both countries. For example, the host employer needs to look into taxation in both the UK and their own country.

It is important to ensure that any employee wishing to be dual employed as the correct visa permissions in place to do so.

Secondment

When international employees have a secondment contract, they must follow their local contract as they are still officially employed by their home country organisation. Often, the UK employer pays a fee to the original employer to keep their member of staff temporarily.

As a result, all employment conditions, such as salary, leave and pension, are maintained unless specified otherwise.

Secondment can be a way for employers in the UK to benefit from a global workforce without committing to a permanent transfer. Foreign employers have the opportunity to receive payment for their employees, and know employees will return to them after the secondment. Workers will need to apply for a Secondment Worker Visa if their overseas employer is transferring them to the UK to do an eligible job for a different organisation.

A downside of secondment is that the host employer loses their staff member temporarily, which could lead to complicated changes in their workplace.

Transfer

This type of global mobility contract involves sending employees to work in the UK by establishing a legal entity in the country.

It can be very challenging to obtain temporary employment contracts in certain countries or companies, so permanent transfers are sometimes the only option.

However, transfers are the least favourable option as they involve the most commitment and compliance. Workers will need to apply for a Senior or Specialist Worker which allows them to come to the country and take on a role at an employer’s UK branch

Key Considerations for Your Global Mobility Team

When deciding whether to pursue global mobility in the workplace, it’s important for employers to consider their business objectives and reflect on the different ways in which global mobility may impact profit, skills, employee retention and satisfaction. 

The long-term consequences should be taken into account just as much as the temporary changes. Would establishing a relationship with a UK employer lead to more risk or reward for the company? 

Cultural Differences

It is also crucial to learn about UK culture and apply this to any communication with UK employers.

This not only increases the chances of securing a positive relationship with a British employer, but it also puts the employee in a better position to move to the UK.

Employment Laws

When an employer is considering global mobility, they must learn the employment law of the country they are dealing with, which is often time-consuming.

Employers should consider the different standards in the UK to ensure they feel comfortable with their employees working there. For example, the annual leave allowance, sickness pay and health and safety laws are all key factors that differ significantly between countries.

Immigration Law

In order to establish a compliant working relationship with a UK employer, foreign employers must be familiar with UK immigration law. If not, the employer is risking breaking a UK-specific law and facing potentially serious consequences.

It’s advisable to work with an expert, such as an IAS immigration lawyer, to avoid legal issues with global mobility contracts. Get in touch with us on +44 (0)333 305 9375 if you would like further support. 

Taxation

Taxation rules differ depending on the type of global mobility contract.

For example, people on secondment in the UK will be liable for income tax if they have UK resident status. However, dual employment contract holders are likely to pay less tax in the UK as they will primarily be taxed at home.

Global Mobility Strategy Guidance

The key to successful global mobility in business is planning. It is recommended to plan each step in advance, taking into account any possible obstacles that could prevent the contract from being finalised.

Before focusing on the details, employers may want to make a general plan based on their business objectives. Each consequence of global mobility should lead to either a boost for the business or a risk that can be mitigated.

At this stage, it’s sensible to gather data from stakeholders. Figures will help employers to see how the global mobility scheme could objectively improve their business.

Following the general plan, specific details can be formulated. Each one should be relevant to the overseas location. For example, plans for payroll must reflect the host location’s laws and regulations surrounding pay.

Global mobility in HR should be uniform to ensure each employee’s case is handled in the same way. For instance, the employer should create the same system for submitting mobility requests, recommending staff members and carrying out interviews or meetings relating to this scheme.

Employers may want to introduce the project to their personnel by outlining the benefits of offering global mobility. They must also be prepared to answer questions about the risks of doing so.

How Can IAS Help?

We understand that global mobility is not a straightforward process for all. However, our immigration lawyers can advise on global mobility contracts in a wide range of situations, which reduces your stress as an employer.

We are trained in immigration and employment law in a wide variety of countries. Wherever you are in the world, you can benefit from our services. IAS are able to provide in applying for the appropriate visas for potential and existing staff members. The team can also help provide information on how to apply and comply with the rules surrounding Sponsor Licences in the UK.

Please get in touch with IAS on +44 (0)333 305 9375 if you are interested in global mobility contracts in the UK and the importance of global mobility for your business.