Overseas Working in Employment Contracts

When employees work overseas, contracts need to address jurisdiction, applicable law, and practical arrangements.

Applicable Law and Jurisdiction

Choice of Law

Employment contracts can specify which country's law applies:

"This contract shall be governed by and construed in accordance with English law. The English courts shall have exclusive jurisdiction over any disputes arising."

Rome I Regulation

For EU work, Rome I provides rules:

• Parties can choose applicable law
• Choice cannot deprive employee of mandatory protections of the country where they work
• If no choice, law of habitual place of work applies

UK Employment Rights Abroad

UK unfair dismissal and other rights may apply to:

• Employees working in UK territorial waters
• Peripatetic employees with UK base
• "Posted" or seconded workers
• Employees with sufficiently strong UK connection

Types of Overseas Arrangement

Short-Term Assignment

"You will be assigned to work in [country] for [period]. During the assignment, you will remain employed by the UK company on your existing terms, subject to the modifications in this assignment letter."

Long-Term Secondment

"You will be seconded to [overseas entity] for [period]. While seconded, you will remain employed by the UK company but will work under the direction of the host company. Your terms and conditions will be modified as follows..."

Local Transfer

"Your employment will transfer to [overseas entity] with effect from [date]. Your employment with the UK company will terminate and you will become an employee of the overseas entity on local terms."

Key Contract Provisions

Assignment/Secondment Terms

"During your overseas assignment:

• You will report to [local manager]
• Your base salary will be £[X] (or equivalent in local currency)
• You will receive the following allowances: [list]
• Housing/accommodation will be provided as follows: [details]
• Your normal place of work will be [overseas location]"

Duration and Early Termination

"The assignment is expected to last [period] but may be extended or shortened by agreement. Either party may terminate the assignment early by giving [X months'] notice. The Company may recall you earlier for business reasons."

Repatriation

"At the end of the assignment:

• The Company will arrange and pay for your return to the UK
• You will be entitled to a position of equivalent status and seniority
• If no suitable position is available, redundancy procedures will apply"

Financial Considerations

Tax Equalization

"The Company operates a tax equalization policy whereby you will pay the same amount of tax as you would have paid had you remained working in the UK. The Company will handle tax filings and meet any additional tax arising from the assignment."

Cost of Living Allowance

"You will receive a cost of living allowance of [X]% of base salary to reflect the difference in living costs between the UK and [country]."

Hardship Allowance

"In recognition of the challenging conditions in [country], you will receive a hardship allowance of [X]% of base salary."

Currency

"Your salary will be paid [in sterling / in local currency / split between currencies]. Exchange rate fluctuations [will / will not] be adjusted for."

Social Security

Posted Workers

For EU/EEA assignments under 2 years:

• May remain in UK social security system
• Need A1 certificate
• Benefits continue under UK system

Long-Term Overseas

"While working overseas, you will be subject to [local social security arrangements / continued UK NI contributions / both]. The Company will advise you of your obligations and assist with compliance."

Benefits During Assignment

Pension

"During the overseas assignment:

• You will remain a member of the UK pension scheme, OR
• Contributions will be made to the local pension scheme, OR
• An equivalent cash allowance will be paid in lieu of pension"

Healthcare

"The Company will provide:

• Private medical insurance covering you [and your family]
• Medical evacuation cover
• Access to local healthcare facilities"

Insurance

"Additional insurance during the assignment:

• Personal accident insurance
• Travel insurance
• Kidnap and ransom insurance (where applicable)"

Family Considerations

Accompanying Family

"The following benefits apply to accompanying family members:

• Relocation assistance
• School fees assistance for dependent children
• Spouse employment support
• Family flights home [X] times per year"

Emergency Return

"In the event of a family emergency, the Company will provide:

• Compassionate leave
• Emergency return flights
• Temporary accommodation if needed"

Practical Arrangements

Visas and Work Permits

"The Company will assist with obtaining necessary visas and work permits. You must comply with all immigration requirements. If a visa cannot be obtained or is revoked, the assignment may be terminated."

Accommodation

"The Company will provide:

• Temporary accommodation on arrival
• Assistance finding permanent accommodation
• Housing allowance of £[X] per month, OR
• Company-provided accommodation at [address]"

Relocation Expenses

"The Company will pay reasonable relocation costs including:

• Shipping of personal effects
• Storage of UK belongings
• Travel expenses for you and your family
• Temporary accommodation during transition"

Compliance Requirements

Local Law Compliance

"You must comply with all applicable laws of [country], including employment, tax, and immigration requirements. Breach of local law may result in termination of the assignment."

Data Protection

"Your personal data may be transferred to [country] for the purposes of administering your assignment. Appropriate safeguards are in place for such transfers."