The everywhere workforce is here. Yet, keeping track of country-specific employment laws and regulations can be challenging for any global company. With a simplified Employer of Record (EOR) solution in place, it doesn’t have to be.
With an Employer of Record, companies can mitigate risks, promote strong employee engagement, ensure legal compliance, and even attract top job applicants
As you expand across borders and boundaries, understanding international employment law can help your business succeed. Let’s explore what employment law is, and how to build your everywhere workforce quickly and compliantly.
What is international employment law?
Employment law is a legal framework that governs the relationship between an employee and their employer. On an international level, there is no one legal framework that applies across every country. Rather, each country has its own set of laws and regulations that apply to the employment relationship. Employment laws cover workplace safety, wages and benefits, pensions, working time, leave entitlements, discrimination, termination requirements and process, and even unemployment compensation.
Strict regulations require employers to provide a safe workplace, ensure fair wages, and manage employee hours. Employment and labor laws do not apply to independent contractors.
With the exception of 1099 workers and independent contractors, employment law provides rights and obligations for both employees and employers. For instance, if an employee makes false statements to harm an employer’s reputation, they breach their obligations towards their employer and face a lawsuit.
Some examples of employer misconduct include:
- Denying family and medical leave.
- Wrongful dismissal or termination.
- Age discrimination in employment.
- Failing to pay mandatory overtime.
Why is employment law important?
Employment law is essential to governing the relationship between employers and employees. Employment laws ensure fair treatment, equality in the workplace, and a healthy and productive work environment.
Employees and employers must understand the elements of the law to avoid legal ramifications. Employment law covers a range of issues, including:
1. Working conditions. Employment law ensures that employees are treated fairly, have safe working conditions, and are appropriately compensated.
2. Clear guidelines for employers. Regulations are built to promote a structured, legal framework for employers managing their workforce. Strong guidelines also reduce the risk of legal disputes.
3. Employee protection against discrimination and harassment. Laws provide employees with protection against workplace discrimination on the basis of race, color, religion, sex, sexual orientation, or other characteristics.
4. Employee benefits. Employment laws require that employers provide various benefits to their employees, including health insurance, retirement plans, and other benefits.
5. Compliance and accountability. Employment law also ensures that both employees and companies comply with the terms of the employment contracts and regulations, which helps in building a company culture of accountability and success.
What’s covered under international employment law?
Employment laws differ depending on the country. However, despite these differences, employment laws around the world cover fundamental elements that are crucial for businesses expanding globally, regardless of location.
Key areas include:
Employment contracts
Employment contracts vary drastically depending on the country. For example, U.S.-based employment contracts tend to include at-will clauses allowing termination of employment without notice and without cause or reason. In multiple countries such as Italy, permanent contracts cannot be terminated without a justified reason and also offer more extensive guaranteed benefits for employees such as national health insurance.
Wages and hours
Minimum wage and working hours differ depending on the jurisdiction. For example, France has a 35-hour workweek, while Japan has a longer, 40- hour workweek.
Discrimination and harassment
Protections against workplace discrimination based on race, age, gender, religion, disability, or other protected characteristics exist across many countries.
Digital privacy
Data privacy is critical for international employment law. As HR processes continue to digitize in the workplace, multinational corporations must create compliant data protection measures and programs. Businesses need to safeguard employee privacy rights by adhering closely to data privacy laws, which vary across countries.
Employee benefits
International employment law also covers regulations concerning health insurance, retirement plans, and other key benefits.
Layoffs, terminations, and other workforce reductions
Employment laws governing termination of the employment relationship, including permissible reasons for dismissal, required processes, wrongful termination, severance packages, and notice periods, differ by country. In most countries, employers are obligated to give employees advance notice of employment termination and have a justified reason for ending the employment relationship.
Leave policies
Vacation, paid time off, and paternity and maternity leave differ depending on the country. Nordic countries like Norway offer a 12-month maternity leave, while the United States has no national policy for paid maternity or paternity leave.
Diverse regulations and complex domestic employment laws across countries make it difficult to keep track of compliance. Understanding these variations is essential for effective global HR management.
What laws protect employees from job discrimination in the United States?
Employment laws vary depending on the country. In the United States, employment regulations vary by state and locally. Federal laws are passed by Congress, and the enforcement and administration of these laws typically fall under the jurisdiction of various federal agencies, including the U.S. Department of Labor. State laws, on the other hand, are passed by state-specific congress and are enforced and administered by the state and its agencies. The U.S. Equal Employment Opportunity Commission (EEOC) enforces laws protecting workers from discrimination.
U.S. employment law encompasses laws like the Fair Labor Standards Act (FLSA), Occupational Safety and Health Act (OSH), Americans with Disabilities Act (ADA), and the Family and Medical Leave Act (FMLA).
Let’s explore seven essential employment laws to know in the United States:
- Family and Medical Leave Act (FMLA) provides certain employees with 12 weeks of unpaid leave each year for specified family and medical reasons.
- Civil Rights Act of 1964 (Title VII) prohibits employment discrimination based on race, color, religion, sex, or national origin.
- Equal Pay Act (EPA) prohibits employers from paying unequal wages to men and women for performing substantially equal work.
- Americans with Disabilities Act (ADA) is administered by the U.S. Department of Justice to protect people with disabilities in the workplace.
- The Fair Labor Standards Act (FLSA) establishes standards for wages and overtime pay across most private and public employment.
- Occupational Safety and Health Act (OSH) assures safe and healthy working conditions for individuals.
- Employee Retirement Income Security Act (ERISA) establishes minimum standards for voluntarily established retirement plans in the private sector.
What’s the difference between international employment law vs. labor law?
Employment law regulates the individual employment relationship between employers and employees. Labor law comes into play when the employee is a member of a labor union or collective agreement.
While both labor law and employment law are established to protect workers and create fair workplace practices, they do cover different aspects of the employment and working relationship. Employment law focuses on the rights of individual employees. Labor law, on the other hand, centers on the collective rights of a group of workers through unions or collective agreements.
Understanding the distinction between these two areas is key for employees and employers to ensure compliance.
| Employment Law | Labor Law | |
| Responsibility | Regulates the individual relationship between employers and employees. This includes managing a wide range of issues affecting individual employees. | Handles the collective relationship between employers and labor unions, including the rights and responsibilities of unions and their members. |
| Scope | Covers hiring practices, workplace safety, wages, anti-discrimination laws, benefits, and termination procedures. | Handles collective bargaining, union organization, strikes, and labor disputes. |
| Examples | Guarantees safe work conditions.
Outlines guidelines for lawful termination and/or severance. Protects individual employees from workplace discrimination. |
Establishes the right to collective bargaining.
Regulates the process of forming and joining unions. Governs the conduct of strikes and lockouts. |
Stay compliant with international employment laws with G-P.
As you embark on your global growth journey, don’t let the stress of compliance slow your plans for global success.
As the recognized leader in the global employment market and standard bearer for industry compliance, G-P has over a decade of experience helping companies of all sizes plan, hire, and manage global teams.
Our SaaS-based global employment platform streamlines every step of global expansion, so you’ll never have to worry about juggling complicated employment laws and evolving regulations.
Our Global Intelligence Assistant (GIA™), combined with our dedicated team of in-country global experts on employment law, compensation, and mobility, provide guidance and 24/7 support, ensuring compliance from day one.
After all, the everywhere workforce has arrived. It’s time to imagine a new kind of success beyond borders and boundaries, today.
THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). G-P does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect G-P’s product delivery in any given jurisdiction.
