Agreeing to be seconded overseas to work as an investment banker may seem like a great opportunity. Often it is, but it needs to be approached from a state of preparedness. In particular, employees on secondment need to make provision for the return home from the outset. This will be of critical importance to the employee but it can sometimes be overlooked in the flurry of activity involved in the opportunity of a posting abroad.
Ensure, firstly, that you are clear about the terms governing the termination of an overseas assignment. What impact will these have on your continued employment?
In most cases, an overseas assignment will be facilitated either by the employee continuing to be employed by an existing employer, but with separate assignment terms, or by the employee entering into a new contract of employment with the host company but with a residual employment agreement with their original employer.
Whichever arrangements are in place, important factors to consider are:
- Does the end of the international assignment mean the end of your employment?
- Do you have a right to terminate the assignment without terminating your employment? Usually the employee is not given any right to terminate the assignment without terminating their employment as well. In contrast, it is usual for the employer to reserve the right to terminate the assignment but continue the employment
The precise terms relating to termination of the assignment should, therefore, be set out clearly in the contractual documents.
Things that might be included are: the option for the employee to return to his/her original position in the home country; the option to be reassigned to another country or company. If these options are not available or are unacceptable to the employee, the contract also needs to clarify what will happen next.
If you address these issues at the outset, they will often be far easier to resolve than if you leave them until the assignment is coming to an end, at which time the stakes can be high for both employer and employee.
Jonathan Exten-Wright is a partner specialising in employment law at law firm DLA Piper.