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International Outsourcing Law and Practice - Employment Issues

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Bayart Christian
Christian Bayart



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Ilse Bosmans



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02 December 2013

Christian Bayart and Ilse Bosmans have written a chapter on employment issues in the compilation “International Outsourcing Law and Practice” edited by Herald Jongen and published by Kluwer Law International. This work was published for the first time in 2008 and has been regularly updated since, most recently in June 2013.

The chapter on employment issues deals with the HR and employment law compliance issues triggered by an outsourcing and the legal boundaries of the parties’ playing field.

In the first part of the chapter, an overview is given of the main points for attention and specific issues that must be examined for each jurisdiction involved in the outsourcing. This covers in particular the following topics:

  • what types of regimes exist across the world regarding the transfer of the employees from the customer to the supplier (or from the supplier back to the customer, or from one supplier to another supplier);
  • whether the employees to be transferred in the context of an outsourcing can refuse to transfer;
  • the consequences of the transfer on the employees’ terms and conditions in general, and on the employees’ collective terms and conditions and their occupational pension entitlements in particular;
  • the liabilities of parties relating to the past and future employment of the transferring employees;
  • dismissal of employees in the context of an outsourcing;
  • the role of the employee representative bodies in the context of an outsourcing transaction;
  • the arrangements that must be agreed in relation to the expiry or termination of the services agreement (exit arrangements); and
  • the process of an outsourcing (i.e., the due diligence exercise and the contract negotiations), including the main conflicting interests between a supplier and a customer and the key employee related practical and commercial issues that have to be addressed during the contract negotiations.

A second part of the chapter focuses on the transfer of employees and the rules that have been introduced in that respect in Europe (i.e. the rules on a transfer of an undertaking set out in the Acquired Rights Directive and the European Court of Justice’s case law on this topic). The final part of the chapter highlights the country specific points of attention for some European and non-European countries, including Belgium, China, the Czech Republic, France, Germany, India, Italy, the Netherlands, Poland, Spain and the United Kingdom.

Download the chapter.