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Where to Turn When You Are Having Secondment Thoughts
Practical Law Legal Update 1-524-3696 (Approx. 4 pages)
Where to Turn When You Are Having Secondment Thoughts
by Type AUTHORING GROUP information here.
| Published on 22 Feb 2013 • USA (National/Federal) |
Resources to assist employers that are considering secondment arrangements or drafting secondment agreements.
A secondment is a temporary assignment of an employee from one organization (employer) to another (often referred to as the host) for a specified period of time, usually to carry out a particular project or to cover the post of a critical employee who is on a leave of absence. A secondment can be a transfer within the same organization or between two unrelated business entities. It can also be a domestic or overseas (or expatriate) assignment. Typically, an employer and a host memorialize their secondment arrangement in a formal secondment agreement. The employer often supplies the seconded employee with a separate letter that describes the terms of the secondment.
Parties often enter secondment agreements to:
- Fill temporary needs of the host with an employee:
- who has specialized training or skills;
- who is vested in performing assigned tasks well to strengthen the relationship between his employer and the host; and
- whom the employer has vetted for the assignment.
- Train the seconded employee on the practices and processes of the host, often a client of his employer.
- Strengthen ties between the employer and the host.
During a secondment, the employer continues to employ the seconded employee. The parties generally anticipate that the seconded employee will return to his original position with the employer at the end of the secondment.
Although the terms in secondment agreements vary, especially between domestic and overseas secondment agreements (the latter of which raises additional issues, such as multinational immigration and tax law compliance), they typically include provisions that:
- Clarify that the employer maintains the employment relationship.
- Set dates or achievements that, when reached, terminate the secondment.
- Identify:
- how the host will compensate the employer for the use of the seconded employee, if at all;
- which entity will provide for the seconded employee's salary and benefits during the secondment; and
- which entity will manage the seconded employee's day-to-day activities.
Practical Law Company has a collection of resources to help employers develop domestic and expatriate secondment agreements. These resources address the various legal, negotiating and drafting issues that employers should consider when:
- Deciding whether to form secondment relationships.
- Entering secondment agreements.
For more information about these issues, see the following key resources: