Science of Compliance

FedEE Speed: Our country-by-country legal and economic data is designed especially for the busy HR professional and is available 24/7. Our helpline resolves 90% of problems raised within 4 working hours of us receiving them. You are never kept waiting to receive a reply if you contact us.

FedEE Practicality: We ask our members regularly what support and information they need to operate in their daily or occasional tasks and we deliver what they want in layman’s language. Almost half of our users have English as their second language and we constantly examine the words we use to minimise mistranslation and misinterpretation. We look for the practical outcomes of all developments and give steer arounds where we can find them.

FedEE Accuracy: We seek to verify all our data from multiple sources and edit our material three times before publication. We may still get it wrong, but such instances are rare.

FedEE Predicts: The future is an ever more uncertain place and FedEE is forever identifying trends and forecasting what HR should expect. We were right about the 2008-9 economic collapse and even moved our own administrative operations to stay in the EU before the Brexit vote in June 2016. We predicted the outcome by one percentage point. Predictions are always the best estimates of future outcomes based on an intelligent reading of trends. Nothing is predetermined, but probabilities must not be ignored.

 

 

The Multinational Paradox

Multinationals now account for

  • Over one third of world production,
  • More than half of world exports, and
  • 25% of world employment.

They are also, on average, more efficient than domestic companies, spend a much higher proportion of their income on research and development than other companies and generally operate as “good employers” in the formal economy. They are thus strategically very important for the world, provide a huge proportion of government tax revenue and are the principal reason why living standards are sustained at such a high level throughout the developed world – and increasingly in the developing world.

The irony, however, is that multinationals are frequently the focus for public criticism, tax and legal constraint. They are easy targets for anti-globalisation and environment movements, their transnational reach exposes the parochial weakness of national governments, and new taxes – such as the French digital tax – are designed to eat into their financial power base.

Above all, however, multinationals are subject to a multitude of laws that are either specifically designed for them – like the EU’s EWC rules, or US-China trade tariffs – or coincidentally affect multinationals more than other companies – like ante-trust and M&A rules. FedEE also regularly identifies laws which have been poorly implemented or transposed and court rulings that are clearly unjust. Many national labour courts also operate in such a biased way that an employer has little chance of winning their case.

HR professionals in multinational companies have to face a torrent of new legislation on a daily basis. This is especially the case in common law countries like the USA, UK and India because here the courts are constantly redefining what employers can or cannot do. Their reputational risks and perceived ability to pay also makes them especially vulnerable to challenges from even legally dismissed employees, #Me Too claimants, malware and union strike threats.

Although legal news sources report the basic facts, few lawyers or legal information services – apart from FedEE – highlight the legal or practical problems at the heart of a new law or legal precedent. Even less predict the outcomes of legal changes. For this reason most multinationals are steering blind through the choppy waters of an increasingly hostile world.

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The FedEE Story

FedEE was founded in June 1988 at a meeting of HR Directors at BP PLC’s Head Office in London.

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FedEE Services

FedEE offers a range of “must have” services to the individual Multinational employer.

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Why FedEE?

Multinationals are growing in number, transforming and require tailored support services.

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FedEE Consult

We provide a wide range of customised employment law and HR-related services to multinational organisations.

 

Key predictions for 2020

Economy: There are strong signs of overheating in developed economies and the OECD’s composite longer leading indicator is now below its lowest point since 2009. We are currently experiencing the longest period of a sustained upswing in the world economy since GDP figures were first published and unless there is a step change in the laws of economics we can expect a significant downswing by Q3 2020. This might take place even sooner if triggered by a significant world event such as conflict with Iran or further escalation of the US-China trade war.

Pay: We predict that there will be a surge in average earnings in many developed countries during the second half of 2019, but that this trend will be quickly reversed with the onset of a recession. Real earnings are already flat or reduced in many countries such as Japan and the UK and only in Norway and eastern Europe has there been a surge in real earnings over recent years. This will come quickly to an end by Q4 2019 and unless eastern European countries substantially reduce corporate and personal taxation (including social security) there will be a sharp fall in real earnings as unemployment rates climb.

Employee relations: We predict that the long-term decline in union membership across much of the world will be reversed in 2020. This will only take place, however, if unions undertake some serious reforms of their internal structures and political affiliations. The driving force for change will be “labour displacing technologies” with unions carrying the brunt of opposition to consequent job losses. The poorly sustained yellow vest movement in France has illustrated the importance of organisation and how right wing political movements fragment easily over time. Although the prevailing trend across the world has been towards nationalism this may only be the fore-runner of a new political ideology that will not be identifiable in conventional right-left terms. One of the driving forces will be a lifestyle-led independent approach to work that will be very different from the current “gig working relationships”. Companies must be ready for this change as it will have major implications for the future of employee relations and talent management.

Income tax: Governments like income tax because it is so easy to collect. As the total revenue from income tax falls due to declining employment levels (brought about by first a recession and secondly the progressive automation of all areas of activity) then the tax rates on the remaining employees will have to either increase, corporate tax rates rise or other forms of taxation will have to emerge. The aging populations of the developed world will also make public health systems become increasingly expensive, unless medical services can be successfully automated. It thus appear inescapable that 2020 will see a further rise in the “tax take” which in Europe could exceed. on average, 40% of GDP and begin to look like the burdensome levels currently suffered by Belgian taxpayers.

New laws: Employment laws, like taxes, grow faster than ever they are repealed. We have already seen a huge growth in needless bureaucracy develop in Europe as a consequence of GDPR. This is now spreading across the global through a series of look-alike laws. There is also a rapid rise in the number of practically difficult laws in the USA that are likely to spread both between US States and across the rest of the world. One prominent example is the New Jersey Equal Pay law that applies the principle of equivalent worth to a string of protected characteristics other than gender. Numerous court cases are also spreading unjust practices – such as the UK EAT ruling on holiday entitlements for part-time workers and the recent Sullivan v. Sleepy’s LLC case in Massachusetts that entitles commission-only retail employees an entitlement to overtime pay.

How prepared is your organisation even if just one of these predictions is realised? How do you stay in touch with changes in the probability of outcomes unless you are part of FedEE? No other organisation offers insights based on a deep understanding of underlying forces and is prepared to share them – however uncomfortable many potential outcomes may be.

 

 

Labour costs/shares

Labour cost increases include average wages and salaries and social security charges and are annual rates for the year to Q4 2018. Labour shares are the percentage of value added (VA) produced by an enterprise paid out through the total remuneration, in cash or in kind, to an employee in return for work done. There is no “correct” figure for either statistic, but companies can only afford to pay out a high proportion of compensation per unit of VA if they have achieved a high level of productivity.

Country/Region (Selected)% Labour Costs 4Q 2018% Labour Shares 2018
France2.558.9
Germany2.057.2
Belgium1.855.7
Luxembourg2.455.5
UK3.555.4
Finland1.554.0
Sweden2.353.7
EU2.853.3
Spain1.152.2
Czech Republic7.448.0
Italy2.244.9
Poland6.543.8
Irish Republic3.031.0

 

There is a wide variation in labour shares and no clear correlation with labour cost changes – although those countries with the highest labour cost increases have labour shares well below the EU average. It is also not clear why the Irish Republic has such a low labour share. Back in 1998 the share was 44.9%.

Global News

 

The FedEE HR Counsel Programme

Now there is an opportunity for HR professionals in multinational organisations to obtain a legal qualification that prepares them for a role as the departmental expert in employment law. FedEE’s Advanced Diploma in Multijurisdictional Employment Law (Adv Dip MELL) is a one-year part-time programme undertaken primarily through distance learning.

If you are a University graduate with at least three years relevant HR experience you may join the programme at any time. You do not have to possess a first degree in law and the programme will begin by preparing you to understand legal concepts and basic principles of law.

The programme focuses on ten principal jurisdictions – China, France, Germany, India, Italy, Japan, The Netherlands, UAE, UK and the USA. However, participants may also choose other jurisdictions for their personal research. There are a total of 24 modules to complete (two per month) and, as a graduate, you will possess greater knowledge of trans-border legal requirements than most conventional legal professionals.

The course is designed to fit in with a busy work schedule and if not completed within the year it may be extended for a further six months. The programme not only ends with a valuable qualification, but you will also be able to use the job title “HR Counsel” – as FedEE owns the term as a trade mark.

For further information please download the programme brochure and, if you wish, contact FedEE’s Legal Counsel, a qualified Barrister who heads up our team of Tutors, or click here to sign up today to participate in the course.

 

Press Releases and Newswires

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White papers

FedEE Member companies gain access to a wealth of information and guidance.

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Press Releases

FedEE’s latest press release distributed to media, newspapers and agencies. Here is a taste.

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Past Newswires

Examples of our fortnightly newswires sent to all FedEE Member organizations.

Travel Alerts

  • BRAZIL: With effect from 24th August 2019, Santos Dumont domestic airport in Rio de Janeiro will be operating a restricted service for one month due to maintenance work on the main runway.

    PHILIPPINES: Some areas in Luzon will experience power interruptions until the 25th August 2019 (Sunday) because of maintenance operations.

    CHAD: A state of emergency has been declared until November 2019 in Sila and Ouaddai regions where about 50 persons were killed in intercommunal conflicts since August 9th 2019.

    ZIMBABWE: Authorities has banned anti-government demonstration in the western city of Bulawayo. Expect a heavy security presence in this area. Stay vigilant and avoid any public demonstrations.

    SPAIN: A wildfire on the Spanish holiday island of Gran Canaria has triggered the evacuation of thousands of people. No fatalities have so far been reported.

    LIBYA: Until further notice, Mitiga International Airport in the capital Tripoli is closed due to random shelling.

    IRISH REPUBLIC: Flights have been temporarily suspended at Shannon Airport after a passenger jet caught fire. Ryanair pilots based in the Republic of Ireland will be on strike from 22nd to the 23rd of August 2019. Expect major flight disruptions.

    MAURITANIA: Reconsider travel to this country due to the threat of terrorism and the very high incidence of criminal activity.

    INDIA: A fresh flood alert has been issued for parts of the southern state of Kerala. The nationwide death toll from the annual monsoon has risen to at least 244. There is also a significant threat of military conflict with Pakistan that could affect the whole country.

    SPAIN: Ryanair cabin crew in Spain have planned 10 days of strikes in September 2019. These dates are 1st-2nd, 6th, 8th, 13th, 15th, 20th, 22nd, 27th and 28th September 2019. Furthermore, Iberia ground staff at Barcelona El Prat Airport have announced fresh strikes on 24th, 25th, 30th and 31st August 2019. Finally, expect train service disruptions as Renfe workers have called for industrial action on August 31st and September 1st 2019.

    PAPUA NEW GUINEA: Bougainville's Buka Airport remains closed due to safety concerns.

    CHINA: With effect from 27th August 2019, Air China will suspend Beijing-Hawaii flights due to weak travel demand.

    UK: Visitors who are travelling through Gatwick Airport could face travel disruption between 20th – 24th August. This is because security staff represented by the Union Unite has called for a strike.

    INDIA: Trains to and from Jaipur have been cancelled between until 24th August due to maintenance work taking place at Jaipur Railway station.

    JAPAN/SOUTH KOREA: South Korean budget carrier Eastar Jet will temporarily suspend three routes to Japan. Korean Air will stop its Busan-Sapporo flight from September.

    HONG KONG: Expect significant flight cancellations due to frequent protests – some in airport area.

    PORTUGAL: Portuguese cabin crew trade union members will go on strike for five days from August 21st 2019. Expect flight disruptions or cancellations.

    BANGLADESH: Currently, there is a nationwide record-high dengue outbreak in the country. There is no treatment for dengue, however, early detection and access to the proper medical care will greatly reduce the risks of fatality.

    FINLAND: Kuusamo Airport will be closed until the 30th of August due to runway repairs.

    PARAGUAY: Stay vigilant as demonstrations are taking place frequently in the downtown area of Asunción, particularly in the proximity of government buildings and offices, often without warning. 

    UK: Merseyrail staff are planning to launch industrial action on 24th August, 3rd September, 5th September, 30th September and 2nd and 4th October as driver-only trains dispute reignites. Members of the National Union of Rail, Maritime and Transport Workers (RMT) has announced it will also strike nationally on Saturday 17th August 2019.

    MALAWI: Passenger who are using Malawian Airlines should expect flights disruptions at Kamuzu International Airport in Lilongwe as Malawian airlines cabin crew are staging a sit-in over pay and working conditions.

    COSTA RICA: Please take care when buying any spirit-based drinks as there have been a number of deaths and cases of serious illness in the country caused by drinking alcoholic drinks containing methanol.

    KYRGYZSTAN: Please stay vigilant in Kyrgyz-Tajik border areas and check local media reports before you travel.

    SPAIN: Rail workers in Spain have called strikes on 31st August and September 1st 2019.

    SOUTH KOREA: With effect from 3rd September 2019, Korean Air Lines will suspend its flights between the South Korean city of Busan and Japan’s Sapporo following a worsening diplomatic and economic row between the two nations.

    USA: Southwest Airlines has extended cancellation of Boeing 737 Max flights until 5th January 2020. It will also end its service at Newark Liberty International Airport on 3rd November 2019.

    ITALY: Milan’s Linate Airport is temporarily closed until October 27th 2019. Flights are being transferred to Malpensa airport.

    RUSSIA: Visitors to Russia could soon find their credit and payment cards do not function when they are in the country. A new law that has support from the central bank will effectively make Visa and Mastercard unlawful. The companies are therefore preparing to close down Russian operations.

    EGYPT/UK: British Airways has temporarily suspended flights to Cairo due to security concerns.

    DOMINICA: There is now a departure tax for leaving Dominica. In most cases, the tax is included in the cost of your air ticket. However, if you are concerned check and confirm with the airline or travel agent before travelling.

    INDIA/PAKISTAN: Normal air traffic operations between India and Pakistan have now resumed. United Airlines will restart their daily nonstop service between New York/Newark, New Delhi and Mumbai from 6th September, 2019.

    USA: Iowa's Sioux Gateway Airport will close for several days in August and September due to runway construction.

    KOSOVO: You must register with the Ministry of Internal Affairs for a Residence Permit if you plan to stay in Kosovo for longer than 90 days. If your stay is 90 days or less, it is necessary to notify the nearest police station about where you’re staying if it is not a hotel.

    ZIMBABWE: The government has banned local trading in foreign currencies, including the US dollar. The only legal tender in the country is the “Zimbabwe Dollar”. Expect a shortage of physical cash.

    INDIA: The Cochin International Airport in Kerala will be shut for flights from 10 am to 5:30 pm starting November the 19th until late March - due to runway improvement.

    UGANDA: The Ugandan Ministry of Health has confirmed an outbreak of Ebola in Kasese District in western Uganda. Nearly 1,400 people have died over the last 10 months - around 70% of all those infected.

    TANZANIA: Plastic bags are now banned in Tanzania. Visitors are urged to remove disposable carriers from luggage before arriving in the country.

 

Join FedEE Today

Many of the world’s largest multinational companies already belong to The Federation of International Employers (FedEE®). We have a Worldwide membership – with particular concentrations in North America, Western Europe, India, Japan and China. A high proportion of our members have been part of FedEE for many years and tell us we provide a both unique and excellent service with great value for money.

If your company has over 200 employees in two or more countries, has its own in-house HR department, and has been operating for two or more years then you really cannot afford to operate without being part of the Federation. The approval process takes less than a day and for immediate access to our services we have an online credit card payment facility. Membership costs as little as €895 a year. Sign up now.

Why not take a short tour of our knowledge-base before joining FedEE® to see the nature and extent of the employment law, HR data and support that we offer? Please contact our Membership Secretary on membershipservices@fedee.com to arrange for a one-to-one webinar for you and your colleagues, arranged without obligation and entirely at your own convenience.

 

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Our periodic review of global trends affecting HR practitioners.