US-Arbeitsrecht – Informationen und praktische Hinweise

Foreign companies opening a manufacturing facility in the U.S. are faced with broad U.S. labor laws which by no means do have anything in common with the erroneous belief in an outmoded principle of “hire and fire”. Instead – to the surprise of many foreign companies – there are many laws, standards, judicial decisions and institutional guidelines with the objective to provide employees in the U.S. with strong legal protection. US. companies are not required to provide employees with a pension, but, if they do, a bundle of laws apply. Law does not mandate severance payments, but they are governed by contracts, policies, and past practice. Contracts could be labor contracts governed under the National Labor Relations Act and be formed by a handbook policy. Or, there could be a history of paying severance such that employees terminated in the future become entitled to severance payments. And, there may be a plant closure triggering certain payment obligations under the Federal Worker Adjustment & Retraining Notification Act or state plant closing or plant shutdown laws. And surprisingly, the practice of private employers (predominately uninformed foreign companies) of allowing employees to take time off for overtime hours at the rate of one and one half hours compensatory time off for every one hour of overtime worked, as opposed to paying promptly in cash for the overtime hours, violates Section 7 of the Fair Labor Standards Act.

The brief summary of the statutes referred to in the following (Labor Management Reporting and Disclosure Act, The Americans with Disabilities Act, Plant Closings and Layoffs, The Family and Medical Leave Act and Fair Labor Standards Act) shall give a short glimpse of the perils to the foreign investor and his attorney which when not properly taken care of by an appropriate labor and plant organization may pose a financial threat to a company not to be underestimated.

The information provided shall make the reader sensitive for U.S. employment issues and provide him and her with the material for questions to be asked when mandating its local attorney with drafting an employee handbook and preparing the foreign company for its legal responsibility as an employer under the umbrella of U.S .labor laws. Such attorney should consider issues like avoiding to create a contract by handing out the handbook, maintaining an “at-will” relationship, avoiding probationary periods, establishing benefits clearly, setting forth work rules, procedures and required policies, instructing supervisory personnel how to use the handbook and its procedures, considering possible union contract conflicts, setting forth who may exclusively modify the rules laid down in the handbook and securing compliance of all company personnel with the handbook. Since laws are changing over the years and vary from state to state, consulting your local attorney is necessary to be informe…