Duty of care is a legal obligation requiring someone (such as an employer) to maintain a “reasonable” standard of care when handling issues that could cause harm to others. Hence, poor expat health benefits can mean big trouble for multinational employers if they’re ever found negligent.
Multinationals need to be aware of their legal obligations in every country they operate in. Legislation varies all over the world – the UK, Australia and New Zealand are known for tough duty of care legislation. In Germany, liability for health-related costs can sometimes extend to those visiting expatriate family members.
Multinational employers that fail to meet their duty of care obligations toward expat employees – whether intentionally or accidentally – could land in court. This can easily translate to either expensive lawsuits or even criminal charges.
How can expats and their multinational employers steer clear of trouble?
- Be aware of laws governing the employer’s obligations. Duty of care law in the United States, for example, looks very different than it does elsewhere in the world (each of the 50 states is free to pass its own laws governing duty of care). Large corporations may operate across vastly different regulatory climates.
- Make detailed documentation of their benefit plans readily available. As McKinley International Risk Management observes, “companies will spend millions on expensive international insurance plans but skip expatriate policy and good documentation, a risk management tool that over time doesn’t cost more than paper it is printed on.”
- Keep detailed records. This ties in with the above. Lawsuits involving duty of care issues often hinge on proving defendants (such as negligent employers) knew their actions (or lack thereof) would likely result in harm. Both multinationals and their expat employees should keep records of any correspondence – it could be critical evidence later on. Expats also shouldn’t hesitate to contact their employers if they’re unsure of the details of their health benefit packages.
In an ideal world both multinational companies and the expats they employ would always act in good faith. Unfortunately, this is not always the case, and given today’s complex legal climate even the best intentions can easily turn into costly lawsuits. As always, knowledge is power. Good documentation and effective communication between employers and expats over health benefits will ensure everyone stays healthy, happy and out of court.