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Indian employees on overseas assignment remain subject to Indian labour laws in many contexts — employers must carefully structure international assignments to manage the dual applicability of Indian and host-country employment law.
The advent of liberalization and globalization has given rise to the necessity of inter-country communications and the transfer of skilful resources for the purpose of expanding businesses or for updation via knowledge transfers. The disparity in technological and logistical advancement witnessed across the globe, paves the way for the the inevitable cross-country movement of human resources, by way of overseas assignments.
The cross-border transfer of human resources is necessary for various reasons, particularly in the context of an increasingly interconnected and globalized world. Some of the key reasons why cross-border movement of resources is necessary are as under:
Cross-border transfer of human resources across different locations or countries facilitates the exchange of knowledge, expertise, and best practices. Deputation/Transfer enables companies to address these skill gaps by deploying experienced personnel from other regions.
Cross-border transfer of human resources to these new locations help in setting up and managing operations more effectively, ensuring a smooth transition into new markets. Debuting employees to foreign markets allows companies to gain firsthand insights into local business practices, customer preferences, and regulatory environments.
Cross-border transfer of human resources provides an opportunity for employees to work in diverse cultural settings, fostering mutual understanding and promoting cross-cultural collaboration.
The deputation, based on its dictionary meaning, would refer to “a small group of people who are asked or allowed to act or speak for others”.
According to the observations in Umapati Choudhary v. State of Bihar, ‘deputation’ is described by the Supreme Court of India:
“an assignment of an employee (commonly referred to as the deputationist) of one department or cadre or even an organization (commonly referred to as the parent department or lending authority) to another department or cadre or organization (commonly referred to as the borrowing authority).”
Deputation is thus a temporary assignment or transfer of the employee (“Deputee”) from one entity to another either within the same country (domestic deputation) or a different country (international deputation) (“Deputation”).
As per the Oxford Dictionary, ‘transfer’ refers to “an act of moving something or someone to another place, organization, team, etc.”
Permanent transfer of employees from one entity (home entity) to another entity (host entity), effectuated through transfer documents and separation documents executed between the employee by the home entity and joining documents executed by the host entity.
Sr. No | Particulars | Deputation | Permanent Transfer
As a business, having a comprehensive understanding of the intricacies involved in overseas deputation agreements is of utmost importance for maximizing the employee’s potential. In today’s interconnected world, employee-employer relations are rapidly adapting to meet the challenges of globalized markets. Consequently, deputation has emerged as a prevalent concept, enabling us to access a diverse talent pool and expand our operations globally.
Being fully aware of the organisation’s roles when they send human resources on assignments abroad is vital. While it is important to have adequate legal documents in place it is also necessary to equip the employees with the right information to foster a collaborative environment that optimizes international assignments, boosts employee satisfaction, and ultimately drives businesses forward in the global marketplace.
