UK Employee contract questions.

[gteight]

Hi All,

I'm a UK citizen who's been interviewing with a company in the fin-tech sector (company based in Bulgaria, but their international/expat employees all face off against an entity in the Cayman Islands) and have received an employment offer over recent days. The contract is very short (only 2 pages, whereas contracts I've signed historically have been over 20 pages long), so I reached out to the employer for clarity around a few points. I have a few ongoing concerns as per below that I was looking for some clarity on. I would point out that at this time, the company only has a small presence in the UK with a couple of employees working from home, the main company business takes place outside the UK.

1. The employer has advised the offer for employment would be extended by a Cayman Island's legal entity and would be subject to the laws and regulations of the Cayman Islands. This concerns me as living in the UK, I would have hoped the contract would be subject to UK law. Are there major legal concerns with the contract being subject to the laws of the Cayman Islands and not UK laws?

2. There is no mention of pension benefits/contributions in the contract. I understand by law, there is a requirement for employers to pay into a pension for employees in the UK? Does this change if the entity employing me is outside the UK, even if I'm working in the UK?
The employer advised the following when I asked them about the pension contributions - "You would be responsible for setting up, making paycheck deductions and contributing towards a pension benefits plan, at your own discretion."

3. The employer also noted they could either pay me the salary gross and I would be responsible for making all tax contributions etc or they could engage a third party service to help with the relevant benefit contributions etc. I'm concerned here that I might be responsible for arranging all the local tax deductions etc, sounds like it could be expensive if this isn't done correctly and you end up with a large tax bill down the line..


Thanks for taking the time to read and help here.

Best,

Gteight

[ULA]

In answer to your questions:

1. If your contract is to be covered by Cayman employment then this would mean that potentially the employment laws of the UK would not apply. There is the Labour Law of 2011, linked to below, which seems to be one of their main pieces of employment legislation in the Cayman Islands:

http://dlp.gov.ky/portal/pls/portal/docs/1/13054482.PDF

2. The determination of whether you would need to be auto enroled into a company pension scheme would be based on a number of aspects:
* what currency are you being paid in?
* does your contract if employment base you in the UK
* is the company paying NI contributions for you in the UK
* the overiding factor is whether you would be considered as "ordinarily based in the UK."

3. I cannot comment on this point other than to say that yes this could be a possiblity.

Hope this has been helpful.

[gteight]

thanks so much for your response.

1. Is it possible that I can work permanently in the UK, under an employment contract that is not governed by UK law? Apologies for the elementry question but I'd have thought that just by working in the UK, I would end up being covered by UK employment law?

2. I will be paid in GBP
The contract of employment will base me in the UK
Situation around NI contributions unclear at the moment.
Yes, I would be ordinarily based in the UK for business.

[ULA]

1. Yes it is possible. A company can determine which jurisdiction the contract come under in this situation and it may be based on which gives them the more favourable terms.

Is the company that you are going to work for a registered ccompany in the UK or only in the Cayman Islands? May have ssome relevance but will need to do some research around case law so may take me a while to get back to you.

2. Then they may well have to provide an auto enrolled pension in the UK for you. Again more research required.

As.you can tell this is not straight forward just because you are working in the UK.

[gteight]

thanks again for your response. I never thought signing an employment contract would bring up so many complicated questions!

The company does have a UK registered entity but this a non-operating entity I am told.

[gteight]

Hi,

I'm just on the verge of signing an employment contract (as a UK contractor for a Cayman Islands based fintech) and there is the following indemnification clause in it. Please can someone advise if this type of clause is reasonable and standard?

"The contractor agrees to indemnify and hold harmless (the company), and its respective affiliates, officers, agents, employees and permitted successors and assigns against any and all claims, losses, damages, liabilities, including but not limited to any third party claims and liabilities in connection with any copyrighted work, penalties, punitive damages, expenses, reasonable legal fees and costs of any kind or amount whatsoever, which result from or arise out of any act or omission of the contractor that occurs in connection with this agreement. This indemnification will survive the termination of this agreement".

Many thanks

[atticus]

This clause seeks to make you responsible for any liability that may arise to third parties as a result of your breaches of any of the other clauses of the agreement. I have often seen this type of clause.

Given the references to Fintech and the Caymans I am guessing that the contract may be quite beneficial for you. Can you insure against potential liability under this contract? consult a broker specialising in professional indemnity cover.

[ULA]

gteight doe this relate to your previous post regarding this contract? UK Employee contract questions. - LegalBeagles Forum

If so I will merge the threads as it is more helpful to keep everything related to a subject, even if it is a different question, on the one thread. Helps those of us providing the advice.

[gteight]

Yes, it all relates to the same issue. I contine to work through the situation. Thanks very much to all for their helpful comments.

[ULA]

Can I be clear are you being offered a contract position or a permanent position?

It may just be easier (as it is a short document) and if you would like me to review in context of the full document and your other query for you to send it over to me by PM.