Global HR: What It Means for Employers

What it means in practice

What the term means. "Global HR" is a management term, not a legal one; no federal statute or regulation we found defines it, and BLS discontinued its International Labor Comparisons program "as of 2013." In practice it means running the usual HR functions (hiring, pay, benefits, compliance, records) across borders. For a U.S. employer that usually involves three groups: U.S. citizens and residents sent abroad, people hired in other countries, and foreign nationals working in the United States. This page describes U.S. federal law only and is general information, not legal or tax advice.

Anti-discrimination law follows U.S. citizens abroad. Title VII of the Civil Rights Act of 1964 and the ADA define "employee" to include, "with respect to employment in a foreign country," a U.S. citizen (42 U.S.C. 2000e(f); 12111(4)), and the ADEA covers U.S. citizens employed "in a workplace in a foreign country" (29 U.S.C. 630(f)). The EEOC's guidance on multinational employers says these laws cover U.S. citizens employed abroad by a U.S. employer or by a foreign company it controls. It adds that the Equal Pay Act does not apply outside the United States, though sex-based pay claims abroad are covered by Title VII, and that an American employer "cannot transfer an employee to another country in order to disadvantage the employee" because of a protected trait.

The control test and the foreign-person exemption. If an employer controls a corporation incorporated in a foreign country, that corporation's prohibited practices are presumed to be the employer's (42 U.S.C. 2000e-1(c)(1)). Control turns on four factors: interrelation of operations, common management, centralized control of labor relations, and common ownership or financial control. The ADEA (29 U.S.C. 623(h)) and ADA (42 U.S.C. 12112(c)) use the same factors, and all three laws exclude the foreign operations of a foreign person not controlled by an American employer. Title VII also does not apply to "the employment of aliens outside any State" (42 U.S.C. 2000e-1(a)); the EEOC states that non-U.S. citizens "are not protected by U.S. EEO laws when employed outside the U.S."

The foreign-law defense. Each of the three laws permits an otherwise prohibited action toward an employee in a foreign workplace if complying would make the employer, or a corporation it controls, violate that country's law (42 U.S.C. 2000e-1(b); 29 U.S.C. 623(f)(1); 42 U.S.C. 12112(c)(1)). USERRA, the military reemployment law, follows the same pattern of control presumption, foreign-employer exclusion and foreign-law exemption (38 U.S.C. 4319).

Wage-hour and leave laws stop at the border. Under 29 U.S.C. 213(f), the Fair Labor Standards Act minimum wage, overtime, recordkeeping and child labor sections do not apply to an employee whose services during the workweek are performed in a workplace in a foreign country; they still apply in listed places such as Puerto Rico, the Virgin Islands, American Samoa and Guam. The FMLA applies only to employees in a State, the District of Columbia or a U.S. territory or possession, and employees outside those areas "are not counted for purposes of determining employer coverage or employee eligibility" (29 CFR 825.105(b)). A company with 45 U.S. workers and 20 in Canada therefore does not reach the 50-employee count through its Canadian staff. The OSH Act likewise applies to workplaces in the States, the District of Columbia and listed territories (29 U.S.C. 653(a)).

Social Security and Medicare for Americans abroad. FICA "employment" includes service outside the United States by a U.S. citizen or resident as an employee for an "American employer" (26 U.S.C. 3121(b)): the U.S. government, a U.S.-resident individual, a partnership with at least two-thirds U.S.-resident partners, a trust whose trustees are all U.S. residents, or a corporation organized under U.S. or state law (3121(h)). IRS Publication 54 says these taxes generally do not apply to wages for work abroad unless an exception applies, such as working for an American employer, a totalization agreement, or a voluntary Treasury agreement covering a foreign affiliate. A foreign affiliate is a foreign entity in which the American employer holds at least a 10 percent interest; the employer extends coverage with Form 2032, and once the agreement is made "coverage cannot be terminated" (3121(l); Publication 54).

Totalization agreements. Section 233 of the Social Security Act authorizes agreements under which work is covered by one country's system "but not under both" (42 U.S.C. 433). SSA's operations manual says they eliminate dual coverage and taxation. The 31 partner countries include Canada, the United Kingdom, Germany, France, Japan, South Korea, Australia and Brazil; POMS GN 01701.005 lists all of them with effective dates. Agreements generally cover work where it is performed, with exceptions. Under the U.S.-German agreement, a "detached worker" sent temporarily to work for the same employer or an affiliate stays covered only at home if the assignment is expected to last no more than 5 years and the employment existed before the transfer. In SSA's example, a U.S. citizen sent to France for an assignment expected to last more than 5 years is covered only by the French system. Publication 54 notes that only wages paid on or after an agreement's effective date can be exempt.

Certificates of coverage. A certificate of coverage, issued by SSA or the partner country's agency, certifies that the named worker is covered in the issuing country and exempt in the other. SSA says the employer or its representative should request it for employees; U.S. certificates come from SSA's Office of International Programs, online or by fax, and SSA sends the employer a duplicate copy to show the other country's tax authorities if asked. A foreign certificate for a worker in the United States "should be retained in the office of the U.S. employer in case the Internal Revenue Service (IRS) questions why the company is not withholding and paying FICA taxes."

Income tax withholding and the foreign earned income exclusion. Publication 54 states that U.S. employers must generally withhold U.S. income tax from U.S. citizens working abroad unless foreign law requires the employer to withhold foreign income tax. Withholding is not required on wages the employer reasonably believes the employee will exclude; Form 673 is an acceptable statement from a U.S. citizen, but the employer must keep withholding if it has reason to believe the employee will not qualify. The exclusion is the employee's election under 26 U.S.C. 911, claimed on Form 2555. It requires a foreign tax home plus either bona fide residence abroad for an uninterrupted period including an entire tax year (U.S. citizens) or presence abroad for at least 330 full days in any 12 consecutive months (citizens or residents). The IRS says it reduces regular income tax "but will not reduce your self-employment tax."

Example 1: the exclusion cap (our arithmetic). A U.S. citizen who meets the physical presence test for all of 2026 earns $150,000 of foreign earned income and claims no housing exclusion. The limit is the smaller of $132,900 or the foreign earned income, so $132,900 is excluded and $17,100 ($150,000 - $132,900) is not. Section 911(b)(2)(A) applies the limit "on a daily basis," and Publication 54 says it is prorated for a partial year: an employee who meets a test on 200 days of 2026 has a cap of about $72,822 ($132,900 x 200 / 365).

Example 2: detached worker timing (our arithmetic, U.S.-German rule). An American employer sends an existing employee to its German affiliate for an assignment expected to last 4 years. That is within the 5-year limit and the employment predates the transfer, so the employee can remain in U.S. Social Security only, documented with a U.S. certificate of coverage; because the employee works for an affiliate, POMS also requires a section 3121(l) agreement. Had the assignment been planned at 6 years, the detached worker rule would not apply.

Foreign nationals working in the United States. The EEOC says employees working in the U.S. are protected "regardless of their citizenship or work authorization status," with a narrow exception for foreign employers whose treaty lets them prefer their own nationals for certain positions. USCIS states that employers must complete Form I-9 "for every individual they hire for employment in the United States," citizens and noncitizens; see our Form I-9 page. Two sponsored classifications, at a definitional level: H-1B covers services in a specialty occupation, generally requiring at least a bachelor's degree in a specific specialty, with a Department of Labor-certified Labor Condition Application, admission of up to 3 years extendable to a total of 6, and an annual cap of 65,000 plus 20,000 for beneficiaries with a U.S. master's degree or higher. L-1A lets an employer with a qualifying foreign parent, branch, subsidiary or affiliate transfer an executive or manager who worked for it abroad for one continuous year within the prior three years; the initial stay is generally up to 3 years, with a 7-year maximum.

H-1B cost status, as of October 2026. USCIS says a September 19, 2025 proclamation required an extra $100,000 payment for certain H-1B petitions filed on or after September 21, 2025, and that on June 8, 2026 a federal district court in Massachusetts vacated the agency guidance implementing it; DHS says it is complying while it considers next steps. A separate final rule effective September 9, 2026 requires "covered" employers (50 or more U.S. employees, over half in H-1B or L-1 status) to pay the 9-11 Biometric Fee on H-1B and L-1 petitions.

International labor standards. The Department of Labor's Bureau of International Labor Affairs (ILAB) maintains the Executive Order 13126 list of products it has a reasonable basis to believe are made with forced or indentured child labor; as of September 5, 2024 it listed 33 products from 25 countries, and ILAB says federal contractors supplying listed products must certify a good faith effort to determine whether such labor was used.

FAQ: Does U.S. overtime law apply to an employee working in London? Not for a workweek whose services are performed in a foreign workplace (29 U.S.C. 213(f)). Is a Japanese employee on a temporary U.S. assignment exempt from FICA? It depends on the agreement's coverage rules; Japan's has been in force since October 1, 2005, and an exempt worker proves it with a certificate from the country that keeps covering the worker. Do U.S. EEO laws protect a French citizen hired by our Paris subsidiary? The EEOC says non-U.S. citizens employed outside the U.S. are not protected. What does the BLS foreign-born figure include? U.S. residents who were not U.S. citizens at birth; the survey does not separately identify immigrants, refugees, temporary workers or undocumented people, and missing October 2025 data make 2025 figures not strictly comparable with earlier labor force estimates.

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