Human Resource Interactions with Host, Parent & Third-Country Nationals

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  • 0:02 Employees Across the Globe
  • 1:21 Labor & Employee Relations
  • 2:42 Cultural Considerations
  • 4:38 Lesson Summary
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Lesson Transcript
Instructor: Shawn Grimsley

Shawn has a masters of public administration, JD, and a BA in political science.

Employee relations are guided by human resource (HR) management professionals, and the global environment makes doing this more complex. In this lesson, we'll see how HR professionals interact with employees across the globe.

Employees Across the Globe

Denise is a human resource (HR) specialist that works for a large multinational conglomerate. Her company is based in Seattle, Washington, in the United States. However, the company employs people from over a dozen different countries and cultures around the world. Denise interacts with three general types of employees: parent company nationals, host country nationals, and third-country nationals. Let's take a look at each type:

  • Denise works with Arnold. While Arnold is a citizen of the United States, he has taken an assignment with the company at its foreign subsidiary in Berlin, Germany. Arnold is considered a parent-national, also known as an expatriate. An expatriate is a citizen of a company's home country working abroad at one of the company's foreign subsidiaries.
  • Arnold works with Gunther in the Berlin office. Gunther is a citizen of Germany. He's considered a host country national, which is an employee that is a citizen of the country where a company's foreign subsidiary is located.
  • Adrienna works with Arnold and Gunther in Berlin. She's a citizen of Italy. She's considered a third-country national because she's an employee that is a citizen of one country, working in another country for a company headquartered in a third country.

Labor & Employee Relations

One of the key functions of human resource management is employee and labor relations. Employee relations is the official interaction between employees and management regarding the employer-employee relationship, including such things as work decisions, complaints, and conflict resolution. If employees are represented by a union, then the union is the employees' exclusive representative, and the company must work with the union on employee matters. This is known as labor relations.

Denise's job of managing employee and labor relations is made far more complex with a global workforce. Each country where a foreign subsidiary is located may subject her company to an entirely unique set of labor and employment laws. What may not be a discriminatory employment or labor practice in one location may expose the company to legal liability in another. Wage and hour laws will be different from country to country.

Some countries may have very strong labor unions, while other countries may have very weak labor unions or have no labor unions at all. Each country will have different laws relating to benefits, such as maternity leave. Of course, this can create issues of company-wide employee equity as some employees may be legally entitled to benefits and protections, while other employees are not.

Cultural Considerations

Culture is also an important issue for Denise. Not all cultures value the same things. Some cultures value individual achievement, while others value group effort. Some cultures may be more materialistic, valuing financial gain and acquisition of things. Other cultures value leisure activities more. Denise will have to contend with each different culture and determine not only what motivates the employees at each location but also try to maintain a sense of company-wide employee fairness.

Of course, working with expatriates is probably the easiest part of global employee relations, but it still may provide some challenges. Denise may face indirect clashes of culture as expatriates may have to adjust to cultural norms in the host country. For example, an expat salesman may be disappointed to find that the foreign subsidiary's incentive structure is geared towards team achievement rather than individual effort and initiative.

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