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HR Assistance - Secondment
Secondment | Русский



Secondment is a temporary movement of an employee to another Russian or foreign organization. In a secondment arrangement, one company (the "Secondor") 'lends' an employee (the "Secondee") to another company (the "Client") in exchange for a fee. The Secondee remains under the employment of the Secondor during the whole period of secondment and does not become a formal employee of the Client, though he performs his duties in accord with the instructions and under the control of the latter. The Client makes payment for the provided workers and the Secondor pays wages to the Secondee during the whole period of secondment. (See The Scheme of Placement of the Holding Staff at Host Organizations).



HR Assistance offers you services of the organization of placement of the personnel in different companies (Secondment), including development of the schemes of secondment (considering tax and legal consequences of secondment) and organization of the secondment process itself. We have an opportunity of elaboration and development of secondment schemes both inside your holding company and on conditions of Outstaffing.


Studies held in a number of European countries by international consulting companies, as well as our experience of work with global and transnational companies show that for successful business under the conditions of access to foreign markets and development of international projects, an organization should have an opportunity to direct the necessary people to the necessary place operatively and with the least expenses, in other words to manage personnel movements effectively. All this can be achieved, having created a special organization, and having concentrated in it the so-called "mobile personnel".

Operational efficiency of movements of the mobile personnel, unified approaches in the work with it, application of various corporate programs, co-ordination of the system of career planning with remuneration system and systems of training and development, and also the organization of deductions in the Russian systems of obligatory social insurance can be most easily and effectively achieved under the conditions of hiring the mobile personnel within the limits of one organization.

This organization can also perform the functions of research of a competitive labor market in the countries of the Company presence meaning creation and duly adjustment of an effective system of remuneration of the mobile personnel.

Unlike the variant of hiring in a host country the system of secondment allows to supervise effectively the costs of maintenance of the mobile personnel, and the total costs of the corporation on such purposes, as a rule, essentially decrease, due to their concentration in one center of expenses.


Problems of a different level of taxation of the mobile personnel in Russia and in the countries to which it is directed can be effectively solved only with the use of the secondment scheme.
As a result of application of the method of tax flattening which is widely used by transnational companies, the mobile personnel directed to various countries has an opportunity to receive net-income in the same size as though it worked in Russia. In this case, the factor of a host country, and also the level of taxation in the concrete country should be certainly considered. So, for example, an employee directed for work to Bulgaria will have to pay the income tax under the rate of 29 %, however his counterpart in the Russian Federation will pay the income tax under the rate of 13 %. The method of tax flattening under which the seconding organization considers the difference of taxation in the host country when setting the amount of remuneration for the seconded employee, allows to create fair conditions for all seconded employees. In addition, the seconded employee will have no interest to understate his income when declaring it in a host country, which is also significant.


As was already mentioned above, direction of the personnel is carried out under the Agreement on provision of the personnel between the Seconding Company and the Client. Before the conclusion of the Agreement on provision of the personnel it is necessary to explore thoroughly the tax and legal consequences arising at the interface of the legislation of two countries as a result of the conclusion of the contract.

Agreements on provision of the personnel in the Russian Federation are regulated by the general provisions of the civil and labour legislation - there are no special rules regulating these contacts in our legislation. This circumstance can be regarded as positive as it gives the Seconding Company and the Client more freedom in establishing contract conditions of seconding an expert.

When seconding a citizen of the Russian Federation it is also important to consider the necessity of obtaining the work permit for the majority of European countries and in the USA. The obtainment of the permit to hire foreign workers is usually imposed on the Client.