Your Rights When Working for Multinational Employers

Maybe you’re considering a work transfer outside the United States. Or perhaps you already work in another country and have noticed that sexual harassment seems to be part of the work culture. You know that we have laws in the U.S. that prohibit employment discrimination. But do those protections help you in a foreign nation? Or with a foreign company here? Oftentimes they do. But the definitive answer will depend on a few factors.

If you suspect you may be experiencing workplace discrimination or another employment issue here or abroad, it’s best to consult an experienced employment attorney. They can help you navigate the various laws involved so you can determine the best way to proceed.

In this article, we’ll explore the reach of U.S. workplace discrimination and other laws to multinational companies. Let’s begin by ensuring we understand what employment discrimination is.

What Is Employment Discrimination?

Employment discrimination is the unfair treatment of an employee or job applicant because of their protected characteristics. We also sometimes refer to it as "workplace discrimination." It can occur in any aspect of the employment relationship. This may include employment decisions or actions concerning:

• Recruitment
• Hiring
• Work environment
• Termination of employment
• Layoffs
• Conditions of employment
• Compensation

Protected characteristics are defined by law. So, let’s take a look at our federal laws prohibiting this unfair treatment.

EEO Laws

The United States has Equal Employment Opportunity (EEO) laws. These federal labor laws are designed to prevent workplace discrimination. The main EEO anti-discrimination laws include:

• Title VII of the Civil Rights Act of 1964 (Title VII): Prohibits discrimination based on race, color, religion, sex, and national origin. The Supreme Court has interpreted “sex discrimination" under Title VII to also include discrimination based on pregnancy, gender, gender identity, and sexual orientation.
• Age Discrimination in Employment Act of 1967 (ADEA): Protects individuals who are 40 years of age or older from age discrimination.
• Americans with Disabilities Act (ADA) of 1990: Bans discrimination against qualified individuals with disabilities
• Equal Pay Act of 1963 (EPA): Requires equal pay for equal work, regardless of sex/gender

Together, these laws prohibit employment discrimination targeting the following protected characteristics:

• Race
• Color
• Religion
• Sex/gender
• National origin
• Pregnancy
• Gender identity
• Sexual orientation
• Age
• Disability

It’s important to note that these laws ban all forms of employment discrimination. This includes harassment and retaliation.

Harassment

Harassment is a form of discrimination. It involves unwelcome conduct based on protected characteristics.

Retaliation

Retaliation is also a form of discrimination. It occurs when an employer punishes an employee for engaging in protected activities. Protected activities involve an exercise of employee rights under EEO laws. 

For example, filing a discrimination complaint is a protected activity against which employers may not retaliate.

Which Employers Must Comply With EEO Laws?

While there are limited exemptions for some small businesses and religious organizations, most employers in the U.S. must comply with EEO laws. Specific requirements for compliance can vary depending on the law and the size of the organization.

The Equal Employment Opportunity Commission (EEOC) is the federal agency responsible for enforcing EEO laws.

Multinational Employers

Before we examine whether EEO laws apply to multinational companies, let’s make sure we understand what these are.

A multinational employer is generally a company that operates in multiple countries around the world. These companies have offices, factories, or stores in different nations. This allows them to sell products or provide services globally. 

For example, big companies like Apple, Google, and Toyota are multinational employers because they have branches in many countries.

Do U.S. EEO Laws Apply to Foreign Multinational Employers?

EEO laws primarily apply to employers located in the United States and its territories.

This means the U.S. locations of foreign multinational companies must generally comply with EEO laws. For example, EEO laws would protect a gay Bolivian engineer at a German company’s Atlanta office from workplace discrimination. The German company’s U.S. operations would also need to comply with these laws’ affirmative obligations.

These might include:

• Providing reasonable accommodations for employees with disabilities
• Taking steps to prevent workplace harassment
• Posting on-site notices about U.S. EEO laws

However, the general rule that a foreign company’s U.S. operations must follow EEO laws is subject to one narrow exception.

Friendship, Commerce, and Navigation Treaty Exception

If an international treaty or agreement permits a foreign employer in the U.S. to prefer its own nationals for certain positions, the Friendship, Commerce, and Navigation (FCN) treaty exception applies.

For example, an agreement between the U.S. and Japan might allow Japan-based Sony to only hire Japanese citizens for executive roles in its Chicago offices. This type of preferential hiring would normally violate EEO laws. But the FCN treaty exception allows it. 

The exception doesn’t broadly exempt a company’s U.S. operations from all EEO laws. Rather, it’s limited to the specific provisions outlined in the treaty or agreement.

Do EEO Laws Protect U.S. Citizens Working Abroad?

The answer to this question depends on the employer.

Generally, U.S. multinational employers must comply with EEO laws for their U.S. citizen employees working abroad. U.S. multinational employers include those based or incorporated here. For example, U.S. EEO laws protect U.S. citizen employees working in the Barcelona office of a Boston-based company.

However, this general rule is subject to one exception.

Foreign Laws Defense

If adhering to an EEO law abroad would cause an employer to violate the local laws of the country where the workplace is located, the foreign laws defense exempts the employer from compliance with that EEO law. The employer must still follow the EEO laws that don’t conflict with the foreign country’s laws.

Foreign Employers Abroad

As a general rule, EEO laws also protect U.S. citizens working abroad for foreign employers who have sufficient connections with the U.S. and those controlled by U.S. companies.

Multiple factors help determine whether there are sufficient connections with the U.S. They include:

• Employer’s principal place of business: The primary location where the employer’s factories, offices, and other facilities are situated
• Nationality of employer’s dominant shareholders: The nationality of those who hold the majority of shares or have voting control
• Nationality and location of employer’s management: The nationality and location of the company’s officers and directors

Applying these factors, a Korean automotive company with operations in Australia and Canada, but owned by a U.S. corporation with American shareholders and management, would be subject to U.S. EEO laws for its U.S. citizen employees.

The factors for determining control by a U.S. company are a bit more nuanced. They include:

• Interrelated operations: The degree to which the operations of the U.S. company and the employer are interconnected
• Common management: Whether there is shared management between the U.S. company and the employer
• Centralized control of labor relations: The extent to which labor relations are controlled centrally by the U.S. company
• Common ownership or financial control: Whether there is shared ownership or financial control between the U.S. company and the employer

Keeping these factors in mind, a French toy company operating in France and China, but managed and financially controlled by a U.S. corporation, would be subject to U.S. EEO laws for any U.S. citizen employees.

So, if a foreign company satisfies the criteria for either sufficient connections or control, it must generally comply with EEO laws to protect its U.S. citizen employees working overseas.

As with U.S. employers abroad, the foreign laws defense may exempt a foreign employer from compliance with certain EEO laws.

Do EEO Laws Protect Non-U.S. Citizens Working Abroad?

No. U.S. EEO laws don’t protect non-U.S. citizens unless they’re working within the U.S. and its territories.

Other Federal Employment Laws

Aside from EEO laws, U.S. multinational companies operating abroad generally have to follow local employment laws of the country where their employees are working. Likewise, foreign employers in the U.S. must comply with additional employment laws. 

Like EEO laws, foreign companies must comply with other U.S. employment laws for all their employees working here, regardless of citizenship.

These laws often pertain to certain employee benefits and protections. For example:

• Occupational Safety and Health Act (OSHA): Ensures safe and healthful working conditions by setting and enforcing standards and providing training, outreach, education, and assistance
• Family and Medical Leave Act(FMLA): Provides eligible employees with up to 12 weeks of job-protected unpaid leave per year for certain family/medical reasons
• Internal Revenue Code: Mandates employer contributions to Social Security and Medicare for all employees
• Federal Trade Commission (FTC) Act: Requires employers here to protect employee personal data from breaches and unauthorized access
• Fair Labor Standards Act (FLSA): Sets standards for minimum wage, overtime pay, recordkeeping, and child labor

However, the FLSA has one narrow foreign exemption provision. It applies to employees who spend their entire workweek in foreign countries or territories under U.S. jurisdiction. This means the FLSA’s minimum wage, overtime, and child labor rules don’t apply to these employees. However, this exemption doesn’t apply to employees working in Puerto Rico, the U.S. Virgin Islands, or the states, including Washington, D.C.

State Employment Laws

Foreign employers’ operations here must also comply with applicable state and local employment laws. These can vary significantly by locale. They often include additional protections or requirements for employees.

Workers’ Compensation

For example, state law primarily governs workers’ compensation rules. Each state has its own workers’ compensation system, which provides wage replacement and healthcare benefits to employees injured on the job. Foreign multinational employers operating in the U.S. must comply with the specific workers’ compensation laws and regulations of the state in which they operate.

Paid Sick Leave

Federal law doesn’t generally require paid sick leave. However, as of 2025, 18 states, including New York, do. This means foreign companies operating in those states must provide paid sick leave to employees who meet the eligibility criteria.

Employment Contracts

Both federal and state law govern employment contracts between a foreign employer with operations here and its U.S. employees. 

For example, non-compete clauses in these employment agreements must comply with federal antitrust laws and state-specific regulations. 

State laws in this area vary significantly in terms of enforceability and restrictions. California, for one, has implemented a full ban on non-compete agreements.

Getting Legal Advice

Needless to say, the laws governing your particular employment issue will likely derive from multiple jurisdictions. So, understanding your employment rights at a multinational company can be rather confusing. They may depend on your citizenship, as well as the company’s structure and location. Often, state law also plays a critical role.

Regardless of the specific variables, you’ll want to touch base with an experienced employment attorney. They can help you understand your rights as an employee. These may be tricky to identify and navigate on your own. But connecting with a competent advisor through Findlaw’s directory of employment attorneys is easy. Just click on your state to see ratings and contact information for local experts. You can also narrow your search by city if you prefer.

Either way, enlist the help of a qualified attorney who can help you understand your options.