Document Type

Article

Disciplines

International Law

Abstract

As multi-national corporations expand1 and send employees to branches and subsidiaries throughout the world, the problem of which nation's employment law to apply in the courts of both the home and host country is becoming acute. Traditional notions of territoriality and international comity long have dictated a reluctance on the part of lawmakers to impose employment law beyond their own borders. Nonetheless, the tradition has begun to erode. While Congress exempts foreign corporations doing business in the United States from some employment laws through treaties,2 the courts apply the same laws to United States corporations whether or not they are operating within the United States. In these cases the place of employment no longer prescribes the law.

There are two major areas of inquiry concerning the choice of employment law for multinational corporations: a) the law applying to branches and domestically incorporated subsidiaries of foreign corporations for their operations in the United States; and b) the law applying to branches and foreign incorporated subsidiaries of United States corporations for their operations abroad.4 Under the territoriality principle, the United States has well-established authority to impose law on foreign corporations concerning their operations within its borders and frequently has exercised it.' United States imposition of law on United States corporations and subsidiaries abroad has originated much more recently, however.6 In extending its power to prescribe employment law beyond its own borders, the United States is partially replacing the principle of territoriality with that of nationality. The rationale is that any company operating abroad which is either a United States' national or is under the control of one is subject to specified United States laws. 7 The United States Supreme Court has concluded that "[t]he Law of Nations does not prevent a State from exercising jurisdiction over its subjects . . . abroad,"8 thus Congress has the power to apply United States employment laws to its corporations operating abroad.

The fact that Congress has the power does not mean it has exercised it and the sensitivity of foreign relations mandates that congressional legislation be presumed "to apply only within United States territorial jurisdiction" "unless a contrary intent appears." 9 For these reasons, careful attention to statutory language is vitally important in determining congressional intent. The scope of United States employment law in the international arena is a matter of statutory interpretation and international conflicts of law. This study explores the congressional intent and ramifications in applying Title VII of the Civil Rights Act of 1964,10 42 U.S.C. § 1981, and the Age Discrimination in Employment Act [ADEA]" to foreign corporations for their operations in the United States and to United States corporations for their operations abroad.

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