In these FAQs the company which wishes to second out an employee is known as the "employer". The company wishing to take the employee on secondment is known as the "host". The employee being seconded is known as the "secondee"
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Practical matters
1. How long does a secondment last?
This is a matter for the employer and the host company to agree between them, though TIGA envisages that secondments will typically not be longer than 6 months.
2. Is the agreement to second a named individual or to provide a service?
An individual should be named on the business to business secondment agreement.
3. Would the work be carried out in out the employer's studio or the other company's studio?
This can be agreed between the two companies. There may be circumstances where one location is preferable to the other. It might also be beneficial for the employee to spend some time at one location and some in another.
4. How would the host company deal with disputes or cases where the work carried out by the secondee is not of the standard required?
The host can terminate the secondment at any time by giving the agreed length of notice. The companies involved are free to agree a trial period during which a shorter period of notice can be given to terminate the arrangement.
Ideally the host company will want some kind of comfort that the secondee has the appropriate skills and ability before commencing the secondment.
If the issue arises because the secondee has committed a disciplinary offence the host company should immediately inform the employer as it remains the employer's responsibility to address disciplinary issues.
5. If the host company terminates the secondment because the secondee is unsuitable, is the employer obliged to second another of its employees to it?
No. There is no obligation on the employer to second a substitute secondee.
6. Will the secondee be able to take holiday whilst on secondment?
The secondee will continue to be entitled to take holiday during the secondment, subject to the employer's usual legal rights to specify when the secondee can or can not take holiday. The employer will continue to pay the secondee during holiday as usual.
The employer would be expected to consult the host company before approving any holiday request made by the secondee. The host company will be expected to pay the employer only in respect of a pro rata amount of holiday taken by the secondee during the secondment. For example, if the secondee's annual holiday entitlement is 20 days and the secondment is 6 months, it will be reasonable for the secondee to take 10 days during the secondment and for the host company to pay the employer in respect of this.
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IP / Commercial / Security matters
7. Who will own the IP created by the employee during his secondment?
Normally, by law the employer will own any IP created by its employee. However, the sample secondment agreement contains provisions that make sure any IP created by the employee during the course of his secondment are owned by the host company.
Any IP created before or after the secondment will continue to be owned by his employer.
8. How can we be certain that the secondee will not steal our confidential information?
Every business needs to protect its confidential and proprietary information. During the course of a secondment to your business, the secondee will undoubtedly have access to your confidential information for the purpose of fulfilling its duties. The risk that a secondee will steal or otherwise make unauthorised disclosures of your confidential information is no greater or less than the risk that a new employee you have hired may do the same.
To provide you with contractual protection against this risk, TIGA has prepared a sample non-disclosure agreement for secondees to sign with their host company. This non-disclosure agreement protects confidential information disclosed to the employee both during the secondment and also any confidential information disclosed to the secondee during any pre-secondment discussions. At the end of the secondment, the secondee is required to return all confidential materials in his possession back to the host company.
A secondee who steals or makes unauthorised disclosures of your confidential information will be in breach of this non-disclosure agreement. Where this happens, you may be able to sue for damages and/or seek an injunction to protect against further harm to your confidential information.
As a separate comfort, the sample business to business secondment agreement that you sign with the secondee's employer also carries confidentiality protections. This protects you in the event that a competitor seconds its employees to you and then makes unauthorised use of confidential information to which they have access during their secondment.
9. What if the secondee works remotely from its employer's studio? How do I know its employer won't misuse our confidential information?
As explained above, the employer will be required to enter a business to business secondment agreement with you that will require it to maintain the confidentiality of your confidential information and materials. Once the secondment ends, the employer is required to remove all confidential information and materials relating to your business from its machines.
However, some employers may make backups of information held on their computers for genuine security purposes, and this could include your confidential information where the secondee has access to this remotely. It will often be impracticable for employers to prevent backup of your confidential information or to remove your confidential information where this has been backed up (particularly for offsite or tape backups). In these limited cases, the sample business to business secondment agreement does not require employers to remove your confidential information, but they must agree not use to it for any purpose whatsoever.
10. Who is responsible for providing the secondee with development tools, equipment and licences?
The sample business to business secondment agreement envisages that the company where the employee will be located during the secondment will be responsible for providing the secondee with all development tools, equipment and licences it requires to perform its responsibilities. However, the contract is only a template and the host and the employer are free to agree otherwise. Where this is the case, the host and the employer will need to agree appropriate changes to the template to reflect this.
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Poaching
11. We don't want to lose our staff. What protection do we have against the seconded employee going to work for the other company permanently?
All companies participating in this scheme have a legitimate interest in protecting their workforces. For the scheme to work effectively everybody must participate in good faith and employers must have confidence that the host companies will be deterred from poaching their employees. The sample business to business secondment agreement envisages that a fee of 35% of the secondee's current salary should be paid to the employer by way of compensation in the event that the host employer induces the secondee to leave their employment with their employer to work for the host company. The secondee's current salary will be set out in the sample business to business secondment agreement so there will be no debate as to what the secondee's salary actually is. Companies are free to agree between them that a different level of fee, or none at all, should be payable.
12. What if individuals not currently employed want to offer their services to a games company? Perhaps they’ve been laid off from a games company etc.?
Industry Sharing is solely for games companies to ‘loan’ staff to other games companies to ease workflow peaks and troughs. TIGA suggest such individuals approach the games companies directly. The Industry Sharing contract and terms are not suitable for that scenario.
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Financial matters
13. Which company will pay the secondee's salary and provide the secondee's benefits?
The employer will continue to pay the secondees's salary and deduct tax and national insurance as normal and provide all benefits as usual, including pension and sick pay.
14. What payment will we receive for seconding out our employees?
The purpose of industry sharing is to help developers cope with pockets of under or over capacity. Whilst it might be tempting to take the opportunity of seconding out one of your employees to another company to make a small profit, the expectation is that companies will only charge the direct costs of employing that individual i.e. salary, national insurance, pension contributions and the cost of benefits.
15. What if during the course of “secondment” the ‘secondee’ is due a pay review and receives a pay rise? This does not change the agreed contract rate between the two businesses.
16. How can the host company be sure the salary stated on the business to business secondment agreement is correct?
By signing the sample business to business secondment agreement the employer will be confirming that all details provided by it and set out in the sample business to business secondment agreement are true and accurate. The host company is required to keep salary and remuneration details confidential.
17. Who would pay for software licenses if the company where the secondee works doesn't have the relevant software packages?
It is the host company's responsibility for ensuring that the secondee has access to the relevant licenced software packages.
18. Which company is responsible for paying expenses if the employee needs to visit the secondment studio?
The general principle is that the host company should be responsible for the expenses associated with that. In practice it might be easier for the employer to reimburse the employee through payroll than it would be for the host to do so, but the host company would be expected to reimburse the employer. Games companies are encouraged to agree appropriate levels of expenses before those expenses are incurred by the secondee.
19. How will invoicing work?
Companies should agree between them at what intervals invoices will be raised. Much will depend on the expected length of the secondment. Companies should also agree when the payment should be made. It may be beneficial from the employer's perspective to receive payment before payroll is processed.
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HR matters
20. Would the employer still be able to make redundancies even though there may be a possibility of a secondment?
Before making redundancies it is good practice for an employer to consider ways in which it can avoid making redundancies. That might include considering whether an employee can be seconded out. However, there may be very good business or financial reasons why seconding out an employee does not make sense for the employer at a particular time. Since the "play together" initiative is an entirely voluntary arrangement, TIGA believes participating companies should not be required to second an employee where it is not in their best interests to do so.
21. Would the employer need to make existing employees and new recruits aware that there it is participating in the "play together" scheme?
This is a matter for each employer, but employers are likely to find their employees are more willing to go on secondment if they have prior knowledge of the possibility.
22. How much freedom should an employee have to refuse a secondment?
The employer should always consult its employees about the prospect of being seconded out and seek their agreement to doing so.
23. Do employers need to make any variations to the secondee's contract of employment with them?
A change to the contract of employment shouldn't be necessary, but the employer will in any case want to confirm in writing the secondment arrangements to the secondee.
24. Which company will deal with disciplinary, poor performance and grievance issues?
The employer will continue to be responsible for dealing with all of these issues, though the host company may be expected to cooperate with the employer in resolving the issue. If an issue also involves the host company's own staff (for example, an allegation of sexual harassment by the host's employee), the host company would be expected to investigate the matter in the usual way.
25. How would a secondment be affected by a secondee going on maternity leave or paternity leave?
Secondees will retain their employment rights and so will be able to take maternity leave or paternity leave or any other form of "family friendly" leave. In practice, many employees would not want to be on secondment during leave and the host company would not want to pay the employer for the secondee's time if he or she would not be performing work for them. It is therefore recommended that the employer discusses personal circumstances with individuals when considering whether to second that individual. Employers should be aware, however, that treating an employee less favourably because they will be taking statutory leave could be deemed to be discrimination.
If the secondee is pregnant the employer will want to be certain that the host company is providing a suitable working environment for her. Similarly, the host company may also be required to conduct a risk assessment under health and safety legislation. The secondee will be entitled to take a reasonable amount of time off from working at the host company to attend ante natal appointments.
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Ending the secondment
26. What would happen if the employer needs to pull the secondee back for any reason?
It is suggested that a two week notice period from either the employer or the host company should be given to terminate the secondment for any reason, though both companies can agree a shorter or longer period. It may be appropriate, for example, for the notice period during the first week to be just a day or two so that either company can end the secondment if circumstances change unexpectedly.
Both companies should bear in mind that the secondee may also want to give notice to terminate the secondment. To avoid requiring the secondee to remain on secondment beyond his notice period, the notice either company needs to give to the other should be shorter than the notice period the secondee is required to give to terminate the secondment.
27. What happens to the secondee if the host company is sold?
Since the secondee remains the employer's employee at all times, the secondee will not become an employee of the purchaser of the host company. The purchaser of the host company or the employer may wish to continue or terminate the secondment and the appropriate notice period should be given.