Glossary

#

13th Month Salary 13th-month salary is an extra month's pay on top of annual salary, usually paid in December. 14th-month salary 14th-month salary is a second additional month's pay on top of the 13th, typically split as summer and year-end instalments. 183-day rule 183-day rule is the treaty test that lets a short-stay employee remain taxed only at home.

A

A1 certificate A1 certificate is the EU form proving which country's social security system covers a person working across borders in the EU, EEA or Switzerland. Accident insurance (UVG) Accident insurance (UVG) is Switzerland's mandatory accident insurance: employers insure all employees for occupational accidents and illnesses (BU). Agency Workers Regulations (AWR) Agency Workers Regulations (AWR) give UK agency workers day-one rights (access to facilities and vacancies) and, after 12 weeks in the same role, equal basic pay. AHV/AVS (Swiss state pension) AHV/AVS (Swiss state pension) is Switzerland's first-pillar state insurance covering old age, survivors and disability (with IV/AI and EO/APG attached). Annual leave Annual leave is paid holiday entitlement: the EU floor is four weeks, with many countries above it.

B

B permit (Switzerland) B permit (Switzerland) is Switzerland's residence permit for stays over a year: EU/EFTA employees receive five-year B permits against open-ended or 12-month+. Background check Background check is pre-employment verification of a candidate's history — identity, education, employment, and where lawful, criminal or credit records. Benefits in kind Benefits in kind are non-cash compensation — company cars, housing, private medical cover, equity perks. Branch vs subsidiary Branch vs subsidiary is the core structural choice for foreign presence: a branch is an extension of the parent (no separate legal personality. Business process outsourcing (BPO) Business process outsourcing (BPO) is contracting entire business functions. Business visa Business visa permits entry for business activities — meetings, negotiations, conferences, training — but not productive work. BVG/LPP (Swiss occupational pension) BVG/LPP (Swiss occupational pension) is Switzerland's mandatory occupational pension (second pillar).

C

Chain liability Chain liability (supply-chain liability) makes companies liable for wage, tax or social-security failures of their subcontractors and labour suppliers. Co-employment Co-employment is the situation where two organisations simultaneously hold employer-type responsibilities for the same worker Collective bargaining agreement (CBA) Collective bargaining agreement (CBA) is a contract between employers (or their associations) and trade unions setting pay and conditions for a group of workers. Construction Industry Scheme (CIS) Construction Industry Scheme (CIS) is the UK's tax deduction regime for construction. Contingent workforce Contingent workforce is the non-permanent part of a company's workforce: independent contractors, agency temps, freelancers, consultants on statements of work. Contractor management Contractor management is the end-to-end administration of independent contractors. Contractor of Record (COR) Contractor of Record (COR) is a third party that formally engages independent contractors on a company's behalf. CPF (Central Provident Fund) CPF (Central Provident Fund) is Singapore's mandatory savings scheme for citizens and permanent residents.

D

Daily sickness allowance (KTG) Daily sickness allowance (KTG) (Krankentaggeld) is Swiss insured sick pay. Data processing agreement (DPA) Data processing agreement (DPA) is the mandatory contract (GDPR Article 28) between a controller and any processor handling personal data on its behalf. Deemed employment Deemed employment is the legal conclusion that a person engaged as a contractor must be treated as an employee — for tax, social security or employment rights. Digital nomad visa Digital nomad visa is a residence permit for people who work remotely for employers or clients outside the host country. Double taxation treaty Double taxation treaty (DTT, or double tax agreement) is a bilateral treaty that allocates taxing rights between two countries so the same income is not fully taxed twice.

E

Emiratisation Emiratisation is the UAE's programme requiring private-sector employers to hire Emirati nationals. Employee cost calculator Employee cost calculator is a tool estimating the total cost of employing someone in a given country. Employee stock options (ESOP) Employee stock options (ESOP) grant employees the right to buy shares at a fixed price after vesting — the standard startup retention tool. Employer costs Employer costs are everything an employer pays on top of gross salary: social security contributions, pension funding, insurances, statutory bonuses and levies. Employment contract Employment contract is the agreement establishing the employment relationship: role, pay, hours, notice and the terms local law forces in. Employment Pass (Singapore) Employment Pass (Singapore) is Singapore's work pass for foreign professionals. End-of-service gratuity End-of-service gratuity is the statutory lump sum Gulf employers owe departing expatriate employees, calculated from final basic salary and years of service. Entity setup Entity setup is establishing your own legal presence in a country — typically a subsidiary — to employ staff, contract locally and book revenue. EPF (Employees Provident Fund) EPF (Employees Provident Fund) is Malaysia's mandatory retirement savings scheme: employers contribute 12–13% of wages and employees 11% (statutory baselines). EU Blue Card EU Blue Card is the EU's residence-and-work permit for highly qualified third-country nationals, issued under Directive (EU) 2021/1883. EU Working Time Directive EU Working Time Directive sets the EU floor for working time: a 48-hour average week (over reference periods), 11 hours' daily rest, a weekly rest day. Expatriate (expat) Expatriate (expat) is an employee working outside their home country — classically on employer-initiated assignments with expat packages. Expense reimbursement Expense reimbursement is repayment of costs employees incur for work — travel, equipment, client entertainment — against receipts or approved scales.

F

False self-employment False self-employment — Scheinselbständigkeit in German — is disguised employment. Fixed-term contract Fixed-term contract is employment for a defined period or project. Freelancer Freelancer is a self-employed professional selling services to multiple clients, typically short engagements billed by project or day. Fringe benefits Fringe benefits are supplementary perks beyond salary — meal vouchers, transport support, wellness budgets, extra insurance, stock plans. Full-time equivalent (FTE) Full-time equivalent (FTE) expresses workforce size in full-time units: two half-time employees are 1.0 FTE.

G

G permit (cross-border commuter) G permit (cross-border commuter) is Switzerland's cross-border commuter permit: EU/EFTA residents of border regions work in Switzerland. Garden leave Garden leave is keeping an employee employed and paid through their notice period while excluding them from work. GDPR in employment GDPR in employment governs how employers process employee data: lawful bases beyond consent. Global expansion Global expansion is extending operations into new countries — and in the current playbook it usually starts with people, not premises: a sales lead or delivery team. Global mobility Global mobility is the discipline of moving people across borders for work. Golden visa Golden visa is residence granted for investment — real estate, funds, business or deposits. Gross salary Gross salary is pay before any deductions: base salary plus contractual extras such as bonuses, allowances and overtime, as stated in the employment contract. Gross-up Gross-up is increasing a payment so the recipient nets a promised amount after taxes: the employer bears the tax on top.

H

Holiday allowance (vakantiegeld) Holiday allowance (vakantiegeld) is a statutory extra payment for holidays — in the Netherlands, a mandatory 8% of annual gross salary (vakantiegeld), accrued monthly. Hypothetical tax (hypo tax) Hypothetical tax (hypo tax) is the notional home-country tax withheld from a tax-equalised assignee's pay: the amount they would have paid had they stayed home.

I

IBAN IBAN (International Bank Account Number) is the standardised account identifier used across Europe, the Middle East and beyond — a country code, check digits. ICT permit (intra-corporate transfer) ICT permit (intra-corporate transfer) is the EU permit for intra-corporate transferees: managers, specialists and trainee employees moved from a group company outside. Independent contractor Independent contractor is a self-employed person who provides services to clients under a commercial contract. Intellectual property assignment Intellectual property assignment is the transfer of rights in work product to the engaging company. Iqama (Saudi residence permit) Iqama (Saudi residence permit) is Saudi Arabia's residence permit for foreign workers, sponsored by the employer and rene wed annually against levies. IR35 (off-payroll working rules) IR35 (off-payroll working rules) are the UK's off-payroll working rules.

L

L permit (Switzerland) L permit (Switzerland) is Switzerland's short-term residence permit for stays of three to twelve months, tied to a specific employer and role. Labour leasing Labour leasing — known as Arbeitnehmerüberlassung in Germany and Personalverleih in Switzerland. Labour market test Labour market test is the requirement to show no suitable local (or priority-market) candidate exists before a work permit is granted.

M

Managed Service Provider (MSP) Managed Service Provider (MSP) in workforce terms is a company that runs a client's entire contingent-workforce programme. Maternity leave Maternity leave is protected leave around childbirth: durations run from the ILO's 14-week floor (Switzerland: 14 weeks at 80% via EO) through the UK's 52 weeks. Minimum wage Minimum wage is the lowest lawful pay for work, set by statute, collective agreement or both. MPF (Mandatory Provident Fund) MPF (Mandatory Provident Fund) is Hong Kong's mandatory pension scheme. Multi-currency payroll Multi-currency payroll is running salary payments in more than one currency across a workforce — or, for one employee, splitting pay between currencies.

N

National Insurance contributions (NIC) National Insurance contributions (NIC) are the UK's social security contributions: employees pay Class 1 NIC above a primary threshold, employers pay secondary Class 1. Net pay (take-home pay) Net pay (take-home pay) is what lands in the employee's bank account after income tax, social contributions and other deductions are withheld from gross salary. Non-compete clause Non-compete clause restricts an employee from competing after leaving — within limits courts police closely. Notice period Notice period is the advance warning employer or employee must give before ending an employment relationship.

O

Occupational pension scheme Occupational pension scheme is employer-linked retirement provision atop state pensions. Offboarding Offboarding is the controlled end of employment: notice handling, final pay with accrued leave and pro-rated extras, deregistrations, certificates and references. Offshoring vs nearshoring Offshoring vs nearshoring describe moving work to lower-cost locations. Onboarding Onboarding is everything between offer acceptance and a productive employee: contract signature, right-to-work and background checks, payroll and social-insurance. Overtime pay Overtime pay is compensation for hours beyond contractual or statutory working time, typically at premium rates (125–200%) or compensating time off.

P

Parental leave Parental leave is longer child-raising leave beyond maternity/paternity. Paternity leave Paternity leave is leave for fathers or second parents around birth. PAYE (Pay As You Earn) PAYE (Pay As You Earn) is the UK and Irish system of withholding income tax (and UK National Insurance) from wages through payroll. Payroll Payroll is the process of calculating and paying employee compensation: gross pay, deductions for tax and social contributions, net payment, payslips and filings. Payroll cycle Payroll cycle is the recurring schedule of pay: frequency (monthly, semi-monthly, bi-weekly, weekly), the cut-off date for inputs. Payroll deductions Payroll deductions are amounts withheld from gross pay before the employee is paid. Payroll tax Payroll tax is tax levied on wages: in strict usage, employer-side levies calculated on the wage bill (training levies, social funds). Payrolling Payrolling is an arrangement where a licensed provider formally employs workers that a client company has selected, and runs their payroll, contracts and insurances, while the client directs the daily work. Payslip Payslip is the statement employees receive each pay period showing gross pay, itemised deductions and net payment. Per diem Per diem is a fixed daily allowance covering meals and incidentals on business travel, replacing itemised expense claims. Permanent contract (CDI) Permanent contract (CDI) (CDI in France — contrat à durée indéterminée) is open-ended employment, the legal default across Europe. Permanent establishment (PE) risk Permanent establishment (PE) risk is the danger that a company's activity in a foreign country. Personal service company (PSC) Personal service company (PSC) is a limited company through which an individual sells their own services. Posted worker Posted worker is an employee sent by their employer to work temporarily in another EU or EEA member state while remaining employed in the home country. Private health insurance (employees) Private health insurance (employees) covers medical costs beyond or instead of state systems: mandatory employer-provided in the UAE (Dubai/Abu Dhabi mandates). Probation period Probation period is the initial phase of employment with eased exit rules: shortened notice and reduced dismissal protection while both sides test the fit. Public holidays Public holidays are statutory non-working days — from 8–9 in the Netherlands and the UK to 13+ in parts of Switzerland (cantonal), Austria and Asia.

Q

Quellensteuer (Swiss source tax) Quellensteuer (Swiss source tax) is Switzerland's tax-at-source regime.

R

Redundancy Redundancy is dismissal for economic or organisational reasons — the role disappears, not the person's performance. Relocation package Relocation package is the support bundle for a moving employee: transport of household goods, temporary housing, travel, settling-in services. Remote work policy Remote work policy is the ruleset governing where and how employees may work away from the office — including the consequential part: cross-border remote work. Residence permit Residence permit is the authorisation to live in a country for a defined period and purpose. Right to disconnect Right to disconnect is the employee's protected freedom not to engage with work communications outside working hours. Right-to-work check Right-to-work check is the employer's verification that a person is legally allowed to work in the country before employment starts.

S

Salary benchmarking Salary benchmarking is comparing pay for a role against market data — by country, sector, seniority and location — to set competitive and compliant offers. Schengen 90/180 rule Schengen 90/180 rule limits visa-free (and short-stay visa) presence in the Schengen area to 90 days within any rolling 180-day window. Secondment Secondment is the temporary transfer of an employee to another organisation — a group company, client or partner — while the home employment continues. SEPA payments SEPA payments are euro credit transfers and direct debits within the Single Euro Payments Area — 36+ European countries on one scheme, one format (ISO 20022). Severance pay Severance pay is compensation owed to an employee on termination, separate from notice. Shadow payroll Shadow payroll is a mirror payroll run in a host country for an employee who remains paid from home. Sick leave Sick leave is absence for illness with income protection: models range from employer-paid weeks. Skilled Worker visa (UK) Skilled Worker visa (UK) is the UK's main sponsored work route: a licensed employer sponsors a role meeting skill and salary thresholds. Social insurance in China Social insurance in China comprises the 'five insurances and one fund': pension, medical, unemployment, work injury and maternity insurance plus the housing fund. Social security contributions Social security contributions are mandatory payments funding state pensions, healthcare, unemployment and related insurance. Split payroll Split payroll pays one employee's salary through two countries' payrolls — part at home, part in the host country — usually during long assignments. Sponsor licence (UK) Sponsor licence (UK) is the Home Office authorisation UK employers need to sponsor most work visas (Skilled Worker, Global Business Mobility). Staffing agency Staffing agency is a firm that finds and supplies workers to client companies — either recruiting them for direct hire or supplying temporary staff it employs itself. Statement of Work (SOW) Statement of Work (SOW) is a contract defining a specific deliverable, timeline and price for services — the vehicle for genuine outcome-based consulting. Statutory Maternity Pay (SMP) Statutory maternity pay in 2026: £194.32 a week for up to 33 weeks after six weeks at 90% of earnings. See who qualifies and how employers run SMP.

T

Tax equalisation Tax equalisation is an assignment policy keeping the employee's tax burden at home-country level: the employer deducts a hypothetical home tax from pay. Tax identification number (TIN) Tax identification number (TIN) is the identifier a tax authority assigns to a person or company — the key payroll and filings run on. Tax residency Tax residency is the status that determines which country taxes a person's worldwide income. Termination of employment Termination of employment is ending the employment relationship — by dismissal, resignation, expiry or agreement. Totalisation agreement Totalisation agreement is a bilateral social-security treaty preventing double contributions and protecting benefit rights for cross-border workers. TUPE (transfer of undertakings) TUPE (transfer of undertakings) — the UK's TUPE and the EU's Acquired Rights Directive .

U

Unfair dismissal Unfair dismissal is dismissal without lawful reason or fair process, giving the employee claims for compensation or reinstatement.

V

Vendor Management System (VMS) Vendor Management System (VMS) is the software platform on which contingent-workforce programmes run.

W

Wage Protection System (WPS) Wage Protection System (WPS) is the mandatory electronic salary-transfer mechanism used in the UAE and other Gulf states. Work permit Work permit is the official authorisation a foreign national needs to take up employment in a country. Work permit quota Work permit quota is a numerical cap on permits for foreign workers: Switzerland's federal quotas for non-EU nationals (8,500 for 2026, plus 3,500 for UK nationals). Work visa Work visa is the entry document that allows a foreign national to travel to a country for employment. Works council Works council is an elected employee-representation body with legal information, consultation and — in Germany and the Netherlands — co-determination rights.

Z

Z visa (China work visa) Z visa (China work visa) is China's entry visa for employment — one step in a chain. Zero-hour contract Zero-hour contract is employment with no guaranteed hours — work offered and accepted shift by shift.