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Information Technology Outsorcing Transaction - Halvey K.J.

Halvey K.J. Information Technology Outsorcing Transaction - Wiley Publishing, 2005. - 649 p.
ISBN-10 0-471-45949-6
Download (direct link): informationoutsourcingtransactions2005.pdf
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employees in order to constitute an “automatic transfer” under the particular country’s employment/redundancy laws?
176 Ch. 4 Outsourcing Contract
12. Projects
о Identify any projects that Vendor will be responsible for implementing/managing as part of the transaction.
о Will Vendor be responsible for any reengineering in connection with its provision of services? If so, what are each party’s responsibilities? What are the consequences if the reengineering is not successful or performed by deadlines specified?
о What is the inter-relationship of Vendor’s reengineering responsibilities and Vendor’s other services responsibilities (e.g., are they cross-terminable)?
о Will Vendor be responsible for any new implementations? If so, what are each party’s responsibilities? What are the consequences if the reengineering is not successful or performed by deadlines specified?
о Which party will be responsible for purchase/license of third-party methodologies/technologies (if applicable)?
13. Integration
о How will the methodologies/technologies introduced by Vendor be integrated with other methodologies/technologies used by Customer?
о Have other Customer business areas been contacted for input (e.g., information systems, human resources)?
14. Transfer of Employees
о Determine whether any or all of Customer employees will be offered employment by, or transitioned to, Vendor or a Vendor subcontractor.
о Identify group of retained employees.
о Review Customer’s severance/redundancy policy, if any, to determine whether a transition to Vendor may invoke severance obligations. (If so, factor into Customer’s cost analysis.)
о Are there any claims with respect to any of the transitioned employees?
о Compare Customer and Vendor benefits. Are any adjustments necessary?
о Does Vendor require any special screening of employees (e.g., drug testing)?
о Will Vendor require transitioned employees to sign an employment agreement?
о Develop an employee communication plan.
о Determine whether any stay bonuses/incentives are necessary.
Appendix 4.2 Key Issues in Offshore Outsourcing Agreements 177
15. Project Staff
о Identify management structure of Vendor as well as Customer in connection with the provision/receipt of services.
о Are there any limitations/restrictions with respect to reassignment/ replacement of key Vendor personnel?
о Are there any on-site/off-site requirements?
о Are there any limitations/restrictions with respect to “churning” of
employees?
о How will Customer complaints regarding Vendor personnel be handled? о Are there any special clearances of Vendor personnel necessary?
о Are there any limitations/restrictions with respect to subcontractors?
о Are there any visa requirements?
о What are Vendor’s employment practices? Do they comply with
local law? Do they comply with U.S. law?
16. Retained Assets
о Identify which assets Vendor will manage and, of those assets, which assets Vendor will have financial responsibility for.
о Identify which assets Customer will continue to manage and, of
those assets, whether Vendor will have any financial responsibility.
о How will the parties act in the event it is not clear where a problem
originates from (e.g., root cause analysis)?
17. Agreements to be Reviewed
о Identify any third-party agreements/relationships that may be
impacted by the outsourcing, including:
• Maintenance agreements
• Subcontracting relationships
• Other service agreements
• Methodology/technology licenses
• Equipment/asset leases
• Real estate leases/subleases
о Are there any restrictions with respect to third-party management/
access or assignment to a third party?
о What are the terms relating to termination/renewal?
о What are the pricing terms, and will they be impacted by the
transaction?
о Develop a strategy for notifying third parties, if applicable.
178 Ch. 4 Outsourcing Contract
18. Third-Party Consents
о Are any third-party consents necessary in connection with the commencement of the transaction? If so, which party is responsible for obtaining such consents and how will financial responsibility be allocated?
о How will third-party consents be obtained upon the expiration/termination of the transaction (in order to transition agreements/assets back to Customer or Customer’s designee)? How will financial responsibility be allocated?
19. Performance Standards
о Identify those services that will have performance standards.
о How will Vendor’s performance be measured? Will existing performance standards be used or will performance standards be established on a going-forward basis?
о Identify any permitted downtime and testing.
о How will failures to meet performance standards be handled (e.g., liquidated damages or termination)?
о Will there be any procedures for assessing/determining causes of failures to meet performance standards (e.g., root cause analysis)?
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