CAYMAN ISLANDS Law and Practice Contributed by: Daniel Lee, Sophia Scott, Kimberly Robinson and James Turner, Maples Group
out their functions of being a director, subject to certain exceptions (eg, liability resulting from their own actual fraud or wilful default). Com - panies may also include provisions in their arti - cles of association that exculpate directors from liability for negligence, default or breach of duty, except in cases of actual fraud or wilful default. Shareholder Liability Subject to any express provision in the articles of association of the company to the contrary, a shareholder does not owe any fiduciary duty to the company or to any other shareholder in exer - cising any rights or authorities, or performing any obligations under the articles of association. The liability of the shareholders of a company limited by shares is limited to the amount unpaid The concept “of piercing the corporate veil” is recognised in the Cayman Islands only in excep - tional circumstances, including, as example and without limitation, where a company’s separate legal personality has been used: • for an illegal or improper purpose; and • for the purposes of fraud. on the shares held by them. Piercing the Corporate Veil 4. Employment Law 4.1 Nature of Applicable Regulations The Labour Act (As Revised) establishes mini - mum employment standards but does not pre - clude an employer from setting terms and con - ditions above the minimum. It also establishes remedies for unfair dismissal and entitlement to severance pay, prohibits discrimination and reg - ulates the employees’ health, safety and welfare.
The Labour Act requires employers to: • register the workplace by written notice to the Director of Labour in the Cayman Islands; • furnish each employee with a written state - ment of working conditions containing spe - cific information referenced in 4.2 Character- istics of Employment Contracts ; • provide reasonable training to employees dur - ing their probationary period; • maintain prescribed employee work accounts where there are ten or more employees; • safeguard the health, ensure the safety, con - tribute to the welfare and provide special pro - tective measures for employees as specified; • notify the Director of Labour of major indus - trial accidents and any occupational disease involving employees; • not discriminate; and • provide certain minimum employee entitle - ments including: (a) an hourly minimum wage of KYD6.00 (USD7.32); (b) paid vacation leave (the amount depends on length of service); (c) public holiday pay; (d) up to 10 paid sick leave days annually; (e) paid maternity and adoption leave; (f) at least 24 consecutive hours of rest in each seven consecutive days; (g) overtime pay for hours worked in excess of a standard workday/week; and (h) specified advance notice of termination of employment except for certain good causes. Redress for unfair dismissal may be sought before the Labour Tribunal pursuant to the pro - visions of the Labour Act. An employee is not precluded from bringing an action at common law (for damages) before the courts of the Cay - man Islands. Any compensatory award made by
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