The costs and benefits of Bermuda’s term limits policy are, like many things in life, a matter of perspective. If you are a blue-collar worker, you have likely seen expat workers come and go with minimal disruption to work flow. For example, if an expat electrician, plumber or mason is scheduled to leave a company, it is often only a matter of weeks before his expat replacement is completely up to speed.That’s because the world of physical labour, by definition, deals predominantly with physical things that are relatively constant. Stranded 12-gage wire, 675-PSI copper pipe, and 43-grade cement do not change their essential form or substance from day to day or from job to job.So the new expat employee, who already has much experience working with the materials and tools of his trade, can smoothly transition into the job vacated by the old expat employee. Yes, he must learn certain idiosyncratic parts of the Bermuda industry, such as which stores are the best sources of certain materials and which workers are the best sources of helpful information, but he can easily and quickly handle the largest part of his job working with familiar equipment and materials to build or repair a given product.Given that perspective, it is understandable that a blue-collar worker might consider the term limits policy a viable way to control long-term residency of expatriate workers and perhaps encourage employers to train more Bermudians for jobs.However, if you are a white-collar worker, particularly someone in middle or upper management, your perspective of the costs and benefits of the term limits policy is likely the complete opposite. That’s because International Business is predominantly a world of non-physical things like information and relationships.For example, the manager of an insurance company’s claims department (usually a lawyer) requires legal training to understand the intricacies of each of the numerous lawsuits that he deals with on a daily basis. In that regard, he is much like an electrician or plumber who requires training to understand the intricacies of his profession. But that does not mean a company can easily replace its claims manager without suffering great disruption and potential risk of loss. That’s because the nature of a claims manger’s work involves very specific information unique to his job and depends on very specific relationships that have been developed over the course of his employment.For instance, the manager will have developed a strong working knowledge of the legal strengths and weaknesses of each of the numerous insurance claims and lawsuits he manages on a daily basis. It would take his replacement many months to get up to speed on those files and it is quite possible that some time-sensitive matters could be mishandled during the transition.The manager also will have developed a strong working relationship with each of the overseas lawyers who are handling these various lawsuits, and over the course of time he will have come to know their individual strengths and weaknesses. That time-acquired information enables him to better manage the company’s legal exposure by ensuring that the right files are handled by the right lawyers.These types of personal assessments, which are made on a daily basis yet can only be accurately made after years of working together, are but a small fraction of the world of relationships and job-specific information that are an essential part of international business. For instance, reinsurance companies, insurance brokers, captive managers, investment management firms, etc, have numerous employees from the CEO all the way down to administrators who help develop and maintain time-acquired information and long-term relationships that meaningfully contribute to the successful operations of these companies.So in 2002, when the Progressive Labour Party Government announced the introduction of its term limits policy that limited an expatriate’s term of employment in Bermuda to six years (with waivers to a maximum of nine years), the International Business community was stunned. “How can you possibly ask that we fire our expat employees every six years and replace them with new ones when doing so will jeopardise the hundreds of relationships these individuals have developed with our clients, consultants, suppliers and strategic partners?”But the PLP Government refused to withdraw the policy. Instead, they pointed out that key employees such as the CEO and other top executives could apply to the Government for waivers and that the policy would only go into effect in 2008 — six years after its introduction.Over the next six years IB representatives met numerous times with the Premier and ministers. They explained that valued relationships were developed and maintained at almost all levels of IB companies, not just at the CEO and key employee level. They explained that many of these expat employees had amassed time-acquired information that may be jeopardised if they had to keep replacing these employees. They explained that limiting a person’s employment to six years made it difficult to recruit the best and the brightest candidates. They explained that having to rely on a waiver from Government — which may or may not be granted — was too big a risk for them to take.Most important, they explained that if the Government did not revoke the policy, the companies would have no choice but to move entire departments out of Bermuda resulting in the loss of hundreds of Bermudian jobs in the IB sector and thousands of Bermudian jobs in the local industries that directly and indirectly relied on IB business (e.g., law firms, accounting firms, computer companies, retail stores, restaurants, landlords, etc.). Unfortunately, the PLP Government refused to revoke the policy. So in 2008, when the policy became fully effective, IB companies began shipping jobs, departments, and in some cases their entire operations, overseas. And over the next four years the predicted devastation became a reality.Perhaps the saddest part about the policy is that its unintended effects — the loss of thousands of Bermudian jobs and the loss of hundreds of millions of dollars in Government tax revenue — was completely predictable. The IB representatives had explained numerous times to the Premier and various ministers what would happen and why it would happen, but the Government ignored the warnings and steadfastly refused to revoke the policy.Further, when it became clear that Bermudians were losing thousands of jobs, the Government tried to deflect the blame by claiming that those job losses were simply the result of the global recession. Such explanation might have made sense if the IB companies had simply eliminated jobs as part of a downsizing in the face of falling global demand for their services, but the fact is that these IB jobs were not being eliminated; they were simply being moved to other countries that did not have a term limit policy or extremely high payroll taxes. In other words, the loss of many jobs in Bermuda had little to do with the global recession, and much to do with a Government that applied a blue-collar perspective to a predominantly white-collar economy.Yesterday, a number of well-intended blue-collar workers likely joined the rally to reinstate the term limit policy. Because of the perspective they have acquired from years of working in blue-collar industries, they can be forgiven their belief that term limits are a reasonable answer to the problem of long-term residency of expatriate workers in Bermuda. But PLP Ministers know better. They know the devastation that term limits caused, and they know the reasons why. They also know that they could help bring some of those IB jobs back to Bermuda by declaring that the PLP has no intention of reinstating term limits if they are returned to power.That public promise to forever kill Term Limits would go a long way to welcoming IB companies back to Bermuda so that the island can begin its slow recovery from a self-inflicted wound.