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International remote working – is it the right fit for your organisation?

ECA International

In the final blog in our series on international remote working we discuss the overall pros and cons and cover some of the key considerations for companies implementing and managing international remote workers.

Previous blogs have covered the main compliance challenges associated with international remote working, including tax, social security, immigration and labour law but there are other non-compliance challenges which companies need to consider before they implement virtual assignments or allow employees to work remotely from a different country.

Before we look at those, it is worth noting that compliance is often a moving target, and this is particularly likely to be the case with regulations on international remote working over the next few years, as companies and governments get to grips with this topic. Over the last 18 months we have seen tax authorities take a pragmatic approach by allowing grace periods to individuals who have been affected by pandemic-enforced travel restrictions. Looking ahead though, it is hard to imagine governments being particularly happy about losing out on vital tax revenues which could help shore up their battered economies, so we can expect a more stringent approach as the pandemic eases.

Equally, we can expect a degree of protectionism from governments worried about losing jobs and tax income due to people choosing to work remotely from other countries. Over 20 countries now offer specific visas for remote workers with the intention of attracting high-income individuals. If this results in other countries losing out on substantial tax income, regulations are perhaps inevitable, although potentially difficult to implement.

Advantages

Looking specifically at virtual assignments, one of the main advantages is that there is less disruption to family life compared to a traditional assignment; children can remain in home country education, spouses can continue their home country careers, and the general difficulties of moving between countries are avoided entirely. As our surveys have shown, ‘impact on family’ has consistently been the biggest barrier to employees accepting assignments over the last few years, so this is clearly a big advantage. They can also be quicker to initiate, as no physical relocation is required and, in most cases, they should be cheaper than a traditional assignment as there are fewer allowances and benefits required.

When considering international flexible working, the benefits to the company are slightly harder to quantify - mainly such arrangements function as an employee attraction and retention tool with many employees wanting flexibility about the physical location they work in. Although the realities are likely to be far from the scenario of working on the beach that some people imagine, there are clearly some upsides to having the option to work in a different country, even if this is only intermittently.

Challenges

Looking now at some of the additional considerations that companies will need to make when assessing international remote working, many of these focus on just how effective this type of working is likely to be. This also fits into wider discussions about the overall effectiveness of working from home.

As we see an easing of the Covid-19 pandemic in some parts of the world, it has been accompanied by debate about whether employees should return to offices or continue working from home where possible. There have been claims that productivity has risen due to employees working remotely, and certainly some employees have benefitted from the flexibility offered by working from home. On the other hand, some companies have stated their intention to require everyone to return to working in offices, and some employees have felt that remote working has led to a blurring of work-life boundaries amid increasing expectations that they are always available. The truth probably lies somewhere in between with some people and roles better suited to being based in the office full-time, while others are better working from home.

The reality of someone managing a team while being located separately from them might be something we have got used to during the Covid-19 pandemic, but this has only been due to the highly unusual times we find ourselves in and working remotely internationally brings the additional challenges of working across different time zones, with cultural challenges that can be much harder to manage remotely. A pragmatic approach would seem to be best but making assessments of each role and individual, and ensuring fairness when doing so, will not be easy.

For virtual assignments in particular it may be that an assignee is being asked to manage employees they have never met in person in a country they have never been to. Implementing virtual assignments therefore needs a holistic HR approach to ensure assignment success. This would involve an employee selection process which looks for candidates who have the necessary skills to manage staff remotely (which may be different from the technical skills needed for the role), as well as the planning of the role itself so that some aspects of employee management can be done locally, and so there are clearly defined expectations of roles and responsibilities between home and host offices.

Other considerations

Focusing on virtual assignments, there are considerations around whether they will be carried out from the company’s office in the home location, or if the employee is expected to work from home. This might seem like a minor issue, but if someone continues working in the same office as they did before the virtual assignment it is easy to imagine a significant blurring of the lines between the employee’s new role and their old one, which apart from being stressful to the employee can also have compliance implications. If the employee is expected to work from home, consideration should be given to covering the costs of equipment needed for a suitable home-working environment, and in some cases this may even be legally mandated.

When it comes to international flexible working, companies need to decide how to manage their duties as employers which, in reality, can never be completely dispensed onto employees (unless they opt to become contractors and not employees). Given that, in theory at least, these employees are physically able to work from anywhere, companies should put in place systems, like the award-winning SaaS platform from Tracker Software Technologies (now part of the ECA International group), to track where employees are and the number of days they spend in different locations in order to flag any compliance or employee safety risks.

Therefore, the costs involved in running compliance checks and approvals, tracking employees, providing remote working technology and home office furniture should not be overlooked when assessing the use of international remote working.

Summary

The above considerations make it clear that while there is clearly a place for both virtual assignments and international flexible working, these are not suitable for all organisations or all situations.

The challenge now is for companies to formulate flexible and reasonable policies and integrate these into their current suite of policies. Crucially, processes should be put in place for deciding what type of assignment is appropriate in different circumstances to avoid excessive discussion and exceptions. Given the potential volume of requests for international flexible working which companies may have to deal with (the majority of these are unlikely to be on a permanent basis, but rather for one or two weeks here and there), we would also recommend a transparent decision-making process in which the majority of decisions can be made quickly and cost-effectively. As ever, ECA is here to assist with all of your global mobility needs.

  FIND OUT MORE

To find out more about how Tracker Software Technologies can help you manage the compliance risks associated with business travel, contact the team today.

You can now read all of the previous blog posts in our international remote working series below:

  Please contact us to speak to a member of our team directly.

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