Fri, 19 Feb 2021
THE global pandemic has prompted a surge in remote working among office-based employees. For most this means working from home, but increasingly employees are re-evaluating where they work. Business owners are reminded there are significant considerations to weigh up if an employee asks to work overseas.
The potential tax impact for both the individual and the company can sometimes be commercially and administratively burdensome, so it is worth investigating the tax position before considering the next steps.
The employee’s contract of employment will need to be updated to address the usual homeworking issues, which include:
An employer will need to consider whether the individual will actually have the right to work in the country concerned.
This will depend upon the immigration rules of the relevant country, together with the nationality and right to work status of the employee.
If the employee wishes to work from an EEA country and is a UK national, it is worth noting that the Brexit transition period will end on December 31, meaning that it may be beneficial for a move to take place prior to this date.
Local immigration advice should be taken to ensure working abroad does not result in illegal working and non-UK national employees should be encouraged to take their own independent immigration advice (including any impact their absence from the UK may have on a return in the future).
Employers should speak with their current Employers Liability Insurance (ELI) provider to establish whether the current ELI will cover an employee working overseas. Additional or local cover may need to be obtained.
Where employees live and work abroad, they can become subject to the jurisdiction of the overseas country and benefit from the local mandatory employment rights regardless of what is stated in the contract (ie local laws can potentially override express contractual wording).
This may, for example, include health and safety obligations, rest breaks, paid annual leave, family friendly rights, pension entitlements and, typically the most onerous, rights on termination of employment.
Employers should seek local advice on this point to understand the likelihood of foreign employment rights and protections applying and what steps can be taken to avoid this.
Dependent on the nature of the relevant schemes or policies, the employee’s participation in company benefits (such as pensions or private health care) may be impacted or invalidated by a move abroad.
Setting a precedent
Employees do not have an automatic right to change their place of work and a move will of course depend on an individual employee’s circumstances or role, but it may cause friction or be difficult to reject a future employee’s request when a previous employee has been granted permission in similar circumstances.
When communicating an employee’s move abroad, it is wise to highlight the one-off or discretionary nature of the arrangement.
If you would like further advice on remote working overseas, or any other aspect of employment law, contact employment solicitor Charlotte Allery – email@example.com, (01635) 521212.