Work From Anywhere: Whose Responsibility Is It?

Buyers wanting to know what the future of managed travel looks like could do worse than read an email from Airbnb co-founder and CEO Brian Chesky to his staff late last month.

Entitled “Airbnb’s design for employees to live and work anywhere,” Chesky outlined a five-point plan, including allowing staff to work in 170 other countries for up to 90 days each per year; and maintain collaboration by bringing the teams together one week per quarter.

Airbnb is not alone. E-commerce company Shopify and payment provider Wise also allow employees to work overseas for up to 90 days a year. However, such flexibility remains rare. As Chesky told his staff, “most companies don’t because of the mountain of complexities around tax, payroll, and time zone availability.”

Chesky is absolutely right about this mountain of compliance, says David Livitt, tax director of mobility services at accounting firm Mazars. That’s the reason, adds Livitt, that when a company announces that “where you work from can be anywhere, it gives heartburn to many departments.”

Speakers at a mobility compliance session at the GBTA Europe/VDR conference in Berlin in March unanimously warned that many regulations could be breached if employees work outside their home countries without preparation or mitigation.

“Employers say anyone can work anywhere. I assume that’s not the case, because there are tax risks,” Meike Gleiken, head of Siemens’ global framework, told the audience.

“It could be either a corporate tax issue or a permanent establishment risk. It all depends on where the employee is, how long he is staying, what task he is performing, does he have a power of attorney? And then you have individual tax obligations that could be affected.

“Immigration is also essential. You can’t just travel for a holiday in Thailand and then extend it for two weeks to work and consider it tourism,” Gleiken said.

Other conundrums include whether employees can maintain their social security plan in the country where they work, whether local or national employment laws apply, and whether employee insurance remains valid.

Meanwhile, BCD Travel’s director of global account management Oliver Meinicke told the session that Work From Anywhere employees would also rub shoulders uncomfortably with the company’s travel and expense policy. business. “If you decide to work from Spain but you are normally based in Munich and your business client is in Frankfurt, the trip from your finca to Frankfurt will certainly not be paid for by your employer. You will have to bear these costs yourself. same,” Meinicke said.

Given the hassle of managing WFA, why bother? The answer, says Aurélie Krau, account manager for meeting booking platform Hubli (which targets companies hosting offsite and team building meetings), is recruitment and retention.

Krau has worked with clients who were “losing the talent war. They said employees were leaving them for competitors where they had more freedom to work remotely. Indeed, Shopify and Wise make a big deal out of their foreign WFA programs’ website career pages. The first even gives it a brand name: Destination90.

If you’re dealing with travel, you’re at the crossroads of all the different departments and all the issues involved, like mobility compliance, employee value proposition and risk assessments.”

If companies want to make WFA a reality without courting legal or tax issues, they need to check three boxes, according to Krau: Will, Competence and Bill.

Will is all about spending time. “You’re going to have to accept that you need the extra effort to get there, because every country has different rules,” Krau says. “You need a decision matrix. It is normal to offer flexibility in a framework. Employees understand because they are not self-employed. You have to come up with a program.

The competency involves identifying the person who will lead the WFA for your business, as this is a role that could potentially slip between several functions, including legal, HR and tax.

As Chesky’s memo makes clear, internal travel is an integral part of a remote work strategy. Therefore, who better placed, according to Krau, to take charge of WFA than the travel manager? “If you’re dealing with travel, you’re at the crossroads of all the different departments and all the issues involved, like mobility compliance, employee value proposition and risk assessments,” she says.

Finally, there is Bill. Time and resources inevitably require a financial investment, but what, Krau asks, is the cost of not offering WFAs if competitors are?

There remains, however, the formidable challenge of resolving the many compliance risks raised at the GBTA Europe/VDR conference.

“The devil is in the details,” says Livitt. “If you are going to work temporarily in a remote country and there is a tax treaty with that country, the risk is reduced. But that does not prevent the host country from asking itself: are you taxable? Need to manage payroll? Do you need to obtain an exemption from social security contributions? Do you need immigration status? Do you need to register your entity for a permanent establishment so that your business can be taxable here? Are you the only one coming to this place? »

For these reasons, Livitt doubts the wisdom of publicly committing to giving staff a certain number of working days abroad, including 90 days. It’s a limit, according to Livitt, that’s even more problematic than, say, 60, because more rules like “economic employer” (the extent to which a business is considered integrated into that country’s economy) potentially come into force.

“There are a lot of risks there,” Livitt says. “It’s not impossible to go through and make decisions, but if I was a tax authority looking at general statements, I’d be rubbing my hands. I now know who to contact to ask for more information.

The way to mitigate WFA compliance risk, says Livitt, “is to manage the application and approval process through technology. The technologies I’ve seen can be configured to really compare variables [such as who wants to go where, for how long and why]. You can make these decisions without overwhelming one person or a team of people.

Tools are emerging specifically to address these issues. Mobility compliance technology provider Tracker Software Technologies, for example, now offers a special rules engine to cover remote working. Oddly enough, in his employee memo, Chesky wrote, “Hopefully we can open up a solution so other companies can provide this flexibility as well.”

Livitt adds that companies will also need to communicate very clear WFA policies to their workforces. And inevitably, travel and expense policies will change.

Regarding Meinicke’s comment about not reimbursing employees coming from their Spanish fincas, Krau says, “I would challenge that. First, you need to articulate the company culture, then what is your workplace strategy. This will define the set of rules you have. You might be able to get an overseas travel allowance because you’re saving on real estate and viewing that money as an investment for your workforce. Everything is possible.

“Maybe once you’re no longer an office-centric organization, the definition of a travel program needs to change,” says Krau.

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