March 14, 2023
The last couple of years have changed the way we work. Working from home is now commonplace, and it’s likely that this will remain the case for the foreseeable future. Requests for flexible working go beyond what was ever imagined a few years ago, with some employees now making requests to work remotely in another country for lengthy periods of time. This may allow them to add a few extra days to a holiday without taking annual leave, or stay with family living abroad. However, employers should be aware of the legal risks of allowing staff to work remotely abroad before agreeing to any such arrangement.
Even if an employee’s contract states that their employment is governed by the laws of England and Wales, an employee who works in another country will likely be benefiting from the employment rights and protections of the country where they are working.
What should an employer do?
An employer should ensure that the terms of working remotely are documented in a written agreement. Within that agreement, there should be the ability for the employer to bring the arrangement to an end if necessary. The agreement should further confirm that the employee’s policies will continue to be relevant when working outside the UK, such as codes of conduct and the employee’s obligations to keep information confidential.
It’s important to ensure that an employee working from another country has the right immigration permission to do so. If this isn’t done correctly, in some cases both the employer and the employee could be committing a criminal offence.
What should an employer do?
Before agreeing to any arrangement in which an employee can work from another country, an employer should ensure that the employee in question has an established right to work in the other country. This could involve asking to see visa or work permits if they are necessary. Some visits could legitimately be considered business visits, but others will not. It’s also important to remember that since Brexit, UK nationals do not always have a right to live and work in EEA states.
By working in another country, an employee (and potentially an employer) could become subject to the tax rules of that other country. The longer the time the employee is working in another country, the greater the risk of this.
What should an employer do?
The rules on tax are complicated in this context, but if an employee has been outside of the UK for more than 183 days, they are likely to have established tax residency in the other country. We would always advise employers and employees to seek specialist tax advice on this issue.
Other issues also need to be considered, such as regulatory requirements, data protection, health & safety and insurance.
What should an employer do?
Each of the above issues need close attention, with each aspect risk-assessed before an employee is allowed to start working from another country. In relation to data protection for example, an employer may need to put additional measures in place to protect data which is being transferred from the UK to another country.
If you need any further help or advice, please contact Rachel Ford-Evans on RFord-Evans@darwingray.com or 02920 829 120 for a free initial chat to see how we can help you.
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