Just days after the World Health Organization declared COVID-19 a global pandemic, almost all the employees at Google LLC, Facebook Inc., Twitter Inc. and Shopify Inc. were sent home, with no word on when they would be allowed to return to their perk-filled offices. Two months later, Google and Facebook extended their work-from-home policies until 2021. Twitter chief executive Jack Dorsey tweeted in mid-May that employees who can work remotely will be allowed to do so forever. 

It seems the future of work is shaping up to be a remote one for a staggering number of white-collar workers. Anyone armed with sufficient internet speed and a working laptop could potentially set up anywhere they liked. Even small companies would suddenly have access to a global talent pool, no longer needing to demarcate their hiring boundaries by geography. 

A win for all, in theory. But the reality would be riddled with myriad legal, technical and security complications. According to experts there are five major issues to consider:

1. Processing Payroll Taxes in a Foreign Jurisdiction
This is the  is the biggest issue companies will encounter when hiring abroad, according to Donald Dowling, a partner at U.S.-based law firm Littler Mendelson PC. “If you’re an American company hiring a data scientist in Estonia, then Estonian employment laws apply,” he said. “You have to report their income to Estonian tax authorities; you can’t just put them on the U.S. payroll.” 

2. Foreign Employees are Subject to Local Employment Laws
A company would also have to give foreign employees all the benefits that come with living in their jurisdiction. “I’ve seen a number of cases of employees for American companies in France asking for maternity leave, paid sick days, vacation time and hours according to French employment law, which they are entitled to, but those companies would not have wanted to (give them that),” Dowling said.

3. Data Security
Remote workers are easier targets for hackers because they are less likely to have the same kind of encryption protocols as employees back at the office. In particular, heightened security protocols exist when data travels between foreign and domestic servers, assuming a worker abroad is communicating with a domestic team on a daily basis.

4. Overhauling Existing Compensation Structures
According to Eddy Ng, a professor of management and organizational behavior at Bucknell University in Lewisburg, Pa, “If you’re out in the Prairies, and you’re no longer paying for commuting and living in downtown Toronto, of course, your employer is going to start arguing that your own costs have gone down, and, therefore, your compensation could come down.” 

Many big Canadian companies, including the big banks, insurance firms and accountants, already provide a small stipend for employees to set up work-from-home offices. Canadians working from home can also claim a portion of some of their home expenses when filing their taxes. “You’re not going to see many companies wanting to maintain their downtown Toronto offices spaces at high rents, and yet providing technology, upgrades and stipends to their workers at home,” Ng said.

5. Establishing a Consistent Corporate Culture
As companies begin crafting a new way of working, they’ll also look at the elaborate perks they often use to attract employees. Google is famous for nap rooms, snacks, games stations and more. 

Jean McClellan, a partner at PWC Canada’s consulting practice,believes that such perks might attract individuals to a certain company, but her data show that office perks are ranked as “one of the lower incentive items.” “What we are hearing from employers, based on feedback from their employees, is that (employees) want a connection to purpose and meaningful work and that’s what drives retention,” she said. “If you can provide a job with meaning, is that maybe better than all of the bells and whistles?”

However, some perks can also help develop a particular corporate culture, which is more difficult to do if people are in far-flung locales and don’t often meet in person. 

Is Remote Working The Way of the Future?
Despite these complexities, Sara Sutton, the founder and chief executive of FlexJobs Corp., a job search company dedicated to remote work, said she’s seen an uptick in the number of companies offering increased flexibility in location when hiring.  “The interest in remote work had already been on the rise over the last 15 years or so,” she said. “This pandemic has just exacerbated the openness that both job seekers and employers have towards this way of working.”

The billion-dollar question, of course, is: Will remote work stay at current levels in a post-pandemic world? Ng is not particularly convinced that the majority of companies will go down the remote work path forever. 

Sutton, however is confident the trend will continue, because remote working offers an “emergency preparedness insurance” for employers. “I don’t think we are ever going to go back to the naive time where organizations were putting their head in the sand about remote work.”

Source: Financial Post