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Social Security: Future implications for international remote work

In brief

Businesses are grappling with the evolving day-to-day challenges of COVID-19, but many have proven
remarkably resilient and adaptable, staying open by switching to virtual working. Some companies have
experienced unanticipated benefits of this model and now are considering extending virtual working even
as restrictions are lifted.

Some of the potential business advantages of enabling virtual work include increased productivity, lower
overheads, larger and more diverse talent pools, lower staff turnover, and reduced time lost to ill health.
There also can be wider societal benefits, such as less environmental damage from commuting.

In the right context, these advantages may be multiplied by facilitating virtual work across international
borders. However, to take advantage of international virtual working, there are several compliance issues
that need to be managed. This publication explores the social security issues for international remote
working.


In detail

There are three important categories of future international remote workers (outside of existing formal
assignment structures):

• Permanent home workers: Employees who will permanently work remotely in another country;

• Global nomads: Employees who will relocate to another country to work remotely on a short-term basis (they may do this multiple times during their career); and

• Global commuters: Employees who will relocate to another country and commute between their
home there and their 'base' country (i.e. the country in which they are formally employed) on a regular
basis

Each of these categories brings its own social security challenges. In this publication, we have only
considered scenarios where the individual remains on a ‘base’ country employment contract.
 

The takeaway

For businesses considering implementing cross-border remote working practices, the following social security issues
Businesses are grappling with the evolving day-to-day challenges of COVID-19, but many have provenshould be considered:

• Whether the move will alter the employee and/or employer liability. If so, what are the cost implications?
• Where an employee-driven move will increase employer costs, how will this be managed by the company?
• What registration obligations may be triggered outside of the employer's ‘base’ country?
• What communications are required between employees and managers to maximise the understanding of a company's remote working policy and its implications for social security contributions and benefits access?
 


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