November 29, 2021

The normalisation of homeworking and hybrid working post-pandemic is likely
to lead to more requests to work from abroad, as employees revisit expectations
and limitations around their living arrangements. While this may not present any specific technical challenges compared to remote working in the UK, it may present particular issues for UK-based employers whose employees’ normal place of work is the UK. Some employers have a policy that prohibits remote working from abroad on the basis that an employee is employed to work in the UK. Alternatively, an employer may require approval from HR and its tax advisers in the light of the compliance and other issues associated with overseas working.

If an employer does agree to working abroad, it should record any agreed arrangement with the employee in writing. The agreement should address, among other things:

  • that the employee will continue to work for the UK business only, the contract will remain subject to the laws of England and Wales (or Scotland or Northern Ireland, as appropriate), and that the relevant UK courts will retain jurisdiction
  • any changes to the employee’s contractual benefits during the period of working remotely abroad. Global employers apply different pay bands in different locations based on costs of living and so there may be changes to an employee’s pay rate while he or she is working remotely abroad
  • the employee’s liability for additional income taxes or employee social security contributions
  • the responsibility of the employee for making any personal tax declarations, or similar
  • the employee’s acceptance that he or she is working remotely abroad at his or her own risk and that the employer will not be liable for any losses suffered as a result
  • the employee’s agreement to follow all applicable public health advice, as updated from time to time
  • any additional data security measures that will apply while the employee is working abroad.

A further consideration is the possibility of discrimination. For example, employers should generally not adopt a blanket approach of allowing employees from certain countries to work remotely abroad but not others. However, some rules may be inevitable and it may be possible to justify indirect discrimination: the results of
any tax or intellectual property audit may hinder remote working from certain jurisdictions; an imminent threat of political instability in a country may result in an employer rejecting a request to work from that country; there may be some countries with laws that are at odds with an employer’s core values (for example, in respect of LGBT rights); and employers with US parents may have issues with embargoes and deemed exports, especially if they are in the technology sector.

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