Few business leaders are ready to deal with the legal challenges that come from moving their operations to a virtual office. You’d be hard-pressed to find people who’d argue against allowing their employees to work online. There are, however, some issues that managers need to be aware of before they start moving people to an online workplace.
Anyone who works in the accounting department will likely point out that income taxes have become the first sticking point for business owners. Remote workers who aren’t merely contractors still count as fully employed persons in most jurisdictions. Employers often need to adjust any withholding taxes tied to their remote workers. Local laws imposed by their region remote workers live in usually impact their tax burden. Human resource departments should be aware of this and adjust their pay stubs accordingly.
They also need to bone up on how certain laws could impact their hiring practices.
Complying With Local Labor and Financial Reporting Rules
Payroll operators should figure out exactly how much each employee owes to public social insurance programs and deduct this amount automatically, regardless of whether they ever come into the office personally. Clearly spell out each financial deduction so remote workers know how much they’re paying into these services. That should make it far easier for them to prepare their own income taxes at the end of the year. Virtual staffers wouldn’t be happy if they got slammed with a nasty penalty, so it’s important to keep them in the loop as far as
Since relatively little legislation currently relates to full time remote work, many questions involving labor law remain unanswered. Business owners should generally apply the same rules they use when deciding how many hours their in-person employees have to work. If you wouldn’t ask someone to do something while sitting in the office, then it’s not fair to ask them anywhere else.
Recruiting people from all over the world is a great way to expand your pool and attract a diverse workforce. Managers need to remember that they’re responsible for adherence to any additional guidelines imposed by regional regulators.
Staying On Top of Foreign Legislation
Considering the complexity that comes with managing remote workers in multiple countries, it shouldn’t be a surprise that some companies call in third-party professional employer organizations to take care of the headaches. Supervisors who want to be certain they won’t run into legal problems will want to contract out these responsibilities to someone in the same general area as their employees. For instance, someone hiring contractors in the Republic of India needs to work with an Indian PEO who will act as their legal representative.
Specialists legally tied to the PEO will pay remote workers, thus making the foreign organization liable for them. In most cases, this absolves business owners of any problems they might run into if their contractors file a dispute. Large corporations have long relied on these sorts of arrangements, but small firms have quickly become the primary customers.
Complications arise when someone is working with talent from regions where these arrangements aren’t an option. HR department staffers may want to consider bringing in at least one legal specialist for each region they recruit in. Some tech-savvy businesses have hired local specialists who themselves are remote workers, which can keep costs down without falling afoul of any foreign ordinance.
No matter what way you choose to tackle this issue, you’ll want to take a closer look at your communications protocols so you don’t add to it.
Combing Over The Lines of Communications
Despite the fact that some long-term employees have returned to their physical offices in recent years, it’s likely that the overall number of people working remote will continue to increase for the foreseeable future. One study found that 41% of workers who can do their job from home have gone to hybrid schedules. This percentage could very well jump in the next few months, and that’s forcing governmental agencies to reexamine security guidelines.
Most companies will probably want to use secure voice over IP lines so they don’t risk exposing anyone’s sensitive information. These are relatively affordable and generally meet privacy requirements laid out by various international bodies. Firms that outsource sensitive financial or healthcare-related work have to take special precautions before they send any virtual paperwork to their contractors.
Authorities are laying out minimum encryption standards that stipulate how much business leaders need to scramble data before sending it over the Internet. You’ll more than likely want to exceed these standards by several levels. That prevents you from having to go back and revise your workflows if details change at some point in the future.
As more people ask their employers for the chance to work from home, more businesses are going to have to offer them the opportunity. Ironing out all of these regulatory wrinkles will help make the transition that much easier.
