International remote working – often known as ‘workcations’ – has emerged as a transformative force in the fast-evolving realm of work.
Recent research conducted by Mercer shows almost four in five – a staggering 78% – of companies now embrace this practice either as a normal part of their operations or on a case-by-case basis.
The same study shed light on a remarkable shift in the acceptance and adoption of temporary international remote working.
But, while driven by employee requests, the trend is not without its complications.
The term workcation carries a dual meaning. It captures employees’ attention, but it also blurs the line between work and leisure, leading to confusion and critics.
While the notion of workcation may initially conjure images of people basking in glamorous destinations, it is more often about offering employees a better lifestyle and addressing family issues.
Organizations are increasingly attuned to accommodating personal and familial needs and often, it aligns to their objective to attract and retain talent by offering a range of lifestyle benefits.
A fad, or a long-term flexible working tool?
The workcation trend transcends industries, underscoring employees’ growing desire for flexibility and work-life balance.
One of the primary catalysts behind temporary international remote working is the flexibility it gives organizations to address employees’ unique circumstances and swiftly resolve ad hoc issues.
The advent of the COVID-19 crisis propelled the popularity of temporary international remote working.
With employees finding themselves unable to return to their home countries due to travel restrictions, many opted for extended stays where they were.
What was an exception during the pandemic, is fast becoming a ‘new normal’.
This newfound flexibility not only enhances work life balance, but also aligns with the evolving hybrid working models embraced by many organizations.
Almost six in ten (58%) of the organizations Mercer surveyed, anticipate a surge in the number of requests for such arrangements, with a mere 4% predicting a decline over the next two years.
This palpable shift signifies a growing inclination toward embracing international remote working as a long-term practice rather than a fleeting trend.
The main drivers for offering temporary international remote working are the flexibility to respond to employees’ situations (a driver or a key driver for 71% of respondents), as well as improving employee satisfaction (61%), and addressing family issues (62%).
Interestingly, more than half (51%) of respondents indicated that responding to market pressure and remaining competitive in terms of benefits, was also either a driver or a key driver.
Identifying and mitigating the risks of workcations
However, the shift toward international remote working also presents challenges for HR and compliance teams.
Allowing employees to work remotely from another location, even for a limited duration, still presents risks for organizations in terms of taxes, employment laws, and immigration.
Furthermore, duty of care is a critical consideration for organizations when employees work remotely internationally.
Organizations have a responsibility to ensure the health, safety, and wellbeing of their employees, regardless of their location.
HR policies can help to mitigate risks associated with workcations. These policies typically include setting a maximum duration for workcations, often ranging from 20 to 30 days per year.
While this maximum duration helps limit risks, it does not completely eliminate them. In certain locations, employees on workcation may inadvertently trigger tax liabilities from day one.
To further minimize risks, companies can restrict the list of allowed destinations and specify the types of remote work that can be performed.
This helps prevent employees from establishing a permanent presence in locations where the company does not have a legal entity.
For example, positions such as the head of the business, who frequently signs contracts, are more likely to trigger permanent establishment compared to basic support functions.
Despite these guidelines, it is crucial to conduct ad hoc compliance checks and maintain ongoing monitoring to ensure employees and their companies do not find themselves in challenging situations.
Managing the HR burden
Beyond the compliance issues, the increasing number of employee requests can represent a real burden for HR teams.
For many organizations, the question at hand is not a simple binary choice: should temporary international remote working be allowed, yes or no?
It is a nuanced decision that requires careful consideration of how much time and effort should be invested in managing these requests, weighed against the expected benefits in terms of employee satisfaction.
Mercer’s survey reveals that a significant 62% of companies still rely on manual tracking of international remote working, while 26% do not track it at all.
This lack of systematic monitoring and metrics poses a considerable hurdle for organizations striving to remain compliant and trying to assess the impact of their international remote working initiatives.
Furthermore, a staggering 93% of companies lack the necessary metrics to gauge the success of their programs.
This places HR professionals in a precarious position as they endeavor to demonstrate the value and effectiveness of international remote working to stakeholders within their organization.
Clarifying and communicating policy of workcations
The absence of a unified perspective on remote working, both at local and international levels, further complicates matters.
Divergent opinions about the benefit of workcation among stakeholders and lingering doubts regarding the performance of remote working initiatives can muddle the message and undermine the company’s effort in the employees’ eyes.
HR professionals face the arduous task of clarifying their communication strategies and refining their employee value proposition – only by doing so can they harness the potential of temporary international remote working.
Sending mixed signals or creating difficulties for employees to understand the company’s policy undermines the credibility of the organization.
It may even result in employees working remotely without proper authorization.
From exception to expectation
Despite these challenges, one thing remains abundantly clear: international remote working is not disappearing anytime soon. What was an exception is fast becoming an expected benefit.
Beyond compliance and metrics, HR professionals can play a pivotal role in shaping the narrative around international remote working.
By championing the benefits of work-life integration, HR can position organizations as pioneers in promoting employee wellbeing, productivity, and engagement.
However, unlocking the full potential of international remote working will require HR professionals to think beyond traditional boundaries.
Organizations now have an opportunity to leverage this trend to fuel their attraction and retention efforts — or risk alienating their talent.
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