At this point, a remote work policy is not a new concept. However, there continue to be challenges for employers in navigating the “dos and do nots”, especially when it comes to employees working out of province or out of country. Below, we have addressed some common questions that we receive.
Do employees have the right to choose remote work?
The COVID-19 pandemic, as well as growing awareness around wellness and work/life balance, undoubtedly accelerated existing trends for remote work. Now, more than ever, a greater number of job applicants and employees are seeking remote work arrangements.
However, unless it is explicitly laid out in an employment agreement, employees do not have the right to choose whether they want to work remotely.
If employees are permitted to work remotely, employers should be diligent about the parameters of such work given the heightened risks that come with employees working out of country or out of province, particularly for extended periods of time.
What are some the risks of allowing employees to work from another country or province?
- Employment Standards: Employers must be aware of applying the correct employment standards when it comes to minimum wage, hours of work, vacation, public holidays, termination entitlements, etc. For example, different legislation applies in each province. Even if a company’s head office is in Ontario, if an employee is living and working from Alberta, the employment standards legislation in Alberta will likely apply. Similarly, the laws of another country may apply – do you know the laws of that country?
- Health and Safety: Employers are responsible for ensuring a healthy and safe work environment for employees and must consider the applicable occupational health and safety legislation for the appropriate jurisdiction, as well as workers’ compensation requirements. Because the definition of the “workplace” has broadened to include areas outside of a traditional office, employers should ensure employees have the appropriate space to conduct their work duties remotely and remind employees of best safety practices. This is also true for related insurance and regulatory issues.
- Tax Implications: International and interprovincial arrangements raise a variety of income tax and business tax considerations for employers. An employer should ensure that it has policies governing how long an employee may (or may not) work outside of the employer’s normal jurisdiction and what types of work can (or cannot) take place. We recommend speaking to a tax lawyer to determine if ‘out of country’ work exposes you to taxation (corporate for employers or personal for the employee) in that country – nobody likes double taxation or the hassle of correcting tax errors.
- Immigration: Is the employee legally entitled to work in that country? Virtually all countries require some type of work visa and most also prohibit work when travelling for personal reasons. To avoid getting offside of immigration rules we recommend you engage an immigration lawyer in advance of approving any out of country remote work.
What is the best practice?
Generally, employees should be required to keep remote work to a specific province unless granted permission otherwise. If granted permission, employers must be clear about the requirements and expectations surrounding out of province or out of country remote work.
A remote work agreement between an employee and employer is always good idea.
The agreement should include the following:
- Length of Time – define how long it will be in place for
- Location – define acceptable locations where the employee can conduct their work (i.e. specific city/country/time zone)
- Reporting requirements – for example, attending mandatory meetings, logging in at certain times, being available via phone, etc.
- Equipment being maintained throughout the duration of the agreement
- Expenses/reimbursements – for example, reimbursement for eligible long-distance calls, etc.
- Time and attention – state the hours of work the employee is expected to be “online”
- Amendments – the employer should reserve the right to modify or cancel the agreement and state that remote work is a privilege and not a fundamental term of employment
To return back to the title of this Alert, “Work from Anywhere Policies: Blessing or Curse?”, it is also important to acknowledge the many blessings of remote work. Among today’s workforce, offering flexible working arrangements will be key in retaining employees and ensuring higher levels of satisfaction and engagement. Some countries are now offering “Nomad Visas” to encourage remote work and benefit from additional economic activity of those working in their countries.
That being said, there are heightened risks when it comes to remote work outside of the province and especially outside of the country. Employers must ensure they are taking the necessary steps to clearly communicate with employees the parameters surrounding such working arrangements in order to avoid unnecessary liability and mitigate risk.
Our e2r™ Advisors are happy to further discuss any employment related questions or concerns you may have!