At least that’s what HR tells me in my current job, as a reason why they won’t let me go full remote.
Are they right? How are full-remote companies handling this?
Edit: Context is EU/UK.
The employer worked with a big-ish professional services company who did all the necessary payroll and paperwork for them.
Overall it was super smooth and except the taxes nothing was different than working for a Germany company. But I know that the ease of hiring really depends on each country, and I know that the company was only considering opening up remote positions in countries where there was an ample talent pool, basically where they could except to hire enough people to be worth it.
One thing to understand about fully remote is that it can mean a lot of things to HR. For example, if they approve 100% remote, does that mean you're outside of an office? Outside of a city? Outside of a state? Country? Are you nomadic?
I can tell you that when I was previously employed by a company where one of my conditions was I want to be 100% remote in another state, the agreement was I was hired in State A, and then my boss didn't enforce butts in seats, and they ignored that I was in State B from their side of the fence, and I paid taxes in State B. It was illegal, and I wouldn't recommend doing this.
In practice, I could almost certainly work from laptop in an adjacent state (on my own dime) for a bit and no one would care but actively misleading about your address of record is not advised.
She rarely travels for business, but because the firm has people in many of the states in the US, she ends up filing taxes in something like 37 states, every year. Because the firm has a locus in that state, and she is a partner in the firm, that means she has to file taxes there, even though she has not visited that state this year, and has not done any work for any client in that state this year.
Yes, it’s a pain in the ass. But that’s why we have professional tax accountants to deal with the complexity.
There is nothing I have found in business that matches the complexity of HR and tax accounting.
But kidding aside, I feel that the restriction may be an overreaction. Lawyers and accountants can sometimes overcompensate when it comes to stuff they don't fully understand.
I had a friend that wrote a 99-cent iOS app (I don't think he made enough to cover hosting and licensing fees), and his accountant was a bit "over the top." He insisted that my friend could get into serious tax jeopardy over the App Store stuff, and insisted that he pay about a 50% tax.
Hearing about it was painful. Sounded like the guy needed "help," but I'm told that otherwise, he was an outstanding accountant.
This is only solved by either setting up a local office and hire local experts yourself, or working with an employer of record.
Source: I'm the CEO of Remote.com and we do this for other companies across the world, and run all our own entities and compliance.
I see how this is true in general, but aren’t there special cases e.g. within the EU, between the EU and the UK, or when an employee moves country while still being employed, where simpler solutions may exist?
There are cases and/or ways where you can e.g. hire someone under a local contract without owning a local entity, but that doesn't scale much beyond that, and you'd still need to run local payroll somehow, and be locally compliant.
The one big thing the EU solves is mobility: any EU citizen can work freely from anywhere else in the EU. That's a massive hurdle to cross otherwise.
Beyond that, even between EU countries there are absolutely massive differences in labor laws, standards, etc.
And how is the situation when the employees come in from time to time (commuting across borders) but work the majority of their time in another country?
> And how is the situation when the employees come in from time to time (commuting across borders) but work the majority of their time in another country?
This is a gross simplification, but:
You must comply with where you spend the majority of your time. Spending a few days/weeks outside of your homebase is normal (see: all business travel) and doesn't make you immediately liable.
That said, this gets really complex and murky when you think about e.g. nomads or people that really split their time between countries.
the only complication is that i have to figure out myself what and how to pay.
Beyond that, it's not uncommon for remote first companies to "hire" people as independent contractors as workaround to these problems.
That said, it's never fully plug-and-play. If you're small enough you can skirt some of the complications, but every country has very different laws around mandated time off, taxes, social security, the ability to classify a worker as a contractor vs employee, benefits, protections like whether/how you can lay someone off, etc.
So it's doable, but it's not seamless.
However, in practice, a remote worker can move anywhere, create a company (in the country where they live), send invoices and get paid. The catch is you need to take care of more taxes and admin work and there are none of the employee protections. You're essentially providing B2B services.
So, there are no legal issues for your old employer, as long as you're comfortable with that. It's mostly that employers would rather own you, as that gives them certain rights and benefits vs. just purchasing services from a contracting firm.
Many countries will forbid that. Employment is characterized by more than the wording of a contract.
the employer can't employ you in their country, and they can't be forced to set up a business entity in yours.
the only thing your country could do is to prevent you from doing business with foreign companies as an individual contractor, but that would be counterproductive as it would not get you the employment they want you to have
If you are curious about labor laws you need to talk to a lawyer.
And yes we’re hiring a lot https://jobs.lever.co/1password
So, only those three countries right ?
Hit me up (email in profile) if any of the roles listed here² look interesting to you.
Any plans for EU remote roles?
2) Having people team members who were fully focused on 'remote experience', and ensuring that perks for in-office folks had comparable events and such for remotes.
3) ~Almost all roles being eligible for remote. There were a few organizational exceptions outside of eng, but for the most part any team could hire remotely with fairly little friction.
Really, it was a learning experience over time, and it requires intentional effort to be a 50/50 company, but despite some other flaws, DigitalOcean was ~generally good at this while I was there.
I'm guessing this is no longer accurate.