Remote, overseas workers: What are the HR implications for employers?

With the continuation of hybrid work, there has been a massive spike in people working remotely — and even overseas. But what are the hidden HR implications that Australian businesses need to consider when their employees work internationally?

We’ve revealed a list 10 pitfalls catching employers out with staff based overseas, and how to overcome them:

The below is general advice only and not official legal advice.

Steps to take when hiring overseas, remote workers

1. Ground rules

   In many cases, work performed overseas will be subject to local laws which differ vastly from country to country. The obligations of an organisation when it comes to employing people — minimum rates of pay (and how it is paid), annual and personal leave, taxation, pension and/or insurance contributions— may be vastly different to those in Australia, and therefore it is strongly recommend companies thinking of employing staff overseas first speak to an expert in the workplace law for the relevant country before taking any other steps.

2. To contract or not to contract

   Once a business has an understanding of the obligations and work conditions set in the relevant country as per point 1, another consideration may be whether or not to appoint staff as employees — or as contractors.

   It may be that it is common and relatively straightforward for people to work as independent contractors in the company that the overseas person is based. It also may work out best for all parties to have an arrangement where they work for the organisation on a project-by-project basis, rather than go through the administrative and legal hoops needed to be set up as an employee.

3. Anytime work

   Depending on where an overseas employee is based, time zone differences may mean that the overseas employee is performing work while the company offices are closed and vice versa. This can create a time lag between when queries need to be answered or problems need to be solved, compared to when they are actually solved. This can also mean that communication is confined to email other forms of electronic messaging.

   While this may not be a problem for certain service based industries or back office functions, it is something worth working through before any arrangement is put in place.

   Additionally, in regards to pay, an employee is ordinarily subject to the laws of the country in which they are based. This means they would incur time based penalty pay and other conditions if the “host” country had them in place; i.e. overtime, work outside of ordinary hours. 

   A company can, by its own discretion, agree to do this (as long it meets the other obligations of the host country, as mentioned in point 2). Hence, it is important to remember that an overseas employee working hours outside of those which are considered normal in Australia may incur different or no penalty rates to what an employee is entitled to as if they were based in Australia.

   Again, it is paramount to seek advice from a local workplace expert to determine what should or should not be included in any employment agreement.

4. Whose office is it anyway?

   Another question to answer is what equipment is required to enable an overseas member to perform their role, and who pays for what in that set up. There is the obvious need for computers and communication devices — but employers also need to consider items such as a desk and chair to ensure that the employee is comfortable to perform work for an extended period.

   These are considerations that are essential to mitigate the risks of back/neck problems, repetitive stress injuries and the responsibility of ongoing monitoring and maintenance of the equipment.

5. Upskilling

   Onboarding and training are also things that need to be considered when it comes to arrangements with an overseas employee.

   Are there requirements in your industry for ongoing professional development, accreditation or licencing? How would this be delivered to a remote location? It is important to understand how all required training will be delivered, the costs associated with doing this, and how challenges such as differences in time zones can be overcome.

6. The disconnect

   A number of recent studies have found that the isolation of working remotely through lockdowns and changes in operations has resulted in large numbers of employees feeling isolated and stressed.

   Organisations that offer remote working for overseas based employees should carefully consider the steps they can put in place to ensure that overseas staff feel connected to their teams, the organisation and the bigger picture. Actions such as scheduling regular check-ins and all hands meetings that are available to remote staff can be a good starting point.

   It’s also important for employers to consider the differing circumstances of employees based overseas: are there issues happening in that country or city that could affect a workers safety and mental health? These regular check-ins can help to discuss such matters, and act accordingly.

7. Measure of success

   Arrangements with remote employees don’t always work out and so it is advisable that organisations have processes in place to establish whether the arrangement is productive and that desired results are being achieved.

   It’s also important to have a pre-established exit strategy for if the arrangement is failing. This could include performance management plans delivered remotely and/or termination of the arrangement or employment altogether.

8. Beware the squeaky wheel

   While you may heard the adage that “the squeaky wheel gets the grease” several studies have shown that the opposite is also true. In fact, employees who work remotely are statistically less likely to be considered for promotion, salary increases and other rewards than their counterparts who work in a company office space. Companies should challenge themselves to come up with ways to ensure that they create the same types of opportunities for staff to be recognised for their achievements regardless of where they work from.

9. Watercooler wisdom

   The passing of informal “know-how”, shortcuts and other useful information is another thing that overseas based employees often miss out on. Information about changing circumstances on the ground which may be readily available through local news may not find its way back to staff based at other locations.

   Internal messaging forums such as Slack, MS Teams or an internal wikipedia may be worth putting in place to ensure that informal knowledge and suggestions for improvement are shared in a time orderly fashion with overseas based employees.

10. One size doesn’t fit all

    Organisations who are setting up an arrangement to facilitate an employee working from overseas need to be aware that they are setting a precedent; a precedent which other employees will take note of and may request for themselves.

    It is wise to be clear in communications if an arrangement has been put in place due to special circumstances and that it may not be an arrangement available to everyone. It may be that certain functions/roles allow for this transition, while for others, it just can’t work. Being open and transparent and allowing employees to ask questions are key to avoiding resentment and perceived unfairness.