Remote(ly) controlled employees - Do you have employees working overseas?


2 mins

Posted on 23 Apr 2021

Remote(ly) controlled employees - Do you have employees working overseas?

Over the last year, many employers have seen the advantages of their employees working remotely. Increased productivity, easier recruitment, improved retention and of course lower costs.

The result is that five straight days in the office is likely to be a thing of the past for most, even when things do finally return to normal. With Zoom here to stay, employers have been rethinking how their business functions and particularly how to manage and support their most important asset - their people. For those with a UK workforce, new practices and policies etc. may for the most part be more straight forward.

But where employees are now based or resident outside of the UK, employers will have a host of issues and new challenges to deal with including: 

  • Acquiring local employment law rights
  • Tax/social security implications
  • FCA issues
  • Pensions and other employment-related benefits
  • Corporate and local company law requirements
  • Intellectual property
  • Data protection
  • Health & Safety
  • Insurance 
  • Immigration status and the right to work in the UK

This webinar looks at the implications of an overseas workforce and features James Anderson (Partner), Charlie Herbert (Partner), Malini Skandachanmugarasan (Legal Director) and Mike Hibberd (Associate).

Webinar Takeaways 

Employment

  • Depending how long the employees have been posted abroad and the type of work they do, employees could gain overseas employment rights. Local advice may be needed to determine which rights may apply.
  • There is no automatic right to dismiss employees who refuse to return to the UK if requested – it is fact specific.
  • Just because a contract says disputes are under English law does not mean this is the end of the story – other considerations may come in.

Immigration

  • Keep up to date with changes to the Home Office’s Covid-concessions and dates on which certain concessions come to an end for sponsors and migrant workers.
  • Check that a migrant worker’s UK immigration permission remains required and valid depending on whether they are seeking to return to work in the UK.
  • Be mindful of the effect of and reasons for an individual’s absence from the UK in terms of securing permanent residence in the UK in the future.
  • The deadline for the EU settlement scheme is approaching fast! Make sure any EU nationals with residence in the UK look to secure their UK immigration status by submitting their application by 30 June 2021.

Data Privacy

  • Staff working overseas remotely may result in businesses transferring data internationally. Consider the type of data they are processing and if the UK policies for data apply to them.

Company Law Issues

  • Articles of Association may need updating if key individuals are overseas.

FCA

  • There is no blanket ban on employees in FCA regulated firms working overseas. FCA guidance on the SM&CR specifically addresses the issue of overseas employees.
  • Where an FCA regulated company has employees overseas, it will need to assess whether there are any increased risks, such as adequate systems and controls to prevent money laundering, and whether it can continue to meet the requirements of the SM&CR.
  • The Chief Executive Officer Senior Management Function (SMF1) is accountable for ensuring an adequate process for following and adhering to government guidance. 

Insurance

  • Key insurance cover includes employer's liability insurance, property and business interruption insurance, directors' and officers' (D&O) cover and cyber liability insurance.
  • Companies must ensure that they are still complying with existing policy terms and conditions. The policy may require insurers to be notified of changes in risks or significant changes to working practices.
  • Where insurers want to change their policies to exclude coronavirus, the FCA expect insurers to make it very clear to consumers before renewal that their policy has changed, and of the exclusion.
  • Insurers may seek to make mid-term adjustments to policies to reflect the changing risks associated with both lockdown and the return to work. If so, insurers need to consider the interests of the policyholder and that there is a written term in the contract that allows the insurer to make the changes.

Health and Safety

  • You must provide a safe working environment for employees, irrespective of where he/she is based. 
  • You should undertake a risk assessment for every employee who is proposing to work abroad. The employee should also be included in your overall COVID-19 risk assessment You should consider local health and safety requirements and public health guidance.

Summary

It is likely that there will be less risk if the employee has only been overseas for a short time but you should take advice locally, as well as in the UK, as to what rights the employee has in the host country, before taking any action.

Interested in a particular area? Find the answer easily without watching the whole webinar (times are approx)

  1. Minutes 1-2. Intro
  2. Minutes 2-4. Question - If your employee goes to work in Spain, can they acquire rights? What rights?
  3. Minute 4-5. Question  – Jurisdiction clause.
  4. Minute 5-6. Question - How do we bring an employee back to UK?
  5. Minute 6-7. Question - Can we insist on having someone return to UK?
  6. Minute 7-11 Question - International medical.
  7. Minute 11– Question - Social security for remote working.
  8. Minute 12–16.5 – FCA international employees.  
  9. Minute 16.5-17.5 – Employees working abroad GDPR implications – permanent establishment.
  10. Minute 17.5 – Question - IP issues.
  11. Minute 18-21.5 Insurers
  12. Minute 21.5 – H&S issues
  13. Minute 23 – Special category data 
  14. Minute 26-28.5 - Adequacy decisions GDPR 
  15. Minute 28.5-31– Safeguards for remote working. 
  16. Minute 31-39.5 – Immigration status and right to work in UK 
  17. Minute 39.5 – Settlement scheme 
  18. Minute 41-43 – Question re transfer and assignment 

Our Experts

Charles Herbert

  • Partner & Head of Regulatory and Financial Services Disputes
  • T: +44 (0)20 7778 7231
  • Email me

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James Anderson

  • Partner
  • T: +44 (0)118 951 6762
  • Email me

View profile

Mike Hibberd

  • Associate
  • T: +44 (0)118 951 6765
  • Email me

View profile

The articles published on this website, current at the date of publication, are for reference purposes only. They do not constitute legal advice and should not be relied upon as such. Specific legal advice about your own circumstances should always be sought separately before taking any action.

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