International Remote Working: Guide for UK Employers

International remote working allows employees to perform their duties from a location outside their usual country of employment. As work practices evolve, more organisations are offering such flexibility to accommodate employee preferences, support global operations or access talent in different locations. While this arrangement has clear benefits, such as enhanced employee satisfaction and cost savings, it also introduces significant challenges for UK employers.

 

What is remote working?

 

Remote working refers to various arrangements that allow employees to perform their duties outside traditional office settings. These arrangements differ based on location flexibility and how work is structured, each with unique benefits and challenges for employers and employees.

 

Flexible Working

Flexible working is a broad term describing arrangements where employees have pre-agreed flexibility over their location, hours, or patterns of work. When implemented effectively, flexible working policies can significantly enhance employee satisfaction and deliver value to the organisation.

 

Working from Home

Working from home enables employees to perform their roles from their private residence rather than a business premise. The pandemic accelerated this arrangement, requiring employers to support remote operations effectively. However, risks such as employee wellbeing, health and safety compliance, and IT security remain key considerations. Legislative discussions around a legal right to work from home could make this arrangement a lasting feature of modern employment.

 

International Remote Working

International remote working involves employees carrying out their duties from another country. While offering access to global talent, it introduces added risks in compliance areas such as tax, immigration, and payroll, alongside HR challenges like team integration and performance measurement.

 

Working from Anywhere

This arrangement permits employees to work from any location, offering maximum flexibility. While appealing to workers seeking freedom to travel, it often presents significant risks for employers, particularly in managing international compliance. It is generally more suited to freelance workers than traditional employment arrangements.

 

Working Virtually

A virtual team operates and connects online, comprising members from different locations—whether working from home, in-office, or abroad. While this structure allows organisations to assemble diverse talent without travel constraints, employers must ensure remote team members are not excluded from developments or informal interactions that occur among co-located colleagues.

 

Hybrid Workers

Hybrid working involves splitting time between different work locations, such as part of the week in the office and the rest working from home. This arrangement has gained traction post-pandemic, as employees seek flexibility and reduced commuting. Hybrid working can also extend to combining traditional overseas assignments with remote working periods, particularly where compliance issues or travel restrictions affect assignment feasibility.

 

Virtual Assignments

Virtual assignments are an alternative to traditional short- or long-term international relocations, allowing employees to perform overseas roles remotely. This model is especially relevant where relocation is impractical due to compliance, cost, or travel restrictions.

 

Challenges of international remote working

 

Managing international remote working arrangements can present significant challenges for employers. Key areas of concern include legal compliance, taxation, employee welfare, and practical implementation. Addressing these issues thoroughly is essential to avoid risks and ensure successful outcomes.

 

Immigration

 

Immigration is a central consideration for employers managing international remote working. Employees must have the legal right to live and work in the country where they intend to reside. This often involves securing appropriate work visas or residence permits, which may vary depending on the host country’s immigration laws. Employers also need to consider whether dependants accompanying the employee have rights to live in the country, access healthcare, or attend school. Failure to address these requirements can result in delays, fines, or legal repercussions for both the employee and employer.

Post-Brexit, the movement of UK employees within Europe has become more regulated, with additional paperwork and visa requirements now necessary for many countries. Employers should stay informed about bilateral agreements and the evolving immigration landscape to support employees effectively. Transparency in communication about responsibilities and timelines is essential. Immigration considerations should also address any potential impacts on employees’ long-term goals, such as applications for permanent residency or citizenship. By ensuring compliance and offering practical support, employers can facilitate smoother transitions for employees and their families.

 

Employment tax and social security

 

Taxation and social security obligations are often triggered when an employee works in a country other than their usual place of employment. Employees may become liable for income tax and social security contributions in the host country, even if they continue to be paid by their UK employer. The specific thresholds and rules governing these liabilities vary between countries, requiring employers to understand local regulations.

Tracking the time employees spend working abroad is essential, as even short-term stays can create tax and social security obligations. Additionally, employers must consider potential double taxation issues, where both the UK and the host country claim tax on the same income. Tax treaties between countries can help mitigate this, but understanding their application requires expertise and vigilance.

Payroll systems also need to adapt to ensure compliance. Unlike formal expatriate assignments, remote workers may lack structured policies to manage tax and social security contributions. Employers should establish clear processes for handling these obligations, working closely with legal and tax advisors to avoid penalties or non-compliance.

 

Health, safety and wellbeing

 

Employers remain responsible for the health, safety, and wellbeing of employees working remotely, even when they are based in another country. Risk assessments should extend to the employee’s remote work environment to ensure it meets basic health and safety standards. This could involve assessing ergonomic setups or providing equipment to reduce the risk of injury.

Cultural and social factors also play a role in employee wellbeing. Working abroad may lead to isolation or adjustment challenges, particularly if the employee is unfamiliar with the local culture. Employers should offer support to help employees settle into their new environment and maintain their mental health. Regular check-ins and access to employee assistance programmes can provide vital support.

Emergency preparedness is another consideration. Employers must ensure that employees know what to do in case of local emergencies, such as natural disasters or medical issues. Offering adequate health insurance and clearly communicating support channels helps employees feel secure while working internationally.

 

IT, data protection and cybersecurity

 

IT infrastructure and data protection are crucial for enabling international remote working. Employers must ensure that employees have secure access to company systems, often through encrypted devices and virtual private networks (VPNs). Cybersecurity risks increase when employees work from locations with less secure internet connections, making it essential to implement robust safeguards.

Data protection laws in the host country may differ from UK GDPR requirements, which can complicate compliance. Employers must ensure that personal and business data handled by employees abroad is processed lawfully and securely. Training employees on cybersecurity best practices is equally important to prevent breaches or misuse of company data.

Employers should also provide remote IT support to address technical challenges employees may encounter. Ensuring employees have access to reliable tools and software is critical for productivity and maintaining operational continuity.

 

Team integration and communication

Effective communication and integration are essential for teams with international remote workers. Employees working across borders can feel isolated or excluded from discussions and developments happening in the office. Employers should ensure remote employees have equal access to information, opportunities, and team-building activities.

Time zone differences present an additional challenge. Scheduling meetings at mutually convenient times and offering asynchronous communication tools, such as shared documents or recorded updates, can help maintain inclusivity. Employers should also encourage virtual team-building exercises to strengthen connections between remote and on-site staff.

 

Cost management

 

Managing costs is a vital aspect of international remote working. Employers should develop clear policies outlining what expenses will be covered, such as relocation costs, coworking spaces, or additional equipment. Currency exchange rates and payment methods must also be considered, particularly when employees are paid in a different currency.

Insurance is another key cost consideration. Employers should evaluate whether existing liability, travel, or health insurance policies adequately cover remote employees working abroad. Comprehensive planning can help organisations balance employee needs with budgetary constraints while maintaining compliance.

 

Compliance monitoring

 

Ensuring compliance with local laws and regulations is an ongoing responsibility for employers managing international remote workers. Regular audits of payroll, tax, and immigration records help identify and address potential issues before they escalate.

Compliance risks can also arise from employees working informally across borders without the organisation’s knowledge. Employers should establish tracking systems to monitor where employees are working and for how long. Clear reporting processes and the use of technology to track time and location are essential.

Engaging local legal or tax experts can help employers stay up to date with the regulatory environment in the host country and address emerging risks proactively.

 

Exit strategies and contract termination

 

Managing the end of an international remote working arrangement requires careful planning. Employers must address how to transition employees back to their home country or an alternative location, ensuring compliance with local laws governing termination or relocation.

Clear communication about the end of the arrangement is essential, including timelines, responsibilities, and any financial implications. Employers should also evaluate whether a return to the office or a hybrid model is a viable option for the employee.

In cases where the employment contract must be terminated, organisations should follow both UK and host country regulations to avoid legal disputes. Providing support, such as career counselling or assistance with the relocation process, can ease the transition for employees while protecting the organisation’s reputation.

 

Practical Considerations for employers

 

Scenario Planning

Organisations must clarify the scenarios under which international remote working will be permitted. Clear policies should outline why the business supports or restricts such arrangements and the risks and benefits associated with them. For instance, international remote working may be restricted to specific roles, regions, or timeframes to minimise risks.

 

Defining Scope and Limitations

Employers should define the scope of international remote working clearly. For example, virtual assignments may be limited to specific countries or regions, and their duration may be capped. Adding precautionary clauses to existing policies, such as work-from-home agreements, can prevent misunderstandings about cross-border work requests.

 

Compliance Gaps and Monitoring

There is a risk of remote workers “flying under the radar,” particularly when they work informally across borders. This can result in unforeseen tax, social security, or immigration liabilities. Employers must establish robust monitoring systems to ensure compliance with local laws and address potential marginalisation of employees who may struggle with remote working.

 

Alternatives to Virtual Assignments

If virtual assignments are not feasible for a particular role or scenario, alternative arrangements should be explored. For example, short-term relocations or hybrid arrangements could meet both employee and business needs. HR departments should adopt a global talent management approach, assisting employees with relocation and broader career development opportunities.

Encouraging Strategic HR Involvement

International remote working should be addressed as part of a broader strategy for managing a globally distributed workforce. HR teams should play an active role in advising on compliance, supporting employees, and optimising global talent deployment. A collaborative approach ensures that international remote working aligns with both organisational objectives and employee wellbeing.

 

Need assistance?

 

Employers must deal with multiple considerations when implementing remote working; not all jobs can be performed effectively on a remote basis, and where it is possible, terms will need to be agreed with the worker which may require changes to the employment contract, job descriptions, processes, workforce support, and management mindsets. Communication with your workforce and compliance with your legal obligations will be critical.

DavidsonMorris advises employers on all aspects of international remote working. With expertise in immigration, HR, employment and global mobility, our specialists provide a comprehensive solution encompassing the legal and practical challenges of adopting and adapting virtual working arrangements to optimise workforce performance and morale. For specialist advice for your organisation’s specific needs, contact us.

 

International remote working FAQs

 

What is international remote working?

International remote working refers to an arrangement where employees carry out their work duties from a location outside of their usual country of employment. It allows greater flexibility but introduces legal, tax, and compliance challenges.

 

Do employees need visas for international remote working?

Employees may require a work visa or residence permit to legally live and work in another country. Employers must ensure these are obtained before work begins to avoid legal complications.

 

What tax obligations arise for international remote working?

Employees working abroad may become liable for income tax and social security contributions in the host country. Employers must also ensure compliance with any corporate tax obligations triggered by the arrangement.

 

What are the risks of international remote working for employers?

Risks include non-compliance with local employment laws, tax and payroll complexities, cybersecurity vulnerabilities, and the potential for employee isolation or disengagement.

 

Can employers set limits on international remote working?

Yes, employers can define policies that set boundaries, such as limiting remote work to specific countries, capping the duration, or requiring prior approval for such arrangements.

 

How can employers support employees working internationally?

Providing clear policies, robust IT support, regular communication, and access to health insurance and wellbeing resources can help employees adapt to working abroad successfully.

 

What should a policy for international remote working include?

A policy should address eligibility, duration, approved locations, tax and immigration compliance, cybersecurity requirements, and the support available to employees. Clear communication of expectations is essential.

 

Glossary

 

 

Term	Definition
International Remote Working	An arrangement where employees perform their work duties from a location outside their usual country of employment.
Work Visa	A legal document that allows an individual to live and work in a foreign country for a specified period.
Tax Residency	The status of being liable to pay taxes in a specific country based on time spent or income earned there.
Permanent Establishment	A business presence in a foreign country that can result in corporate tax liabilities for the employer.
Social Security Contributions	Payments made to support public services such as pensions and healthcare, often required in both home and host countries during remote work.
Payroll Compliance	Ensuring that employee payments adhere to local tax, social security, and legal requirements in the host country.
GDPR (General Data Protection Regulation)	EU regulation governing the handling of personal data, which must be considered when employees work internationally.
Remote Work Policy	A formal document outlining rules and expectations for employees who work from locations other than the office, including internationally.
Virtual Assignment	A work arrangement where an employee performs duties remotely, often from another country, without relocating permanently.
Global Mobility	The management of employees working internationally, including relocations, assignments, and compliance.
Cybersecurity	Measures taken to protect data and systems from cyber threats, particularly important for remote workers using foreign networks.
Immigration Compliance	Ensuring that employees working abroad meet the legal requirements to live and work in the host country.
Wellbeing Resources	Support provided to remote employees to address mental health, social adjustment, and physical health while working abroad.
Time Zone Management	Strategies to coordinate work schedules effectively across different time zones in international teams.