The pandemic has drastically changed the landscape of how and where people work. "Hybrid working" has emerged as a term to describe the, now wide-spread, practice of allowing employees to work remotely for a portion of their contracted hours, and some employers are giving up office premises altogether. Businesses have also increasingly seen employees seeking to work from abroad, which has presented a number of challenges.There is a perception that the UK's legal framework may be lagging behind in how it accommodates these new arrangements. As part of a wider review in to how the trends of global workplace mobility and distance working have evolved, the UK Government has opened a consultation on hybrid and distance working to address this (Review of hybrid and distance working - Call for evidence - GOV.UK).
Led by the Office of Tax Simplification (OTS), this is a "call for evidence". The OTS are seeking responses to a number of questions from a range of respondents (including employers, employees and self-employed individuals who have seen their working arrangements change), around three broad themes:
- Cross-border working (as it affects UK companies with overseas-based employees, excluding formal secondments, and employees of overseas employers working in the UK);
- Hybrid/distance/home working practices in the UK; and
- The position of self-employed individuals who spend part of their working time in another country.
The Government's stated goal is to get a sense of what is happening in the market, looking at:
- working across international borders, and what that means for things like tax, social security, tax residence, and permanent establishment;
- how accommodation, travel, and other expenses work in a hybrid world, including who will pay and whether permanent workplace rules make sense;
- application of short term business visitor rules, overseas workday relief, and modified payroll;
- the treatment and impact on pension contributions and share schemes; and
- the risks or otherwise of creating permanent establishments or even changing corporate residence.
Respondents are asked to submit their observations on trends, detail on how working arrangements have changed (comparing the pre-pandemic period, arrangements during the pandemic and the position as we are now emerging from the pandemic), how employers' policies and procedures have changed, and what tax-related challenges employers and employees have encountered.
Respondents are invited to respond to as many questions in the consultation as they like.
While the consultation can be responded to by anyone in any position, there is an additional focused survey for employees and the self-employed (Office of Tax Simplification - Hybrid and distance working review).
Fieldfisher has been supporting clients with evolving working arrangements since the early days of the pandemic, including working through the tax, immigration and employment law issues arising in relation to employees working from abroad during this time ("COVID expat"), advising on information security and business protection questions in connection with remote working and helping clients develop hybrid working models.
The consultation is open until 25 November 2022. Fieldfisher plans to submit a response, and we are keen to speak to clients about what you have found has worked or not worked in your business, what trends you are seeing, and what the biggest challenges you have encountered are. If you are particularly affected by these issues, we would also encourage you to take a look at the consultation and consider submitting a response. This is an opportunity to give the Government a realistic insight in to the current hybrid and cross-border working landscape, which in turn should hopefully lead to laws, policy and guidance that better reflect how companies and individuals operate now and how they might wish to operate in the future.
If you would be happy to speak to us in connection with the consultation, or to discuss any of the risks and issues in relation to hybrid/remote working or employee global mobility please reach out to a member of the EPIC team.
With special thanks to Trainee Solicitor, Mark Linnane, who contributed to this article.
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