Digital Nomads

By Linda Olejniczak, courtesy of SBAM Approved Partner ASE

Since the Covid-19 pandemic hit, remote work has been the biggest trend impacting the way businesses operate. There is one growing group of workers: digital nomads. These are people who embrace a location-independent, technology-enabled lifestyle. Unlike regular remote workers, who tend to stay in one place or shuttle back and forth between their home and a vacation retreat, digital nomads travel and explore the world while working.

Few organizations have formal policies and programs for this workforce. Digital nomads are off the grid, literally and figuratively. Having digital nomads on the payroll can leave firms open to a variety of tax, regulatory, and legal risks. In addition, since many digital nomads travel without their firm’s knowledge, their employers may wind up breaking employment laws and regulations without any awareness that they are doing so.

Creating a digital nomad policy is critical for organizations to get in front of this trend.  Here are some key points to include in the policy.

Companies should draw up an agreement that defines the terms of the approval process and the telework arrangement. Other terms, such as limiting the amount of time nomads can spend in any one location and listing “no-fly zones” — places that are off-limits because of their compliance rules and regulations — can greatly reduce the risk that the nomad will run afoul of local legal, tax, or compliance issues.

For the sake of maintaining productivity and open team communication, you need to set clear guidelines as to when employees must be available to work. Telecommuters are expected to effectively accomplish all their regular job duties regardless of the work location. Specific expectations for the arrangement should be summarized clearly and reviewed often.

Telework arrangements do not have to result in duplication of office equipment. Determine if the employee shall utilize equipment they already have or will they use their own equipment. 

Employees need to understand that they are required to comply with all timekeeping and overtime regulations. The agreement is not a contract of employment, does not provide contractual rights to continued employment.  It does not alter or supersede the terms of the existing employment relationship.

Wandering workers who move abroad for personal reasons pose tough challenges to their employers, mostly under the local law of the host country where they end up working. Long-term international telecommuting can be particularly complex and expensive for organizations.

Organizations should highly consider launching a process that requires telecommuters to get employer permission before moving out of the jurisdiction.  Create a policy that defines:

Our workplace has changed.  Employers need to adapt.  By defining a policy that clearly outlines your expectations, important rules, and procedures for best practices for employees to follow will ensure a successful transition to employing digital nomads.