- 10 minute read
- Last updated: 24th September 2019
With an effective global mobility programme, your organisation can derive commercial advantage from deploying the right talent to the right location at the right time. But with movement of people across multiple borders comes global mobility compliance risks.
This article covers:
- Global mobility compliance in a changing regulatory environment
- Business travellers
- Duty of care
- Payroll & tax
- Data & reporting
- The future for global mobility compliance
For multinationals looking to enhance their global mobility compliance and reduce risk exposure, the challenge is finding a cost-effective way of meeting their legal requirements while taking full advantage of the global stage.
While compliance strategies will be as unique as the mobility programme itself, there are several common areas of risks which organisations should take into consideration.
Global mobility compliance in a changing regulatory environment
Regulations around the world are constantly changing. While global mobility compliance demands an understanding of current regulatory obligations, it also means identifying and preparing for new and emerging changes in local regulations and rules that have the potential to impact employee mobility in the short or long term.
Regular assessments should be carried out in regions where your workforce operates to understand imminent or potential legislative and environmental changes, to identify who in the organisation will be affected by the changes (such as overseas assignees and business travellers) and what the organisation needs to do to support those affected and to comply with the changes.
This could mean adapting organisational processes, systems or protocols either in the region, at headquarter level or across the organisation, and may necessitate training of relevant personnel.
Business travellers pose a challenge to multinational organisations since their movements are often unmonitored and undocumented.
In practice, the risk typically emanates from company policy, whereby only trips of more than 60 days trigger global mobility protocols. Organisations must strike a balance between expecting employees to take responsibility for their movement while supporting them to avoid issues with travel.
While employees may revisit the same destinations and consider these stays too short to raise any compliance issues, the reality is that such trips can present a number of risks in areas such as tax and immigration.
One area of continued change is what constitutes ‘permissible activity’ for business visitors. National policy and border discretion differ from country to country, requiring continued monitoring of local rules to avoid issues at the border.
International business travellers should be provided with immigration advice and assistance from their employer. If your organisation is not proactively supporting its business travellers, it is easy to fall short of global mobility compliance requirements.
You should also introduce travel policies that fill any gaps in your existing protocols. Employees should be required to tell the organisation where they are travelling, for how long, and for what purpose, in advance of their visit.
An integrated, collaborative workflow between departments such as HR, tax, and legal should help facilitate seamless business travel that complies with global rules.
Global mobility compliance: Duty of care
Your duty of care towards employees continues while they are working overseas. To ensure their personal safety, it is always best to overprepare than underprepare.
As standard, most employers offer their employees remote medical advice and assistance in the event they are injured or become unwell.
Protection should also be given against more serious environmental risks, such as disease outbreaks or storms, which vary depending on where in the world the employee is assigned.
An effective global mobility programme should include location assessments to ensure your organisation clearly understands the local environmental risks facing your employees, and have protocols and resources in place to ensure their safety while in the region.
Pre-travel training will be critical to advise travelling employees and assignees of instructions and protocols to follow to stay safe while overseas, and where relevant to provide information about repatriation procedures in the event of an emergency.
Maintaining contact and providing real-time updates will also allow the organisation to notify employees about new and potential risks in the area.
Payroll & tax
A pervasive challenge facing globally mobile organisations is payroll and tax compliance. Cross-border work can trigger complex tax liabilities and payroll arrangements, which rely on accurate and up-to-date data about employees’ movements, earnings and expenses.
Collaboration between departments is essential, enabled through integrated and automated systems and workflows that improve process efficiency and accuracy.
Software innovations are providing employers with better solutions for managing the remuneration aspects of global mobility compliance. However, the impact of any tech solution will be determined by the quality of the data available, and the extent to which employees are required to adopt new processes and support any new workflows.
Data & reporting
Effective global mobility compliance relies on accurate data and reporting. But data regulations across the globe, such as the General Data Protection Regulations (GDPR), continue to change and become more stringent.
When personal data moves from one jurisdiction to another, the organisation must ensure full compliance with the relevant data regulations specific to the regions concerned. This generally involves meeting standards and duties in relation to the type of data that is captured, how and where data is stored and how long data is stored.
Technology such as employee tracking and expense management tools help to ease the administrative burdens on global mobility teams while improving the accuracy and speed of processing but they also raise concerns about cross-border data transfers. Reporting should be in real time with safeguards in place to protect data security, quality and integrity.
Global Mobility Compliance: Conduct
Cultural norms and criminal and civil laws vary across the globe, and employees may not always be aware of what constitutes legal or acceptable behaviour within a specific country or region.
Organisations should develop a company-wide policy for how employees conduct themselves when they are representing the business. Cultural awareness training can also be extremely beneficial for employees and their families on overseas assignment to support with adapting to local customs and behaviours and to educate on local laws.
The future for global mobility compliance
Global mobility compliance continues to present major challenges for organisations operating across borders and jurisdictions.
Global mobility compliance requires organisations to take a consistent and proactive approach to risk management in order to achieve commercial goals when managing a globally mobile workforce.
DavidsonMorris’ specialist global mobility consultants provide expert guidance to employers on managing the compliance risks associated with operating an internationally mobile workforce.
We understand the commercial drivers behind mobilising workers and the need to ensure compliance without impacting return on mobility investment.
We work with senior management teams, HR and mobility professionals to develop strategies that ensure effective compliance risk management while supporting delivery of the organisation’s global mobility objectives.