Resilience sector insights: Global mobility

At a high-level, we support businesses that have employees who work cross-border.  We work to ensure they understand their reporting obligations, paying tax and social security where employment duties are performed.

No two days are ever the same.  Our client base covers a range of industry sectors, and we deal with a wide variety of queries, all of which are people related. For a business, the issues are often at the corporate level; but we interact closely with their people and are cognisant of the personal impact on the employee, and potentially their family of cross-border working.

For several decades, cross-border working was undertaken as part of a formal assignment, fixed term with a clear end date. Long standing global mobility policies were also in place to support these moves and provide guard rails for the business, managing risk.

In the last 15 to 20 years, we began to see the rise of the short-term business visitor; individuals working across multiple jurisdictions as part of their ordinary role. This was driven by a cheap short haul flights and the fast pace of globalisation.

When COVID hit, the support we provided to our clients had to change rapidly – global mobility as we knew had changed; We were supporting businesses with employees stranded overseas due to lockdowns, or employees who had made the decision to move and work abroad during the pandemic for personal reasons. These moves were employee driven, creating a different dynamic.

In what we all hope is a post COVID environment, we are seeing an increase in people wanting to be globally mobile and to experience other cultures as part of their career. Formal assignments still take place but with a lighter, less costly policy in place short-term business visitor numbers appear to have bounced back and of course global remote working arrangements are here to stay.

And it is this ability to work remotely and remain connected in another jurisdiction, allied to a new generation entering the workforce, that has seen ‘the balance of power’ move towards employees. Global companies have always had to operate cross border, but 10 years ago those employers held all the cards in terms of the policy and scope of a move. Now, global mobility is often employee led.

Day to day we see scenarios where an existing employee decides they wish to work overseas. Or, due to a shortage of talent, employers may find the right person for a role based in Europe - but that person lives on the other side of the world. Arrangements are then put in place for that individual to visit the HQ 3 or 4 times a year, whilst the rest of the time they may be fully remote.

The challenges this creates has driven a change to our approach in supporting clients and their employees.

I feel strongly that COVID made us realise that the status quo can change, we should not take the freedom to move globally for granted. During that period, the UK exited the EU (European Union), but it was only following the lifting of COVID related travel restrictions that UK businesses realised the impact for their people and search for talent.  For many years as part of the EU, we did not need to consider right to work status, or business visas to move within Europe. Now, I see immigration as a key risk.  Businesses are still not fully aware of their responsibilities and employees are unsure of how much time they can spend in the EU – worrying if a holiday or another business trip to complete a project breach a threshold.  I have seen employers start to look at which of their UK employees hold EU passports and vice-versa, when considering who can undertake a particular project.

Opportunities are alive for those businesses who focus on tracking their employees cross-border working and ensuring that their employees understand thresholds and personal obligations.  We support our clients with our TrackGlobal platform.  It provides up front risk assessments for immigration, tax, social security and corporate presence.  Being advised and understanding the risks is the key.

Looking further ahead, political change in the UK, the EU and in the US, is likely to lead to legislative change, where new governments want to make an impact. I anticipate that immigration rules may become stricter, and it could become more difficult to retain and attract talent to your country from overseas in years to come.

Why do I think this when the world has been becoming more globalised? - If you consider the current political rhetoric around immigration, there is a potential for countries to become more isolationist.

Ten years ago, US businesses were outsourcing all of their manufacturing overseas. Now we are seeing electronic chip manufacturing being ‘on shored’ in the US. We are seeing more countries moving towards self-sufficiency, following events like the Russian invasion of Ukraine and the resulting impact on supply chains.

With future generations, where remote working opportunities are expected, as well as trends in technology and generative AI, we are going to be looking at a vastly different view on office work, or even work itself. The challenge is for employers to ensure they are offering greater flexibility, to remain competitive.

We ensure that businesses are fully appraised of the current legislative landscape, and potential future tax and immigration legislation. as well as the impact of these potential changes, so they can adapt accordingly.

From a cost perspective, we work to ensure businesses are effectively employing individuals across borders.  We do this on an engagement-by-engagement basis, driven by our client’s requirements.

UK to US and vice-versa, remains the biggest swim lane for mobility. With the Forvis Mazars partnership, we are well positioned to support businesses with our enhanced presence in the US.

Forvis Mazars National Resilience Contact – Dan Breger, Associate Director, Management Consulting

Forvis Mazars Global Mobility Contact - Ainsley Wainwright, Director, Global Mobility