The coronavirus (or COVID-19, to give it its proper name) has commanded business and mainstream headlines for over a month now.
On February 27, the Dow Jones Industrial Average suffered its largest point drop in history in reaction to news that the virus had spread.
To try to mitigate the economic downside of action taken to contain the spread of COVID-19, the U.S. Federal Reserve and Hong Kong’s central bank have both cut interest rates.
In addition, companies around the world are encouraging (or insisting upon) remote working, and discouraging (and/or preventing) many workers from going into the office.
In other words, the coronavirus is having a major impact on businesses around the world.
So, what does the coronavirus mean for international workers?
At the time of writing, there are still many unknowns about the coronavirus, and what companies and governments will do to protect themselves from it.
In the U.K., the FCSA (Freelancer & Contractor Services Association) recently published advice suggesting that, where workers are in or returning from an infected zone, it would be “prudent for them to work from home for a period of time”.
In Russia, Prime Minister Mikhail Mishustin has said that “foreigners could be deported from Russia if they test positive for the coronavirus”.
In the U.S., the Harvard Business Review (HBR) reported that “a just-completed Willis Towers Watson survey of 158 employers globally, over half of them multinational companies, found that most are implementing an array of actions to protect employees.”
In many cases these involve encouraging or requesting that work be completed from home.
Will all of this remote working affect payroll?
Put simply, if working from home means working in another country, this could affect you and your workers’ tax liabilities.
The good news is that, in many countries, this will not be an issue until the remote working period has extended beyond 183 days.
However, this is not always the case, and varies greatly depending on the country in which the project is located, the country in which the work is now being carried out (the remote worker’s home country) and what, if any, double taxation treaty is in place between those two countries.
To ensure that all parties are in full compliance with local tax and payroll legislation, as soon as remote working means working across an international or state border, expert advice should be sought immediately by both company and worker.
What steps can employers take?
From a compliance and regulatory perspective, an employer’s first responsibility is to ensure that both they and their workers are operating in full compliance with all applicable laws.
To confirm that this is the case, we would encourage any employer with remote workers across international or state borders to contact us, where we can complete an audit detailing the compliance levels of all parties in the contract chain.
Outside of their legal responsibilities, there are several steps an employer should take to mitigate the downside risk of coronavirus, and potentially gain a competitive advantage over those that are not taking action.
Below we have listed the top four steps employers can take to mitigate downside risk from the spread of coronavirus
Make remote working not only possible but seamless
Most modern companies already have infrastructure in place to enable seamless remote working.
However, some have gaps that can easily plugged by the multitude of collaboration tools now available.
Google, for example, announced this week that it was making the premium version of its workplace video chat tool free until July, to help businesses and schools working remotely due to coronavirus.
Review paid time off and sick leave policies
As referenced in the HBR article, the likelihood that increasing numbers of employees will be unable to work either because they are sick or must care for others means that companies should review their paid time off and sick leave policies now.
Policies that give employees confidence that they will not be penalized and can afford to take sick leave are an important tool in encouraging self-reporting and reducing potential exposure.
The HBR employer survey found that “nearly 40% of employers have or plan to clarify their pay policy if worksites are closed or employees are furloughed.”
Ensure clear and efficient communication channels
Clear and efficient communication can help to prevent dangerous rumours which, in some instances, can be as destructive as the virus itself.
Companies should ensure that they have up-to-date contact details, as well as nominated emergency contacts, for all personnel to enable effective communication.
Communication should be regular, internally coordinated, and include factual updates about infection control, symptoms, and company policy regarding remote work and circumstances in which employees might be excluded from or allowed to return to the workplace.
These communications should be issued by (and/or be vetted by) a nominated emergency response team, who should be carefully coordinated to avoid inconsistent policies being communicated by different managers or functions.
Test the business continuity plan (BCP)
As reported recently in the Financial Times, many banks are already testing disaster recovery sites in response to coronavirus fears.
The article states that “efforts by big global banks including Goldman Sachs, JPMorgan Chase, Morgan Stanley and Barclays are an escalation of business continuity planning that has already prompted them to segregate staff in Asian cities at the epicentre of the coronavirus outbreak.”
In many cases, what needs to be tested is that the infrastructure and processes indicated in the BCP are actually capable of handling a sudden mass remote working load.
For example, will home broadband capacity be sufficient for traders requiring high-speed connections to execute complex, time-vital, bookings?
The ACA Compliance Group recently published Guidance on Business Continuity and Disaster Recovery Planning for Coronavirus, which can be viewed by clicking here.
Should we panic?
As stated at the start of this article there are still many unknowns about COVID-19, and globally we are still in the containment phase.
While panicking benefits no one, careful risk mitigation and other preparatory steps (as outlined above) can help us all.
In short, now is the time to get the house in order. Don’t panic, but don’t delay either.
Casterrian IT Consulting helps businesses to expand their horizons by improving their IT infrastructure, ensuring that their systems are perfectly suited to their needs now, and flexible enough to adapt if those needs change.