The Internet has without a doubt been a key enabler for much of today’s economy. From simply accessing information at a distance, to ordering and receiving your groceries in the comfort of your home, it has revolutionized the way we think and act.
It has also opened up new possibilities for how we work. The classic 9-5 office job is no longer the gold standard. We do not have to be physically present every day with our colleagues in order to correctly perform our duties. Employment law is catching up with the notion of remote working, and in some countries there are still some grey areas. However, we should not let the uncertainty of the law put us off pursuing a career status that can be as rewarding as it is flexible. Wouldn’t that be boring? By the way, uncertainty does not mean illegality.
What is a remote worker? Simply put, it is a special status afforded to loyal employees who have been lucky enough to find a compassionate manager. Actually, it is not. It is a solution to a firm’s particular needs where physical location is not important. With a laptop, internet connection, flexibility, and good old brain power, we can do many things remotely. Beware though, the work dynamics of remote working are different to those of being in the office.
How to become a remote worker? The first thing to consider is your personal setup whereby you need to be legally entitled to live and work in your host country. Then you will need to decide which employment relationship is best for you: a number of legal options are available, read our case study to better understand them. For the purposes of simplicity, we will assume in what follows that you are opting for company creation, which is the most flexible. Then you “just” need to find jobs. But let us first decompose the steps you will need to take.
Residence permit
As a person you will need to possess the correct visa to be able to live in your host country, and sometimes even prove you have sufficient monetary resources. If you are an EU citizen then you have the right to live, and to work, more than three months in another EU country. In Switzerland it is more difficult (by no means impossible) for non-EU nationals to live in Switzerland, compared to EU nationals. The United Kingdom at the time of writing is set to leave the EU, but does not have anything specific in place for afterwards; nevertheless we expect it to become noticeably more difficult for non-UK citizens to reside in the UK.
Company creation
Creating your own company in the country of residence will give you the flexibility to act as a business in its own right. On the flip side, you will need to pay social security charges for your employees (yourself) as well as tax on profits, accountants, and in many cases professional indemnity insurance. Keep in mind that a company can take one of a handful of different legal forms, each with its own rights, obligations, and costs. If you are in this for the long term, it is usually economically more efficient to work via your own company. Social security charges in Europe are perceived to be high, but in most cases you will be well covered in cases of accident, illness, maternity and so on. The UK has less protection and consequently lower social security charges.
Find work
Whether you look on job boards or use personal connections, finding work as an independent is a much more transparent process. The best thing about it is that it is low-risk for the employer. In Europe the typical notice period to terminate the work relationship of a full-time employee is three months, assuming they have been in the company for a minimum of six months. Even then, there are legal conditions and financial compensations that need to be respected. Independent workers and contracting companies have a typical one-month notice period. There are no restrictions for non-EU companies hiring EU companies, and thereby their employees. However, in some regulated industries like financial services and telecommunications, there might be restrictions on the type of work allowed.
Set your daily rate
As a remote worker via a company, you will be taking a greater risk by forfeiting the better employment protection afforded to full-time employees. You also have business costs to cover. This greater risk should be compensated by a distinctively higher daily rate than the equivalent salary of a full-time employee. It is counterbalanced by a lower risk for the employer, but don’t forget money is a finite resource for most smaller firms. Bear in mind also that larger firms with more international presence have more options. Consider for example a company based in the US with operations around the world, and looking for someone to cover the French market. The following options are available: someone local in the US; someone based in Montreal, Canada; someone in France; someone in Nepal. Each option has its pros and cons, not just in terms of daily rate, but in terms of quality, cultural understanding, and availability. It is up to you to know your worth and balance it against the firm’s options. Beware of under-selling yourself and setting a precedent.
Double and special taxation
EU citizens working in other EU countries should in most cases not have a problem with this. Problems may arise if your nationality makes you liable for double taxation. For example, US citizens working in Europe, or UK citizens working in South Africa. This is a very delicate area and one that needs good planning, otherwise you could find yourself paying tax twice on your earnings! Each jurisdiction has very specific tax law, like for example, in the UK there is no tax on assets, but in France and Switzerland there is, but each country calculates it differently.
Make your cash flow
Make sure you are billing your clients in good time, and follow up swiftly if something feels uncomfortable. The quicker you receive your money, the quicker you can pay the authorities what they are due, like social security, taxes, and so on.
Once you are up and running, you will have contract renewals to tend to in addition to prospecting. You will also experience ups and downs, but actually that’s what makes it exciting as a life choice. Nevertheless, always keep your mental health in good shape, and consider for a moment how critical time management and discipline are for remote workers.
As mentioned briefly earlier, do bear in mind that creating your own company might not be the right choice for you. Other employment relationships are possible, and might better suit your lifestyle. Our case study explains the pros and cons. Remember, a little flexibility on both your or the employing company’s side often can mean the difference between being hired or not!
Most of us spend too much time on what is urgent and not enough time on what is important .
Abeona can accompany you through all of these steps, so that you are in full control at all times. In particular we have strong experience in small business financial planning, and negotiating contract rates with employers. If you are a US citizen or working for a US company, we can help ensure compliance with the laws on both sides of the water, and defuse any culture clashes. Laws evolve over time and are susceptible to change suddenly and adversely, so always make sure you are acting on the freshest information.
