Hybrid and Remote Workforce
As borders reopen and families reunite, employees who have gotten used to remote work over the past months are starting to contemplate the possibility of doing that while overseas.
Covid has accelerated digitalisation across almost all industries, which enabled employees to work away from the office during the pandemic. For years, companies have been engaging freelancers based overseas or outsourcing certain functions, including call center and technology support services, to workers abroad. So cross border hiring is not new. However, COVID-19 has forced industries to digitalise most of their operations, resulting in remote work being now viable for a lot more job functions — prompting more workers to embrace it for various reasons. This means that terms of employment are also changing. For instance, medical and hospitalization benefits may not be available in an overseas setting, and employees will have to agree to be responsible for their own insurance.
While remote work becomes more commonplace, there are some laws and policies governing areas such as taxation, work benefits, company-employee relationships and foreign manpower that would need further consideration.
- Attraction and retention of employees: Offering Flexible Work Arrangements (FWAs) like remote working might make employers more attractive as the demand for such arrangements increase. According to the HBR Great Resignation piece, many employees prefer working from home.
- Greater work-life balance and increased productivity: Employees may be able to enjoy a better work-life balance. The decrease in commute time means that employees have more time to rest and recharge, increasing work productivity. Those with young children or elderly parents will be able to better perform their family responsibilities too. Happier employees are more productive.
- Manpower crunch: The option of employing those who are unable to commit to office-based work due to family responsibilities or other reasons. With more options for remote work, there is a larger manpower base and talent pool. Additionally, there are options to hire contract workers-which depending on function can be financially beneficial for the business.
- Better emergency preparedness and transition: Implementing FWAs will allow your company to quickly commence business continuity plans during times of crisis. The infrastructure and experience required to efficiently execute remote working is already set up and business as usual can continue
- No need for physical space: Not only does this help you save on the capital costs of setting up a business, it also reduces the amount of money spent on overhead costs such as electricity, water and rent.
Contractual agreements should always be in place and in this case for remote work, a contract of service that defines the employer-employee relationship becomes more important to not blur lines.
According to the Ministry of Manpower (MOM), an employment contract governed by Singapore law must include certain Key Employment Terms (KETs). These include:
- the employee’s job title
- main duties and responsibilities
- basic salary
- daily working hours
- leaves and bonuses.
To minimize disputes on the agreed terms and conditions, MOM recommends that the contract be in writing.
What should be the governing laws of the employment contract?
Understanding the governing law of a contract is important because the laws of different countries may lead to different legal outcomes with respect to the same contractual terms.
A contract to be performed in Singapore should ideally designate Singapore law as its governing law, with the Singapore courts as the court of choice.
Where the employee is working outside of Singapore, the governing law of the contract would depend on a mutual agreement between the employer and the employee as to which country’s laws should govern the contract. This could be the Employment Act (if Singapore law is adopted) or the overseas country’s employment regulation.
In the event of a dispute as to what the governing law of the contract is, it will be for both parties to present their case on which country’s laws should apply to the contract and why.
However, employers of overseas employees might want to keep in mind that even if Singapore law is to govern the employment contract, the terms of the contract should not infringe the local laws of the country that the employee is working in.
Do foreign remote employees need to apply for a work pass?
Remote employees do not need to apply for a work pass to work for Singapore companies if they are not physically based in Singapore. However, if the foreign employees will be stationed in Singapore, then they will need to have a valid work pass.
Tripartite Standard on Flexible Work Arrangements (FWAs)
In recognition of the benefits that FWAs such as remote working bring to both employees and employers, and their role in creating a supportive and conducive work environment, the Tripartite Standard on Flexible Work Arrangements was launched in 2017.
This Tripartite Standard on FWAs will ensure that employees are better able to benefit from FWAs, while addressing their concerns. For example, the Tripartite Standard requires employers to inform employees on the availability of FWAs, the company’s FWA policy and how they can apply for them.
Adoption of this Tripartite Standard is optional, but doing so may increase the attractiveness of the employer to job applicants. Employers who wish to adopt the Tripartite Standard on Flexible Working Arrangements may refer to this page for more information.
Considerations for Organisations that Wish to Hire Remote Employees
Technology is the main enabler for remote work to be able to take place. As such, organizations might want to decide on providing remote employees with necessary equipment such as laptops or mobile phones.
Investing in remote desktop sharing software might be useful in resolving technical difficulties faced by remote employees in a timely manner. Additionally, issues of data protection and security might be of concern. Having company equipment and remote solutions might be crucial to security.
Coming up with a clear communication plan and scheduling regular check-ins with your remote employees are also important in ensuring they are on track in terms of their work progress.
Given the importance of the employment contract in defining employer-employee relations, employers may consider engaging professionals in working out all things employee- related. In the employment contract to relevant employee benefits, all these details need to be in accordance with the intended governing law of the contract.
Tomorrow’s workplace will feature a flexible work environment where employees can decide where and when they work, they can have some say over their job descriptions and career paths.