The rise of remote work has fundamentally transformed how organisations operate, with employees increasingly seeking the flexibility to telework from anywhere in the world. In the ongoing war for talent, employers are also more inclined to allow such flexibility in order to attract the right profiles, as offering remote work arrangements can be a decisive factor in being recognised as an employer of choice.
Whether it’s occasional remote work due to unexpected circumstances or structural arrangements allowing employees to work from abroad regularly, employers must carefully consider the legal implications before granting such requests. This newsletter provides a high-level overview of the key employment-related considerations in this respect. Note that we’ll mainly tackle this topic from the perspective of a Belgian employer but that the principles can be largely applied to employers located in other territories as well.
Telework under Belgian labour law
As a Belgian employer, a first step is determining which legal framework applies to the employee’s teleworking. This depends on the circumstances and the degree to which the telework is planned in advance, as Belgian law distinguishes between two types of telework:
- Occasional telework refers to work performed outside the company premises on an incidental and non-regular basis typically in cases of force majeure or personal circumstances such as a car breakdown, a national train strike or – when talking about remote working abroad – e.g. being stuck in Dubai due to the ongoing hostilities in the Middle East. Employees must request occasional telework in advance to the employer, who can accept or refuse this request.
- Structural telework, by contrast, is performed regularly and systematically outside the company premises and must be formalised through a written agreement or addendum to the employment agreement. This written agreement or addendum must specify several mandatory elements, including the frequency of the telework, the employee's availability requirements and crucially, the location where the telework will be performed.
Applicable social security
A key consideration when employees telework abroad, irrespective of whether the telework is occasional or structural, is the applicable social security scheme. Indeed, if employees of a Belgian company (partly) telework from abroad, this might trigger local social security subjection in these countries, as an employee is generally subject to the legislation of the country they work in.
Exceptions exist, however, whereby the employee who normally works and resides in Belgium remains subject to Belgian social security while teleworking abroad. For teleworking within the EEA or Switzerland, Belgian social security continues to apply if the arrangement qualifies as a temporary posting or if – when the telework is more structural and qualifies as a simultaneous employment – Belgium is designated as the competent state (which will generally be the case where the employee resides in Belgium and works exclusively for the Belgian company). For teleworking outside the EEA or Switzerland, any applicable bilateral social security treaty must first be examined; such treaties typically cover posting and sometimes simultaneous employment. Where no treaty applies, the local legislation of both countries must be applied, which may even result in dual coverage.
In case it’s the other way around – where the employee resides outside of Belgium and (partly) teleworks from their residence state – there’s an additional dimension. Indeed, within the EEA and Switzerland, an employee for whom the work performed in their residence state accounts for at least 25% of their total working time or remuneration is in principle subject to that state's social security scheme, with direct consequences for the Belgian employer. That said, if the residence state – just like Belgium has – signed the Framework Agreement on Cross-Border Telework (currently 23 EEA countries and Switzerland signed the agreement) and both parties agree, a request may be submitted to maintain the employee under Belgian social security, provided cross-border telework in the residence state remains below 50% of total working time.
As far as formalities are concerned, if the cross-border telework takes place within the EEA and Switzerland, an A1 certificate must be obtained, certifying the applicable social security legislation. If the employee teleworks from a country with which Belgian has concluded a bilateral social security treaty, a certificate of coverage should be obtained.
Applicable labour law
Beyond the applicable social security, employers must also assess whether the teleworking abroad has an impact on the applicable labour law provisions. Although parties may generally agree on the law governing the employment agreement – an employment agreement between a Belgian employer and their employees can thus validly make a choice for Belgian labour law, also for the activities an employee performs remotely from abroad – it must always be verified if, in the country where the employee works remotely, specific mandatory labour law provisions nonetheless still apply.
Work accidents insurance
The matter of work accidents during teleworking abroad is often overlooked but requires careful attention. Indeed, if an employee remains subject to Belgian social security while teleworking abroad (see above), Belgian work accident legislation applies and the employer should check with their insurer to verify whether their policy covers work accidents outside of Belgium. In this respect, it’s also important to point out that the Belgian work accident legislation contains a rebuttable presumption that any accident occurring at the location and during the hours specified in the teleworking agreement qualifies as a work accident.
Immigration documents
Lastly, when employees wish to telework in another country, it should always be verified whether the employer and/or employee need to obtain additional permits to work in that country.
Tax consequences
For the sake of completeness and without going into detail, please note that cross-border teleworking can also have an impact on the employee’s personal income tax position, as well possibly expose the Belgian employer to a permanent establishment risk in the country where the employee works remotely. These aspects should therefore also be taken into consideration.
Key takeaways
Teleworking from anywhere requires careful mapping and alignment of multiple important aspects. For this reason, it’s good practice for organisations to not only include the teleworking arrangements in the employee’s employment agreements but to also design and implement a comprehensive global mobility policy. A well-defined policy not only provides clarity and consistency for both the company and its employees but also helps mitigate the legal risks that can arise from cross-border telework.
If your organisation is looking to streamline their processes when it comes to employees teleworking abroad, don’t hesitate to reach out; we’d love to hear from you!
