We think it’s fair to say that the market at the moment is incredibly challenging around talent acquisition. Finding the right person for the job was tough even before Covid and Brexit, and now it’s even harder. There are a number of roles where scale ups are feeling it the most. This includes; Technical roles including IT consultants, UX and UI developers and more recently performance marketing and insights roles.
The discussions we’ve been having with our clients are around how to be creative and think ‘outside the box’ in ways they didn’t need to consider previously in order to grow their business. Adding to the pressure is the the dreaded ‘great resignation’, as people who held off moving during 2020 and 2021 lock-downs now consider new roles, meaning that back- filling vacancies adds to the challenge.
So what does thinking outside the box look like?
One of the topics that we have been talking to our clients about is recruiting internationally. Either recruiting individuals to reside outside the UK (completely remote workers) or recruiting internationally and bringing individuals into the UK. Either way, looking for fresh talent overseas is a great way to bolster your workforce’s skillset, and really accelerate your business’ growth.
However, as you’ll well be aware, looking internationally for talent suddenly changed post-Brexit. Lots of questions are now up in the air about what’s possible and what’s not. So, we collected a number of frequently asked questions on this topic, and asked an expert. We interviewed Catherine Daw who is a partner and head of employment and the HR consultancy team at Brachers LLP. Below you’ll find details of our discussion which will provide you with a clearer understanding of the do’s and don’ts of looking outside the UK for your next hire.
Do UK employment laws apply to individuals working overseas? And secondly, what about policy policies and procedures?
The answer to that is ‘it depends’. As a rule of thumb, where there is a sufficient connection to the UK, then UK employment laws will probably apply. That’s not always the case, but ‘probably’ is a safe bet. Contracts are very important when we’re considering issues like this, as the contract will dictate what rules to work with. If it specifies that the contract is covered by the laws of England and Wales, for example, that will give us a good steer that those will be the enforced employment laws.
It’s really important then, for employers to be clear about the jurisdiction that covers their contractual arrangements, because that sets the groundwork for that employment contract. However, you must have clear policies and procedures in place. Policies and procedures (along with the contract) are your bedrock of your employment relationship. Both need to be really clear about how the contract will work, the laws that govern it and the circumstances in which changes can be made to that contract.
What contractual arrangements do you need to put in place for someone being employed outside the UK?
Quite often for our clients, when they’re looking to employ someone outside the UK, it will be the first time that they’ve tried this type of arrangement. They want to retain the ability to control where somebody lives and operates from, or where they work. In this case, a mobility clause and location of work clause will be especially important. It’s your measure on the extent to which an employer can say, “This is not working, and I need you to move to X or Y.”
If an employer wants a quite strong discretion to be able to dictate where somebody works, then they need to be very clear about that in the contract. Location change can be a life changing decision and the employee need to be able to accept that they can accommodate that amount of change. Communication, in writing, is key here.
What happens if an employee wants to move to a third country? Let’s say you have supported an employee to move from the UK to another country and they then decide that they want to move again, also outside the UK.
This one is really tricky issue, and one that I think was probably brought to light by the pandemic.
When everybody was working remotely, a number of our clients were able to agree overseas working arrangements with their current staff or new staff. A number of them had a sudden surprise when somebody said, “Oh, did I not say? I’m not working in France anymore; I’ve moved to South Africa.”
Now, obviously, if a contract is governed by the law in England and Wales, this can have big implications. There can be tax implications (taxed in their local country, as well as potentially in the UK), registration issues, or even pension issues. If employers don’t know where somebody is located, they could fall foul of all these regulatory requirements.
It comes back to contracts, as that’s probably something an employer would also want to include to make sure the mess we’ve mentioned doesn’t happen. Specifying things like where they’d need to be based, but also that an employee must give reasonable notice if they want to make a request to move locations, to make it really clear that they need to have permission to move locations and they’ve got to allow an employer enough time to check it out and see whether they’re prepared to agree to that.
Are there any data protection requirements where information might be being sent to an individual working overseas?
Again, it depends on location. There are some jurisdictions that have very similar data protection regimes to the UK. The EU, for example, has very similar arrangements and it’s much easier to transfer data across a border in those countries. However, countries further afield will not have comparable regimes, which makes it far more difficult. Combine that with the fact the UK isn’t big on sharing personal data, and that can be employee data about their contact details, their family circumstances, next of kin details, and you’ve got a big issue on your hands.
The UK isn’t keen on that type of information going into jurisdictions where there isn’t the same level of protection that we have in the UK. Our level of protection is really very high, so it’s generally not possible to transfer data to other locations. So, what’s the work around for this?
Hosting arrangements are a practical way in which you can manage this, using an employee portal that individuals log onto where all the data is held in the UK. This also helps if you have sensitive customer details, as you can make sure they’re contained and only accessed via portals or via internal intranets.
What are the new points-based immigration requirements for overseas workers?
Connected with Brexit, the laws changed last year around immigration for individuals who aren’t covered by the EU settled and pre-settled process. We should note, individuals who were already here or individuals who have applied before 2021 remain under the old arrangements. However, if we’re looking at individuals coming post Brexit break date in 2021, even if they’re from the EU, they are covered by the new points-based system.
This new system takes into account all sorts of things; things like language skills, qualification requirements, and shortages of occupations all get assigned value through points. Individuals need to hit a total points amount in order to potentially be allowed into the UK and to have the right to work. It’s quite a different arrangement from before and takes a lot of influence from the Australian points-based system. If you’re looking to bring people in now, they’re probably going to be covered by those new arrangements.
What is the impact if you don’t follow the rules?
It’s quite severe! There can be criminal sanctions applied, up to five years, and unlimited fine if you employ somebody that you know doesn’t have the right to work in the UK (Or where you ought reasonably to have known). So as an employer, you NEED to check right to work in the UK.
What discrimination laws should I be concerned about when recruiting individuals from outside the UK?
I think people are rightly very concerned about not falling foul of our discrimination laws, but there’s no reason to be afraid of them. Consistency of practice is primarily important essentially. When you are asking for right to work documentation, you should be asking for that documentation from everybody, things like that.
Providing you do that, and you comply with the normal equality provisions, employers will be all good. Most good employers now will have great equality policy and procedure and a nice equality, diversity, and inclusion statement. Those sorts of things are really important in setting the right tone and making sure that people are taking the right factors into account.
Having the right checks and balances focused on diversity, equality and inclusion is a key part of the talent acquisition process. Both in terms of information gathering, being pro-active and ensuring a positive candidate/employee experience.
Thank you to Catherine Daw of Brachers LLP (Partner | employment) for taking part in our interview series.