Log in

HR Impact: Digital Nomad Visa

29 Sep 2022 06:30 | Sharon Michnay (Administrator)

As Asian countries look to attract new residents, complications arise from confusion over employers' impact.

Working from home during the pandemic developed from a way to get business done when going to the office wasn't an option into a lifestyle with various interpretations. Employees took a "work from home" and turned it into "work from anywhere." Anywhere, in this case, could be a different, larger home in the same city, a different city inside the same country, or anywhere in the world. Governments had been lenient over the highly-impacted years but started pulling back permissions and stopped looking the other way as borders began opening.

This article from the ASEAN Briefing highlights several new opportunities for individuals looking to work from home in another country. Starting 1 October, Malaysia will begin offering its De Rantau Digital Nomad visa; offering stays up to 12 months. Foreign professionals who want to work from Thailand and make at least US$80,000 can receive up to a 10-year visa for themselves and family. Indonesia is also considering a five-year digital nomad visa.

The article highlights the requirements for the employee, but identifying any employer requirements is more challenging. A thorough review of Malaysia's De Rantau website is heavy on the qualifications for the digital nomad visa but light on the obligations for both the employer and employee. 

Will recipients of digital nomad visas and other like-programs establish a tax presence for themselves or their employers? What is the impact on social, health and welfare programs in the home or host location? 

From the employer's perspective, should a Singapore salary based upon a high-cost location be paid on remote work completed in a lower-cost area such as Indonesia? The situation may be more straightforward for contract workers, although other questions remain relevant, including questions regarding data security of the network in the new location

Countries' invitations to employees to participate in these cross-border working arrangements seem to come faster than other stakeholders in the situation can react. Domestically, governmental tax and social security laws must be developed or clarified in conjunction with new types of nomad visas. As a result, employers may be hesitant to knowingly engage in the program without it, putting a dent in what otherwise could be a mutually positive situation. In the interim, Human Resources and Talent Mobility teams need to investigate their company's appetite for risk vs. reward in this area. 

Recent months have been challenging enough with the present work-from-home culture. Without clear rules regarding how to be locally compliant with cross-border remote work, companies will need to implement internal policies that reflect their capabilities as employers and promote those to their employees.

Powered by Wild Apricot Membership Software