Global mobility of highly skilled workforce – how to avoid risks and succeed?

Mobility in the survey

Just how crucial global talent mobility is today is shown by the results of the EY 2023 Mobility Reimagined Survey – “How can reimagined mobility help organizations see reward and not risk?”. The survey was conducted among more than 1,000 mobility professionals, leaders and recently posted mobile workers.

Here are some interesting comments and insights from respondents:

1. Both employees and employers emphasize the high value and potential of mobility, with 88% of employees eager to take up employment abroad in the future and 78% of employers indicating a measurable return on their investment in implementing an employee mobility program.
2. 93% of employees believe that working in an international environment would have a positive impact on their lives.
3. 90% of employers believe that the mobility strategy they implement drives business growth and contributes to the increase in the company’s value.
4. With 92% of employers confirming that there are tangible benefits to digitizing the mobility function, most expect to maintain or increase their investment in technology to support mobility over the next five years (although only 35% of employers have done so to date).
5. Employees with a history of mobility experience are again declaring their desire to participate in an overseas business trip program. It is therefore estimated that global business trip spending could exceed USD 1.5 trillion by 2026.

The survey indicates that global mobility creates a life change – it is an opportunity to broaden employees' professional and personal experiences. For companies, in turn, it is an effective method to cope with talent shortages and drive business growth.

New forms

As a result of technological and organizational changes, as well as changes in attitudes toward work, new forms of global mobility are emerging that go far beyond the traditional concept of a worker physically traveling to a country for a predetermined period of time. New forms of global mobility include, for example:

• “virtual assignment” – the employee is formally on secondment from a Polish company to a foreign company, but in practice works for the foreign company mainly from Poland, and travels to the country of secondment and possibly to other countries occasionally (e.g., a few days a month);
• employment of foreign people working largely abroad under an employment contract with a Polish company (e.g., a Polish company hires a Spanish sales representative based on employment contract to sell its products in Spain);
• “digital nomads” – people who work remotely from abroad for a Polish company and often move between countries for private (non-business) reasons.

Global mobility of high-skill employees – key challenges

Companies are often unsure how to approach such new forms of employment or cooperation so as not to make a mistake or cause negative consequences for the organization and employees. Sometimes there is a perception in companies that if an individual works mainly from Poland (i.e. does not physically go on secondment to another country) or works remotely from abroad for a Polish company, such forms of employment or cooperation are not exposed to the risk of additional consequences for the company or employees.

In order to act in accordance with the law, it is necessary to check the potential effects of global mobility, among other things in terms of:

• personal income tax (PIT) regulations in force in Poland and abroad, but also relevant double taxation treaties, so one can make sure if there will be no tax liability abroad (potentially even in several countries) or double taxation;
• social security regulations - both Polish (ZUS) and international; one should look into whether there is an obligation to pay social security contributions abroad (if one works in the EU or some other countries, one could potentially apply for an A1 certificate);
• regulations governing health insurance – it is worthwhile to provide the employee with at least basic medical care abroad, e.g., by indicating that it is advisable to obtain a European Health Insurance Card (EHIC) or an S1 document;
• permanent establishment - if an employee works abroad for a Polish company, a permanent establishment (PE) of the Polish company may arise abroad within the meaning of double taxation treaties; if an individual on virtual assignment to a foreign company works in Poland, a PE of the foreign company may arise in Poland; it is worth analyzing the scope of activities performed by the employee in order to be able to assess whether such an establishment arises, and if so, the company must settle corporate income tax (CIT) in the country where its establishment arises;
• labor law – it is necessary to analyze the labor regulations in force in a given country; there are cases where one should know the labor laws of both countries and provide the employee with those regulations that are more favorable to them in a particular respect; as a result, when hiring a single employee, for example, German regulations on minimum wages and the number of vacation days may apply, even though the employment contract is concluded in accordance with Polish labor law (as German regulations are more favorable to the employee in this regard, and the employee also works in the territory of Germany, so the regulations in force there may apply as more favorable to the employee);
• immigration laws – in order to legally reside and work in certain countries, one must fulfill immigration obligations such as various registrations, obtaining work or residence permits.

Aligning employee (talent) mobility policies

If a company decides to hire mobile employees and chooses to use one of the new forms of cooperation, it should look at the extent to which legacy systems and processes correspond to the new HR policy, and especially the mobility policy. This refers, for example, to the situation where, in accordance with company-wide rules, the company grants a separation allowance or cost-of-living allowance (COLA) to expatriate employees. The mobility policy should then clarify whether such allowances are also available to employees on virtual assignment who work from home in their home country and do not experience separation from their families.

Managing a multinational team

One should not overlook the fact that overseas transfers also constitute a challenge in terms of diversity management: managing teams that are not only dispersed, but also diverse in other ways, including cultural and environmental. The soft aspects of efficient and genuine leadership are crucial to the successful implementation of global mobility programs for the most valued employees. For this reason, it is worthwhile to analyze the employment systems and processes already in place, and in doing so, review the management style of the organization and see if it supports building a mobile team of talents working for the company in different countries around the world.

Consultant’s assistance

There are new trends in the global labor market, and consequently new forms of talent hiring, aimed at engaging and motivating the best, most capable professionals and experts. Much greater access to the global talent pool than before is one of the key conditions for companies to grow their business. Therefore, it makes sense to be prepared for new forms of cooperation with a global talentpool. At the same time, one should be aware of the various factors that determine the success of the whole project of global talent mobility. Formal and legal aspects come to the forefront. Knowledge and proper application of legal regulations have a huge impact on whether a mobile and global talent engagement will actually be beneficial and safe for both the company and the specialist – expert using such a form of cooperation.

Today, in an ever-changing market situation, it is particularly important to analyze and plan the talent pool that a company has now and in the future. It is worth looking at how to successfully implement a mobility program and what are the legal requirements in the individual countries. The ongoing battle for talent means that organizations should redefine workforce mobility and treat it as a driver of growth for both the business and individual employees – talents without which real company growth is not possible.