The Hidden Challenges of Switching to Remote Work

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COVID-19 forced companies out of the office and into the brave new world of remote work – and many are likely to stay there, at least to some degree.

Telecommunications advances enable employees to do most office jobs from home without disruption. Zoom and Microsoft Teams are making meetings more efficient and collaboration seamless. Those tools, as well as Slack, Google Hangouts, and numerous others are making the transition to remote work smooth and simple.

Employees like the flexibility and their bosses like saving on rent. As long as productivity stays high, the remote work trend seems to be gaining momentum.

Even Silicon Valley - where tech giants are known for their massive campuses – may be on the cusp of a shift. Facebook announced that half the company's 48,000 employees may go remote within the next decade. Google is letting its entire workforce work remotely until 2021, at least. Twitter made the option permanent.

Remote Work Opens Opportunities

The trend toward remote work started long before the COVID-19 crisis dramatically accelerated the adoption rate of remote work. Companies such as Github and InVision adopted the distributed workforce model years earlier and proved that a dispersed team of more than a thousand employees can still function as an effective, single unit. With no central office, these companies were able to hire the top talent anywhere in the world, not just within commuting distance.

Hiring globally is one of the biggest advantages, but there are many other benefits. A remote workforce is easier to scale than one that is centrally located and allows the company to reduce labor costs. Travel expenses, high utility bills, and general office upkeep are all eliminated, Salaries differ from country to country, allowing companies to pay less while offering competitive local compensation and benefits packages.

A remote workforce is more flexible, allowing companies the agility to seize on an opportunity quickly. If the market proves untenable at some point, it's easy to pivot to another market without uprooting the entire workforce. It also lets companies serve their clients better by hiring more in regions where sales are high, to give that added local touch.

Now that many companies are taking the dive, or at least thinking about it, it's vital to consider the potential challenges as well.

Unforeseen Challenges

Many of the new companies experimenting with remote work learning as they go. The following are challenges that may take time to arrive. But they are important factors to consider in the context of a shift to remote work.

1. Staying in full compliance when hiring abroad

When a company switches to a remote model, it may want to take advantage of the global economy to hire the best workers at the lowest price. Since geography is no longer a consideration, some of those workers may come from other countries.

Finding those workers is easy. More than 40% of the global workforce already worked outside the traditional office before corona arrived. The challenge is paying them in full compliance with local labor laws and tax codes, salary expectations, and benefits benchmarks.

To get that done efficiently, it's important to know the employment options available, including opening an entity, outsourcing to an employer of record, or hiring independent contractors. An easier route is to start with companies such as Papaya Global that help build remote teams with full compliance.

Remote work offers many opportunities, but it takes planning to do it right.

2. Mixing work and personal life could accelerate burnout

For employees, working from home can be a luxury that adds hours to their day. They save commuting time, and may even sneak a few household chores in between work projects, freeing up time after the workday finishes.

But living and working in the same small space can have a downside as well. Some people may find it challenging to draw a line between their work and their lives outside of work. That's particularly true in times of quarantine, where staying at home is the rule. It could cause stress or even burnout.

According to a study, employees who struggle with work-life balance are 4.4 times more likely to show signs of burnout and decreased productivity. The study focused on the effects of the current crisis on employees, but for companies moving to remote work, that challenge to help workers find balance will continue.

A company should prepare guidelines for employees to help them keep work and life separate. Tips include creating a designated workspace, keeping regular hours, and sticking to a normal routine as if they were heading to an office.

3. Hidden costs make budget planning difficult

Moving from an office to a remote model can save costs in numerous operations, but there are always unexpected expenses.

Hiring employees in countries with lower salary expectations can lower overall workforce costs. But there may be hidden costs as well. For example, Argentina requires employers to pay the 13th month of salary as a bonus. Brazil also has a 13th month as well as a holiday bonus that amounts to the 14th month. Mandatory benefits differ from country to country, so research and planning are essential to avoid surprises.

While companies can expect to save on the price of utilities, they are likely to see spikes in spending on hardware service and upkeep. If they were able to pay a lump sum for office WIFI, that cost will increase if the company pays for each employee's internet access individually.

Time will also be allocated differently, with more demands on managers to keep a dispersed team aligned and focused on the company's top priorities. Keeping each employee feeling connected will require a deeper time investment from the HR department. Group activities such as All-hands meetings will have to be held during working hours, reducing productivity for the sake of unity.

Companies thrust into remote work are sure to discover discrepancies between their planned budgets and their actual expenses.

Disclaimer: The opinions expressed in this article are the personal opinions of the author. The facts and opinions appearing in the article do not reflect the views of IBT and IBT does not assume any responsibility or liability for the same.

This article was first published on June 20, 2020