2. Points to consider

There are significant cost, resource and risk issues involved in employing staff in a non-UK country, which need to be resolved at the planning stage. These include:

1. Tax and social security (national insurance) implications - When a member of staff is paid in the UK and is working overseas they may remain liable to pay tax and social security on their earnings within the UK, depending on their residency status. The individual's tax status is also pertinent and may influence their liability in the UK and in an overseas Country. The employee and University may also become liable for tax and social security in the country that they are working. The rules that govern tax and social security are different in each country and usually quite complex. This means that an individual could be liable to pay tax in a specific country but not the social security and vice versa. The University is responsible for ensuring that social security contributions are deducted and paid to the appropriate authorities in both countries and may also be responsible for making appropriate tax deductions.

Where a member of staff is liable for tax in both countries an agreement called a double tax treaty may be in place between the countries that allows the member of staff to pay tax in one country. These agreements are country specific; dependent on the individual's tax status therefore advice will need to be taken from an external expert in relation to specific cases.

Where a member of staff is liable to pay tax outside the UK, the University may need to procure specialist services to calculate the appropriate tax and facilitate payment of overseas taxes, a 'shadow' payroll. This is likely to result in an ongoing cost to the Department employing the individual. It may also be the case that, in some instances, the tax and social security costs in the overseas country are more favourable than the UK allowing for savings to be made.

2. Local taxes / company and accounting registration (corporation presence) - Employing staff overseas may result in the University creating a permanent establishment in another country. As a result the University could potentially be subject to local tax filings and payments, in addition to local accounting filings. For example, it may be the case that by employing a single member of staff who performs their duties for the University in another country, the University would be required to file audited annual company accounts, pay corporation taxes and social security contributions in order for the employee to legally work within the country.

Failing to do this could expose the University to the risk of prosecution and financial penalties. The administration cost of this set up and requirement to procure country specific advice will need to be taken into account when this applies. This would result in a cost to the Department employing the member of staff.

3. Work permissions / Visas - Working permissions or a Visa may be required by employees in order to work overseas. This will depend on their nationality and on the country in which they will be working from. There may also be implications on an employee's UK visa arrangements if they are subsequently working outside the UK. For example, if an employee with a Tier 2 visa spends more than 180 days outside of the UK in any 12 month period, this could impact their ability to apply for settlement in the UK.

4. Pensions - There may be implications for eligibility to join (or remain a member of) pension schemes for staff based overseas. For example, where an employee works within the EEA and this is not on a secondment basis, then they may not be eligible to be a member of USS or the University of York Pension Fund, in such instances the equivalent of the employer's contributions wil not be paid in any other form. In these circumstances, and where the University has an auto-enrolment obligation, membership of The People's Pension may be offered as an alternative. It may be possible for staff based overseas and not based in a country within the EEA to join USS or the University of York Pension Fund. In all instances, checks would need to be made by the University's Pensions Team and departments would need to meet any additional costs made in performing these checks. It should be noted that there are limits to the length of time a USS-eligible employee can be seconded for and specific criteria which have to be met. All secondments lasting longer than one year need specific approval from the USS Trustee prior to commencing.

Eligibility for membership of NHS Pensions would need to be considered in conjunction with the NHSBSA on a case by case basis.

5. Additional Allowances - In some specific circumstances it may be appropriate to provide additional allowances to staff who are sent overseas on a long term assignment. This may include return travel from and to the UK, relocation expenses and additional living expenses. Guidance should be sought from the relevant HR Adviser before any commitments are made and where necessary, covered under any research grant.

6. Employment Rights - The statutory employment rights in the UK and the host country may be different i.e. annual leave entitlement, parental leave and pay, how pay increases are awarded etc. While it is unlikely to be a significant issue for staff on University terms and conditions of employment, as an example, it should be noted that some European states offer significantly more generous maternity provisions than the current UK provisions.

7. Health and Safety - Prior to a member of staff being employed overseas, a risk assessment should be completed and approved at departmental level and should be given due consideration by colleagues from Health anmd Safety Services to ensure that any risks are identified and, where appropriate, steps are taken to mitigate these. Action will also need to be taken to ensure that the University complies with any local legislative requirements relating to Health and Safety. A more detailed risk assessment must be undertaken for assignments that will involve greater risks, including postings to destinations/areas where the Foreign and Commonwealth Office advises against travel (or 'all but essential' travel), or where the planned activities are deemed to be potentially hazardous.

Where staff are employed through a partner organisation, or seconded overseas, it is important to ensure that health and safety responsibilities are clarified. The University and partner organisation must agree who has responsibilty for the Health and Safety of the employee and compliance with local legislative requirements. These must be clarified, in an agreement, prior to staff commencing employment. It is desirable that where a partner organisation has country specific Health and Safety expertise that this should be utilised.

Where a member of staff based overseas is directly employed by the University it may be necessary to procure specialist Health and Safety advice to ensure compliance with relevant country specific requirements.

8. Insurance - Employer's liability insurance is arranged via the Health and Safety Services (HSS). The University insurance policy covers staff working within Great Britain, Northern Ireland, the Channel Islands or the Isle of Man. Cover is extended to employees working temporarily anywhere in the world, excluding offshore work unless agreed with insurers. The definition of 'temporarily' for insurance purposes includes working elsewhere in the world for up to 24 months between return visits to the United Kingdom.

If an individual's circumstances fall outside of these parameters ie they will be away for more than 24 months or are not usually based within the UK, advice must be sought by the University's Insurance team to arrange alternative cover specific to the case.

9. Day to day management - Consideration will need to be given as to how communication will take place in general but also with regards to supervision and management, for example, dealing with sickness and holding performance review meetings.

10. Data protection - If an employee's role involves processing personal data, this could give rise to data protection issues, especially if the employee will be working from a country outside of the EEA which is not subject to the General Data Protection Regulation and other EU data privacy laws. At minimum, a Data Protection Impact Assessment will be required, to assess the risks involved. Depending on the role and planned working location involved, it is possible that external specialist Data Protection advice may be required.

11. Sanctioned countries - The employment of an individual working from a sanctioned country is likely to be declined. However, due to the nature of the University's activities, requests in line with University strategy will need to be considered. Any request to commence business relationships or process payments in relation to a sanctioned country will be assessed on a case by case basis by the University Executive Board to ensure all risks are assessed and compliance issues addressed. Further information can be found on the Finance regulations and policies webpages.