Digital Nomadism Has Gone Mainstream. Are Enterprises Prepared?

Today’s issue was guest-authored by Holly Kehrer , Vice President of Enterprise Solutions at MBO Partners?

In recent years, the workplace has undergone a dramatic transformation. Traditional office-bound jobs have morphed into more flexible working arrangements incorporating remote and hybrid work. In the midst of this change is the rise of digital nomads—professionals who leverage technology to work remotely while traveling the world. United by a passion to seize upon the freedoms of the new working era, digital nomads range from those who simply extend the occasional vacation for a few weeks, incorporating remote work, to individuals with no true permanent residency, flitting between cities, states, and even countries on a whim.?

Tech-savvy and In-Demand

According to our most recent Digital Nomads Report , 18.1 million Americans—more than one in 10 workers—describe themselves as digital nomads. And this isn’t slowing any time soon. Digital nomads tend to be among the most tech-savvy of workers. It is a demographic highly proficient in the use of emerging technologies and artificial intelligence solutions—proficiencies highly sought after by enterprises in today’s jobs market. These professionals choose this path because of the flexibility and satisfaction that digital nomadism offers to them. So long as enterprises need driven, skilled, and tech-savvy workers, they’ll need to contend with digital nomads.

Zero Governance

While I have seen many organizations understand this trend and make efforts to attract and retain this new breed of worker, I have yet to see organizations, en masse, take substantive measures to create and implement true digital nomad governance policies.

Though one would be hard pressed to find an organization today that doesn’t have some kind of policy regarding remote or hybrid work, it is incredibly rare for such policies to take seriously the requisite regulatory minefield.

Based on the data from our latest report, 14% of digital nomads with traditional jobs reported that their employers do not know they are nomadic, and an additional 22% say their company does not have a digital nomad policy of any kind.

In today’s world, businesses need to consider where their employees are working from so that they may identify and remediate the very real legal and tax exposure that such arrangements can create.?

Since both U.S. states and countries differ on how compensation is taxed, both professionals and enterprises, depending on the circumstances of their engagement and knowledge of relevant legislation, could unwittingly break employment laws and regulations, leading to legal and compliance risks.

I know for a fact that many organizations do not take these potential issues anywhere near as seriously as they ought to.

?While many regulators at the state, federal, and global levels have yet to take substantive action here, it is only a matter of time. Companies need to start thinking about this as early as now if they want to mitigate legal and compliance risks associated with a workforce increasingly comprised of digital nomads. If your organization wants to stay ahead of the curve when recruiting and onboarding digital nomads, feel free to connect with us and use our digital nomad policy guide .

Trending Topics

• According to the August 2024 jobs report , nonfarm payrolls expanded by 142,000, up from 89,000 in July but still below the 161,000 forecasted by Dow Jones. Meanwhile, unemployment fell to 4.2%.
• Job openings slumped to 7.67 million in July 2024 according to the Job Openings and Labor Turnover Survey of the U.S. Department of Labor.
• According to payroll processing firm ADP, companies hired just 99,000 workers in August 2024, less than the revised 111,000 in July and below the 140,000 Dow Jones consensus forecast.
• Multiple research across workplaces show that bonuses and pay incentives for employees can make people worse at their jobs, instead of making them better.
• According to a new report from Salesforce, one in five workers are hiding the fact that they use AI tools at work. Why? It boils down to unclear rules and expectations about the use of the tech and what their manager is going to think of their usage of these tools.

A National Labor Relations Board prosecutor has concluded that Amazon should be held jointly liable with a contractor for allegedly using unlawful tactics to discourage Atlanta delivery drivers from unionizing. This comes as joint employment continues to be a contentious labor issue in the U.S?

Sources

https://www.mbopartners.com/state-of-independence/digital-nomads/

https://www.mbopartners.com/state-of-independence/corporate-digital-nomad-policy/