Home Is (Wherever) the Heart Is
While Many Canadians Considered Working From Other Provinces or Countries During the Pandemic, a New Survey from the National Payroll Institute Reveals that Few Flew the Coop
TORONTO, April 12, 2022 /CNW/ - Scrolling through Instagram, Facebook or Tik Tok the past two years, it would have been easy to assume that scores of Canadians had thrown off their flannel pyjamas in favour of beachwear. Having taken advantage of working remotely, they chose to work from anywhere. It turns out that looks can be deceiving, and assumptions are often wrong.
According to a new survey from the National Payroll Institute, the impression that, as the pandemic dragged on, more and more Canadians were working from a beach in Antigua or a Parisian Café was simply false. The truth is that most Canadians (90%) continued to work from their home province throughout the pandemic. The survey also indicated that those who relocated tended not to stray too far from home, with three quarters (73%) remaining in Canada and one quarter (26%) in the United States.
"Although working from anywhere isn't prevalent yet, Canadian employers would be wise to get ahead of the curve by preparing policies and processes to offer the increasing flexibility that workers are seeking out," says Peter Tzanetakis, President, National Payroll Institute. "In February 2020, working from home and hybrid models were not top of mind. Today, flexibility is an expectation and key differentiator for businesses competing for talent in a limited pool. It's not a huge leap to think that the ability to work not just from home but from anywhere will be next – but doing so comes with significant payroll complications for both employers and employees."
The survey results lend credence to this prediction. Despite the relatively low prevalence of Canadians actually working from other provinces or countries, doing so was an idea that sparked the imagination of many more. Nearly one out of four replied that they considered working from abroad while keeping the same job, and 39 per cent said that they would keep their current job but live in another province or country if their employer permitted it.
When it comes to relocating to another jurisdiction (province or country), the opportunity to experience another part of the country or world (46%) was the most common reason for doing so. Other reasons included: saving money (38%), improved work-life balance (29%), investing in property in a different market (22%), and living closer to family and friends (21%).
Presently, with offices reopening after two long years, the factor trumping any of the above reasons that draw workers to lands far and wide is their pay. Seventy-seven per cent of respondents indicated that they would not accept any pay decrease as a trade-off for geographical freedom. And those few who are willing to sacrifice some salary say that they are not willing to sacrifice much. Only four per cent would accept a decrease of 20 per cent or more.
Workers may not have factored in the different costs of living in other parts of Canada and beyond. Housing costs in Toronto or Vancouver, as opposed to St John's, are typically much higher. Similarly, moving to Portugal, Costa Rica, Spain, many Caribbean countries, or Mexico – all identified as destinations of choice by survey respondents – is likely to be less expensive when compared to living in a major Canadian city.
Although attending a virtual meeting while lounging in a beach cabana is appealing, what it takes to make cross-border work a reality remains a mystery to many working Canadians.
"Moving abroad while continuing to work for one's current employer is not a simple proposition," explains Tzanetakis. "Workers cannot simply pick up and move without working with their employer and their payroll team. Doing so can have serious consequences for individuals and can result in non-compliance with legislation, and fines, for businesses."
In addition to determining the tax implications of cross-border work, the employment standards and workers' compensation are also other pieces of the puzzle that need to be addressed. The rights and benefits that employees benefit from will differ from province to province or country to country, as will the related remittance and reporting requirements for employers.
Moving outside of Canada is even more complicated, due in part to the different requirements within each and every country. For instance, if an employer is unaware that an employee is in another country, they are likely to continue remitting income tax to the Canada Revenue Agency or Revenu Québec based on where they believe the employee is located. Meanwhile, the employee may be required by the country they are actually in to pay local income tax there as well, which can significantly reduce how much money they have left to live on.
These are only a few examples that underscore the complexities of working from anywhere that nearly half (48%) of respondents admitted to being completely unaware of. An additional 34 per cent indicated they were only "generally aware" of the implications and would need more information from their employer.
"If working from anywhere is the next step, it is vital for businesses to tap into the expertise of their payroll professionals to help them and their employees safely navigate these complex challenges," adds Tzanetakis. "In a recent research report from PwC Canada, entitled Remote and cross-border employment trends – is Canada ready?, it was found that payroll requirements associated with remote work are more complex in Canada, when compared to other jurisdictions."
The National Payroll Institute champions payroll in Canada as being vital to the health of businesses across Canada by setting THE professional standard of excellence and sharing critical expertise. We provide the knowledge and resources that more than 40,000 payroll professionals need to realize their potential, 1.5 million employers depend on for the annual payment of $1.06 trillion in wages and taxable benefits, and that governments rely on to receive $364 billion in statutory remittances to fund critical programs each year. The Institute's designations are recognized as the gold standard for expertise and professionalism, and the only such designations for payroll in Canada.
SOURCE National Payroll Institute
Keera Hart, Kaiser & Partners, [email protected], 905-580-1257
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