Guidance for managers on employing staff based overseas
- Options for employing staff overseas
- Posting UK Staff overseas
- Tax and Social Security (National Insurance) Implications
- Local Taxes/Company and accounting registration
- Additional allowances
- Health and Safety
- Working Permissions/Visa
- Data Protection
- Useful Contacts
- Travelling overseas on University business
- Overseas worker tax assessment – Basic facts template
- Health and Safety - Travel Safety and Overseas Work
- Travel Insurance
This guidance provides an overview of the main areas that should be considered when contemplating employing staff based overseas or posting existing members of staff on an overseas assignment and outlines the process that should be followed.
This guidance does not cover short term travel overseas. Guidance for staff travelling overseas on University Business can be found at:
There are a number of areas that may require consideration prior to employing staff based overseas including employment contracts, health and safety, insurance and tax. General guidance relating to these areas is outlined below though the requirements tend to be country specific. There are also a number ways that staff can be employed. Due to the complexity of employing staff overseas it is important that advice is sought as early as possible to ensure that country specific considerations can be identified and any additional costs related to these can be highlighted.
If you are considering employing staff based overseas, or posting an existing member of staff on an oversees assignment, you should contact your Head of College / University Services HR Manager as soon as possible. They will liaise with other specialists as required to ensure that you are provided with the appropriate advice and guidance. It is important that advice is sought before any commitment is given to employing staff overseas.
If planning to employ staff overseas as part of a grant proposal and you wish to employ them through a partner organisation or other third party this may need to be identified within the grant application.
Options for employing staff overseas
There a number of options for employing staff overseas.
1) University employees assigned or seconded overseas
This guidance predominately deals with the implications of basing members of staff who have been employed by the University in the UK to another country. This could either be directly by the University or through a secondment to a partner organisation. Normally these staff are paid through the UK payroll.
2) Employees on local terms and conditions
Another option is to employ individuals on local overseas terms and conditions and pay them in local currency. This could be undertaken directly by the University or through a partner organisation. Where an employee is directly employed by the University and paid in an overseas currency, the services of a payroll bureau or partner organisation would normally be utilised to facilitate the appropriate payment of the member of staff in overseas currency. The use of a bureau service will incur additional costs. The University would also seek specialist legal advice to ensure that the contracts of employment meet the requirements of the country.
3) Consultancy / Self employed contractors
A final option where a service is being provided is to enter into a contract for services with a self employed contractor or through a consultancy agreement. In this instance the individuals concerned would not be employees of the University. This would require a specific contract for services to be drawn up.
Posting UK staff overseas
Where a member of staff employed on UK terms and conditions is posted overseas they do not automatically lose their UK employment rights. In addition they may gain additional employment rights based on the legislation of the country they are posted to. For example, within Europe the Posted Workers Directive (1996) provides protection to workers being sent on assignments to other European Union member states for up to a year to ensure that the terms and conditions of work meet the legal minimum of the country to which they are posted. This includes hours of work, minimum pay and health and safety. This means that employees could potentially be entitled to enhanced terms and conditions of employment while on assignment to another EU state. While it is unlikely to be a significant issue for staff on University terms and conditions of employment it should be noted that some European states offer significantly more generous maternity provisions than the current UK provisions.
The Equality Act 2010, the main UK discrimination legislation, is not explicit about its territorial scope. This means that dependant on the specific circumstances this legislation may apply to staff based overseas. The Universities Equality Statement outlines a commitment by the University to promote equality in all its activities and aims to provide a work, learning, research and teaching environment free from discrimination and unfair treatment. These principles should apply regardless of geographical location.
Managers are reminded that laws and customs concerning equality and diversity issues may differ greatly in other countries, and should encourage staff to thoroughly research their destination country in advance, for example using the FCO Travel and Living Abroad guidance and other useful links available at: www.gla.ac.uk/services/humanresources/internationalisation/overseas/. Where potential problems or risks are identified, further guidance can be sought from local Human Resources teams.
When a member of staff is required to work outside the United Kingdom for more than one month the University has a statutory requirement to provide them with details of their rights during the period of overseas employment including the currency they will be paid in, the period they will be based overseas, additional allowances and arrangements for return.
Where a member of staff is seconded by the University from the UK to a partner organisation overseas or a partner organisation employs staff locally overseas and seconds them to the University, secondment agreements will need to put in place with both the individual concerned and the partner organisation to clarify responsibilities of the University and the partner organisation. This is to ensure that areas such as intellectual property rights and responsibility for health and safety are clarified before the onset of the arrangement. It should be noted that the law of some countries does not allow secondment of overseas staff into the country and staff must be employed by the local organisation.
When staff are assigned overseas there may be tax and social security implications even if they continue to be paid through the University payroll in the UK. The area around tax liability and social security is complex and country specific so specialist advice will need to be taken. The template at appendix 1 contains the information required for an assessment to be undertaken. This should be completed by the recruiting / line manager at the earliest opportunity and forwarded to the relevant Head of College / University Services HR who will consult with the University’s Payroll and Tax experts.
There are some general areas for consideration
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 paid within the UK. This will depend on their residency status. 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. 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 appropriate tax and social security contributions are deducted and paid to the appropriate authorities in both countries.
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 and advice will need to be taken from the University’s tax advisor in relation to specific cases.
Where a member of staff is liable to pay tax outwith the UK the University may need to procure specialist services to calculate the appropriate tax and facilitate payment of overseas taxes. This is likely to result in a cost to the College / University Service 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.
Local Taxes/ Company and accounting registration
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 College employing the member of staff.
There may be implications for eligibility to join pension schemes for staff based overseas. If members of staff are permanently based in Europe out with the UK they are not eligible to be members of the existing University pension schemes.
Universities Superannuation Scheme
Those who are posted on a temporary assignment can continue to be a member of USS for up to 5 years. Exceptionally, this may be for longer so long as USS are informed and approve the absence in advance of the individual leaving the UK.
University of Glasgow Pension Scheme, NHS Pension Scheme, NEST, Medical Research Council Pension Scheme, Local Government Pension Scheme, Scottish Teachers Superannuation Scheme
For those who are members of one of the schemes above please contact Pay & Pensions for scheme specific advice.
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. Any additional allowances should be discussed with the relevant College / University Services HR Manager before any commitment is made to a member of staff.
Health and Safety
Prior to a member of staff being employed overseas a risk assessment should be carried out by the recruiting manager 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 & 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 the responsibilities of both the University and partner organisation for the Health and Safety of the employee and compliance with local legislative requirements are 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.
Further advice and guidance on Health and Safety considerations and undertaking risk assessments can be viewed at the Health, Safety and Wellbeing website.
Insurance requirements for staff based overseas will be affected by the period of time that they are based overseas and the country within which they are based. It is essential that appropriate insurance is arranged through the Insurance and Risk Section of the Finance Department and that this is in place prior to the employee commencing work overseas.
Where a member of staff’s normal base is the UK and they are sent on assignment overseas for less than twelve months cover will normally be provided through University Travel Insurance policy. While this provides emergency medical cover it will not cover routine medical costs and the employee may wish to take out additional health insurance in this respect. If an employee is required to travel from their overseas base to a country outwith the UK this may not be covered by the University Travel policy and advice should be sought from the Insurance and Risk Section prior to travel.
An additional premium is charged by the University Insurers where a member of staff is planning to be overseas for more than twelve months, or if they are likely to be participating in any hazardous activity. This cost needs to be met by the School, Research Institute or University Service. Failure to advise the Insurance and Risk Section of extended stays or hazardous activities may result in the cover being deemed invalid by the Insurers. It should be noted that this may also apply to travel to areas that the Foreign Office is advising against visiting for "all but essential travel".
There may be requirements within specific countries for the University to have additional insurance. E.g. in the United States the University would require to hold workers compensation cover. This will be assessed on a case by case basis by the Insurance and Risk Section. As a result, if you will be working overseas, you must notify the insurance team in advance so that we can ensure the University is meeting the requirements and there is adequate insurance in place to protect you. Please complete Appendix 1 and send to firstname.lastname@example.org.
Further information regarding the University’s insurance policies and cover can be found on the Finance: Insurance and Risk webpages.
Working Permissions / Visa
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 are based. Advice can be provided by your College / University Services HR Manager regarding this.
It should be noted that under the Data Protection Act where personal data is transferred out of the European Economic Area (EEA) the University must ensure that the recipient country provide adequate level of protection for the data and that the data subject is aware that their personal information will be sent outside the EEA.
Further guidance on data protection can be provided by the data protection and freedom of information office at www.gla.ac.uk/services/dpfoioffice/.
Human Resources – College / University Services HR contacts are detailed at: www.gla.ac.uk/services/humanresources/contact/colleges/
Insurance and Risk Section – Finance Department, www.gla.ac.uk/services/finance/staffsections/insuranceandrisk/
Ian Thomson, Insurance and Risk Manager, Ian.Thomson@glasgow.ac.uk
Finance Office Tax – Carolyn Timar, Financial Accountant, 3934, Carolyn.email@example.com
Pay and Pensions - www.gla.ac.uk/services/finance/payandpensions/
Health Safety and Wellbeing - www.gla.ac.uk/seps/
Internationalisation - www.gla.ac.uk/about/internationalisation/