Post COVID-19 landscape of insurance tax: Workforce and location
August 11, 2020
Many of us no longer travel to work; the historical commute of old has been replaced with a far shorter journey to the home office, kitchen or bedroom. Overnight, COVID-19 has changed where, how and when we work, proving that working remotely at scale is both achievable and, for many employers and employees, desirable on a sustained basis. A recent PwC Survey highlighted that 84% of employees feel able to perform their role just as effectively working remotely as in the office and 42% of companies are allowing assignments to start via remote working. The ability to work remotely is increasingly a key incentive, if not condition, for individuals in the job market.
Alongside the uncertainty of the future, there is excitement amongst businesses about the disruption to the working model. Employers can now look for resources in a wider geographical area, allowing them access to a vastly increased talent pool.
That’s not to say that offices don’t still play an important role, both for businesses and the communities where they are located. But rather than being the default option, office-life can be balanced with home working. Those businesses that have never previously had flexible working policies may think again. More broadly, businesses will think about which environment suits particular activities best. For example, offices may first and foremost become a hub for collaboration and innovation.
This presents a tremendous opportunity. Insurers are no strangers to remote working, but this mindset shift means that all employees can consider remote working from a location of their choice - whether that’s across the country or even worldwide. This, in turn, will create a more engaged workforce, who feel that the business cares about them, motivating them on a daily basis.
Insurers will be able to change their real estate footprint perhaps even levelling up across the regions. This is a potential win-win, saving from the costs of expensive real estate whilst increasing the business’ geographic coverage.
Our second COVID-19 pulse survey showed that in Financial Services, 21% of companies currently have 'virtual workers' but in two years the industry expects to see an increase of 16%.
However, successfully implementing a long term virtual working environment comes with a range of challenges. Considerations need to incorporate both the employer’s and employees’ perspectives:
Employer - operating efficiently to drive progress and productivity
|Strategy and policy||
It is clear that many employers will need to embrace these changes and update their policies if they want to retain top talent across their workforce. Some are already investing in technology to support this change (e.g. our myAtlas tool, which can help understand the implications and compliance obligations associated with remote working in over 60 locations). Others are reviewing processes, procedures and sign-offs, alongside thinking more holistically as to the future of their business - all of these have tax consequences that need to be addressed.
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