It’s Time Your Company Had a Digital Nomad Policy — 7 Steps to Creating One

Prior to pandemic times, the term “digital nomad” conjured up images of mostly young creative types working out of hostels and from trains while traversing time zones. And yet today, with only 23% of workers back in offices in former business hubs like Manhattan, our understanding of digital nomadism has become “more expansive,” according to Naomi Stone, a Development Manager at Room Service 360.

What was once billed a fringe lifestyle has become, at least for a subset of workers, the norm. 

“There’s a new, updated and modified digital nomad,” Stone said. “Many ‘traditional’ workers have already started to migrate to digitally nomadic setups as the pandemic progresses. Workers have flocked to WiFi-equipped cottages and cabins for lockdown-friendly, manager-approved staycations. ‘Quarantine apartments’ and ‘social-distance retreats’ have enticed remote employees seeking more space for a few weeks — or months.”

As we move into a future that’s still steeped in uncertainty, the popularity of digital nomadism — whether employee-elected or the result of further lockdowns — isn’t likely to wane. Hybrid workforces are on the rise, and that’s to many workers’ benefit. According to research published in the Harvard Business Review, digital nomads report higher job happiness (90%) and income satisfaction (76%) than other workers. And yet, despite the growing number of these workers, “few companies have official policies and programs in place to support them,” said Rameez Usmani, Tech and Security Expert at Code Signing Store.

“Digital nomads are in some ways off the grid both literally and metaphorically,” Usmani said. “Most of the time they make arrangements with their immediate superiors, go nomadic under informal ‘don’t ask, don’t tell’ agreements, or go without the knowledge of their employer.”

To stay current, it’s crucial that companies start incorporating digital nomadism into their official policies, to the benefit of both themselves and their workers. Below, experts shared with us the seven qualities of a truly effective digital nomad policy.

1. Take a stance on timezones. 

For many, this will simply be a process of formalizing unofficial pandemic-era policies, when workers first set up camp across the country. For others, these policies have long been in place. Sebastian Schaeffer, CTO of dofollow.io, says his company has been “entirely remote for years” and that asking key employees to stick to certain time zones has helped.

“You want team leaders to be reachable during normal business hours so that there are no communication lags,” Schaeffer said. “These are delicate conversations, and it is worthwhile to consider beforehand whether you are willing to offer team leaders and key employees additional compensation for agreeing to remain in a particular area when their colleagues may be free to move around much more.”

Other companies have designed their policies to where any employee can work from any location — so long as they agree to be online for the same handful of hours. That’s the case at Test Prep Insight, where Janelle Owens is HR Director. After employees moved to Ireland, New Zealand, Aruba and Mexico during the pandemic, communication bottlenecks were “killing productivity metrics,” Owens said.

“For the sake of maintaining your productivity and open team communication, you need to set clear guidelines about availability,” she added. “For us, this means that overseas employees have to be logged on for at least four hours of every workday that overlaps with our team on the U.S. West Coast. It does put a damper on the digital nomad lifestyle of some of our overseas employees because they now need to log on at 8 p.m. or 4 a.m., but it comes with the territory.”

2. Make sure you have the right network infrastructure in place.

For Benjamin Stenson, CEO of The Norsemen, a 50% remote company, this was an early area of focus. 

“One factor to consider is the ability of your company’s network infrastructure to cope with remote workers accessing systems and files,” he advised. “It’s important that all employees, regardless of whether they work in the office or remotely, are able to access systems and files quickly and easily.”

Beyond access, data security should also be considered, John Li, CTO of Fig Loans, added.

“Businesses need to place strict limitations on the hardware and software used to access their databases or supply employees with tools that meet their cybersecurity requirements,” Li said. “Employees may be prohibited from operating on public Wi-Fi networks or may use a VPN to mask their devices. Zero-trust security measures and multi-factor authentication should be a must for all remote employees.”

3. Enable asynchronous communication.

Digital nomad policies are, in theory, a harbinger of modern, innovative companies, yet many “still stick to a largely 9-to-5 structure out of familiarity and ease,” Michael Steele, CEO of Flywheel Digital, said.

“To walk the talk, companies need to invest in cloud-based collaboration and project management tools so team members always know what is expected of them and can share thoughts and contributions outside of meetings, emails and synchronous conversations during business hours,” Steele said.

4. Provide relevant benefits. 

Budget and resources that previously went entirely to in-office staff in the form of onsite perks should be redistributed to include remote workers, Ewelina Melon, Head of People at Tidio, said.

“The pandemic has changed the general view of work benefits,” Melon said. “Gym memberships became irrelevant with closed facilities, and medical insurance companies saw a big boom of interest. To encourage employees to work remotely and possibly travel as nomads, companies can think of offering something like coworking memberships valid in multiple locations, online shopping vouchers, insurances that work abroad, and so on.”

5. Understand your compliance costs.

Digital nomad employees can leave companies open to certain regulatory and legal risks, Brad Touesnar, CEO of SpinupWP, said.

“The laws and regulations that apply to a person’s work tend to be based on the jurisdiction where the work is done, not the jurisdiction of the employer,” he said.

Because of that, companies should determine whether any particular countries or locations will create undue compliance costs, then instruct digital nomads not to work there. 

“There are state and national regulations, and even international regulations, that will be limiting,” Chris Dyer, a remote work expert and culture consultant, said. “Companies may be able to navigate these regulations to move forward with work-from-anywhere, but compliance costs can be exorbitant. We need governmental bodies to work out with private industry how we are going to address these changing dynamics in our workforce. Employees need to understand, too, that employers are not always able to offer a completely ‘work-from-anywhere’ policy, not because they don’t want to, but because they are not legally allowed to.”

6. Have digital nomads sign contracts specifying they’re telecommuters.

Speaking of compliance costs, taxation laws can create pretty sizable headaches for companies that employ digital nomads. Protect yourself by clearly documenting traveling workers as telecommuters, advised Ben Wallington, CEO of Designerwear. 

“You have to consider that taxation laws will generally change if your employees are not located in the same place as your workplace,” Wallington said. “Two ways to take care of this and enable your employees to keep travelling at the same time would be to draw up a contract outlining the situation carefully and to advise your employees to not stay in the same place for too long.”

Bunkering down in the same location for too long can make workers liable to pay taxes, and not preparing for that puts both employees and employers “in a bit of a spot,” he added.

“Emphasize the importance of changing places and looking at local laws, and most importantly, draw up a contract stating clearly that your employee is a telecommuter,” he said. “So, if your employee wants to live in India for a while but retain his job in the U.S., he can as long as he doesn’t stay longer for 183 days and you have an explicit agreement.”

7. Consider how you’ll include digital nomads in your company’s culture.

Though some may be working from afar, find ways to foster connection between on- and off-site team members, Steele said.

“Virtual social events should be scheduled at a time when it’s convenient for as many employees as possible, and if your company does have a physical space, effort should be made to balance virtual and physical opportunities to connect and socialize,” he said. “Connection also doesn’t have to take place synchronously — a ‘water cooler’ or other non-work-related Slack channel can be a great way to spark conversation and connection without needing to be online at the same time.”

Ultimately, it’s best to focus on the opportunities that come with employing digital nomads — and not just the challenges.

“I highly recommend employers who can have digital nomad policies do have them, and I recommend they create them with a focus on the possibilities more than the restraints,” Nance Schick, a New York City-based employment attorney and “part-time digital nomad before it was cool”, said. “Yes, there are concerns, such as confidentiality, cybersecurity and safety, that need to be addressed with the employers’ legal counsel. But this is a tremendous opportunity to review what is truly necessary to get required work done. It’s a chance to streamline, update and release.”

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