The Covid-19 pandemic touched every corner of the globe, forcing countrywide lockdowns, disrupting business and driving HR departments around the world to make radical changes in how we operate.

As we emerge on the other side, it is clear we will never fully return to how things were once done. There are new HR trends taking shape that, with careful planning and forethought from business leaders, could have a positive impact on their strategy and operations, and ultimately their bottom line.

Trend 1: Hybrid Work

Many employees relocated when workforces switched to remote work, leaving teams scattered and no longer dependent on one geographical location. While some companies are requiring employees to return to the office, other employers are offering their teams a hybrid solution. Which route your company takes could mean the difference between keeping or losing staff — nearly 40% of workers said they’d consider quitting if forced to return to the office full time.

In order to successfully implement a hybrid work model, HR leaders must communicate the answers to all employee questions, including: What is the timeline for a return to the office? What in-office safeguards will be in place for those returning and what precautions are expected of them? Will HR policies be updated regarding sick leave and paid time off? Many states have different HR laws that will dictate the answers to these questions, but they could also restrict your communication with employees surrounding healthcare and vaccinations.

Trend 2: Global Expansion Is Gaining Popularity

Remote working environments can be the natural first step to moving a business into global markets, offering new opportunities for growth and earnings. Over the past few decades, global expansion has become easier and more affordable. Further, due to the pandemic, governments around the world have loosened strict regulations around how companies can set up business in their country.

Many countries are allowing businesses to hire skilled labor through a professional employer organization (PEO)/employer of record (EOR) like our company, which can provide legally compliant employment contracts, employee benefits, payroll and HR expertise without the need to establish a legal entity or subsidiary in that country. This not only allows countries to maintain foreign business development, but also enables employers to acquire the international top talent they seek.

In turn, location is becoming less important in hiring. For employees, this offers a newfound freedom to live farther from business hubs, be closer to ailing parents or explore other countries. For employers, the ability to hire outside of their geographic boundaries has made it easier to leverage skills and talent from around the globe.

Trend 3: Tax, Payroll And HR Administration Are Getting More Complicated

Tax compliance risks have increased with remote work. A 2021 survey reported that 28% of employees worked outside their state or country of residence, but only one-third provided a complete accounting of their location to their HR departments.

Employers are required to withhold state taxes where employee work occurred, therefore companies run the risk of tax penalties for failing to correctly withhold payroll tax for employees who have not reported an address change to HR.

We saw a mass exodus of employees from Silicon Valley to other states courting them with promises of a low cost of living. And employers are finding this shift can be to their benefit, by adjusting salaries to match state wages. However, this ultimately depends on the company’s long-term designs on nurturing remote work. It may be within the company’s best interest to maintain a highly skilled worker’s salary even if they relocate to keep from losing them.

These are just some examples of how the new work environment will complicate traditional tax and payroll processes. HR teams need to be prepared with the knowledge needed to make these decisions.

Trend 4: Increased Data Collection

Just as businesses need to be aware of the collection and safety of customer data, they should take the same protection and care with their employee data. This is even more critical if using a third-party vendor to collect, store or analyze employee data.

Already, businesses are reporting an increase in the amount of passive data collected from employees, including tracking an employee’s location, virtual logging in, email monitoring and company computer and phone use. Expect to see this practice expand as the number of remote workers increases and companies collect health and safety data.

It is important to follow best practices to maintain state compliance and check your state privacy laws. Massachusetts and California have their own set of laws in place to protect their residents, so check with every state in which your employees reside.

Finally, by keeping employees informed of what data you are collecting and why, you can build trust through transparency. Offer them the opportunity to update their personal information through HR software with the ability to input, access and update their data. These systems increase data accuracy and save the HR team valuable time.

Remote work and global expansion bring countless opportunities to employers, yet the increase in data collection and regulation surrounding tax, payroll and HR have made it more critical than ever to be prepared.

These HR trends will continue to play a pivotal role in the strategies of companies worldwide. Identifying the right growth partnerships can determine your success in this new future of work.