Since the COVID-19 pandemic, the way we work has undergone a dramatic transformation. Millions of workers who once sat in cubicles or crowded into coworking spaces now describe themselves as digital nomads—remote workers who combine working remotely and traveling across borders. This digital nomad lifestyle allows people to work from anywhere, whether it’s a beachside café in Portugal or a mountain lodge in Colombia.
As exciting as this sounds, it also presents real challenges for employers. That’s where a digital nomad policy comes in.
What Is a Digital Nomad?
A digital nomad is someone who works remotely while traveling, often across different countries. Unlike vacationers or expatriates, digital nomads blend professional work with a location-independent lifestyle. Many are freelancers, but a growing number are full-time employees who’ve convinced their employers to let them work remotely from another country.
According to MBO Partners, the number of American workers who consider themselves digital nomads increased significantly between 2022 and 2024. This shift has pushed companies to rethink their approach to remote work and global talent.
Why You Need a Digital Nomad Policy
With more employees looking to live and work abroad, a digital nomad policy isn’t just a nice-to-have—it’s essential. This policy acts as a guide for both employers and employees, ensuring everyone understands what’s allowed, what’s not, and how to remain compliant with local laws.
Without a clear policy, employers face risks like:
- Violating employment law in another country
- Accidentally establishing a permanent establishment
- Failing to withhold or pay income taxes correctly
- Breaching visa or immigration laws
Companies that embrace remote flexibility without structure could end up in legal hot water. A digital nomad policy protects both sides.
What Should a Digital Nomad Policy Include?
Creating a solid digital nomad policy involves more than telling people they can “work from anywhere.” Here are best practices for building a strong framework:
1. Eligibility and Duration
Not every role is suited for the digital nomad lifestyle. Outline which positions qualify, and how long employees can work abroad—especially in countries with limits on tourist visas.
2. Location Restrictions
3. Compliance and Legal Considerations
Make sure your policy covers:
- Tax obligations
- Payroll procedures
- Employment law in the host country
- Visas and permits required for work
4. IT and Security Protocols
Employees working across borders must follow strict data protection rules, especially when dealing with client or company data across jurisdictions.
5. Communication and Time Zones
Working across different time zones can impact productivity and team cohesion. Establish core working hours and expectations for availability.
6. Benefits and Insurance
Ensure that your remote employees remain covered by health insurance and understand their benefits abroad.
The Rise of Digital Nomad Visas
To attract remote workers, many countries now offer digital nomad visas. Unlike a tourist visa, these permits allow digital nomads to live and work in a foreign country legally for an extended period—often 6 to 12 months or more.
Countries like Portugal, Estonia, Barbados, and Costa Rica have embraced this trend, offering digital nomad visas that simplify the legal requirements for remote workers. However, each visa may come with specific criteria, such as:
- Proof of employment
- Minimum income thresholds
- Health insurance coverage
- Restrictions on providing services to local clients
Employers should work with global mobility experts to understand which visas are available and how to support their employees through the process.
The Role of Employer of Record (EOR) in Global Mobility
Want to support global mobility without setting up an entity in every country your employees visit? A smart move is partnering with an Employer of Record (like Empleyo).
An EOR helps you:
- Hire and manage remote workers in other countries
- Navigate local labor laws and tax regulations
- Handle payroll, benefits, and compliance
- Provide a legal buffer for your expanding global workforce
Whether you’re exploring corporate digital nomad programs or simply supporting one employee’s overseas adventure, an EOR ensures you’re compliant every step of the way.
Best Practices for Managing Digital Nomads
Here are a few final tips for success:
- Start small with a pilot program
- Use technology to track location and documentation
- Communicate frequently and clearly
- Revisit your digital nomad policy regularly
- Partner with an EOR to avoid legal surprises
Final Thoughts
The digital nomad trend isn’t going away. In fact, as flexible work arrangements become the norm, US employers that embrace this shift will be better positioned to tap into a wider talent pool, retain top employees, and stay competitive.
But it all starts with the right foundation. A solid digital nomad policy paired with global HR support from Empleyo can help you unlock the full potential of a mobile, agile workforce.
Ready to support your remote employees no matter where they roam?
Contact Empleyo today to build a policy that works globally and keeps you compliant.
