Government Extending Work From Home Norms

Government Extending Work From Home Norms

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The government of India has extended connectivity norms for work from home for IT and BPO companies till December 31. DoT has further extended the relaxations in the terms and conditions for other service providers up to 31st December 2020 to facilitate work from home in view of the ongoing concern due to COVID-19.

Currently, around 85 per cent of the IT workforce is working from home and only those performing critical functions are going to offices. In March 2020, the DoT relaxed certain norms for OSPs till April 30 to facilitate work from home (WFH) amid the coronavirus pandemic which was further extended till July 31.

Industry executives have confirmed that the government’s decision will help ensure business continuity and employee safety. The move will also help the industry increase its talent pool to tier II and III cities.

Fueling Sale of Mobiles, Tablets and Laptops

Industry experts also believe at this move is likely to further fuel the uptick of demand for smartphones, laptops and tablets from not only big cities but also small locations where a large number of people from ITES and BPO segment are working from home now.
The relaxations announced in March included exemptions in requirement of security deposit and agreement for WFH facility for OSPs (primarily IT and IT-enabled services companies).

Earlier, companies were not allowed to connect office Virtual Private Network to home infrastructure, a rule that was subsequently relaxed in view of coronavirus pandemic. Currently, over 90 per cent of the workforce of Indian IT companies continue to work from home.

Companies are gradually bringing employees back to work premises while practising social distancing norms and undertaking safety measures.

Talent management needs to be flexible amid work-from-home

With increasing work from home requirements (WFH) in the current environment, HR experts are of the opinion that talent management internally and across industries will need to be flexible to accommodate the new normal. Organisations will also have to treat their employees with greater autonomy in the increasingly disconnected work environment.

One of the top concerns has been dealing with many traditional roles like supervisors and managers becoming irrelevant due to the nature of remote work.

At the same time, the financial constraints faced by organisations as well the flexible work hours at hand has meant that organisations are increasingly considering gig workers and freelancers for non-permanent skill requirements. This is creating an ecosystem where instead of seeking extreme measures like rightsizing, employers are trying to find ways to utilise talent both internally and across industries.

In the new normal, workplaces will be where people will come back to collaborate as opposed to just working individually and we will increasingly have to accept the workforce as a combination of full timeand part-time professionals. Organisations will have to factor this evolution into their policies going forward.

Many companies are also defining work from home hours, emailing hours and calling hours so employees get mental and emotional space. This is part of a larger switch towards ensuring employee wellness taking into consideration their numerous domestic commitments as well.

NASSCOM Recommendations to enable Work from Home

About 90% of the workforce employed in IT-BPM sector continues to work from home (WFH). Given the available technologies and an impetus from the SARS-CoV-2 pandemic, IT/ITeS companies are looking at a long term blended working model with both work from office and work from home as a permanent feature.

Based on industry feedback in relation to provisions under Income Tax Act, 1961 (Act), there is uncertainty and requirement for enabling provisions in the context of WFH.
In this context, NASSCOM recently made a representation to Central Board of Direct Taxes and Ministry of Finance to examine certain recommendations which can help industry plan their operations from a long term basis. Given below is a brief summary of its recommendations on this front:

Clarification that expenses reimbursed by companies in enabling WFH for its employees will not be classified as perquisite – In order to provide a proper workspace setup to employees, many companies are opting to reimburse expenses incurred by employees (on use of personal internet dongles / home Wi-Fi broadband connections, phone bills, etc.).
In absence of explicit clarity in tax provisions, there is an apprehension that reimbursements on account of WFH related expenses could beclassified as perquisite under S.17(2) of the Act by tax departments, on which employee will be liable to pay tax. Hence, we have requested the Government to clarify upfront that the re-imbursements given to employees for expenses incurred to enable WFH will not be treated as perquisites under S. 17 of the Act.

Provision of tax deductible WFH allowance, similar to transport allowance, to cover expenditure incurred by employees on purchase of necessary infrastructure/ accessories – In addition to the above, there is also a need for WFH allowance for expenses which cannot be easily claimed as re-imbursement and shall entail avoidable burden if the reimbursement related processing and recordkeeping is required.
These measures will help industry in providing a seamless work from home experience for employees while ensuring continuous business process.

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