How to manage costs for remote workers
A breakdown of the most common remote work costs and ways to effectively manage these expenses for your organization.
By Bram Harton on 25 May 2023
With remote and hybrid work on the rise, it is clear that managing costs has become somewhat of a challenge.
Over the last couple of decades, the average share of non-wage costs in the Netherlands makes up 22.9% of employees salaries. Similarly, the average share of non-wage costs in Germany makes up 22.2% of employees salaries.
Here’s a breakdown of the most common remote work costs and ways to effectively manage these expenses for your organization.
❯ Online tools and software subscriptions
1. Online tools and software subscriptions
Tools like Slack and Zoom became popular tools for teams online — along with more niche tools designed specifically for remote work. For example, KLM has partnered with GoodHabitz to improve their hybrid learning culture. GoodHabitz is used to provide online training for pilots and other flying personnel, who do not have fixed working hours or an office to come back to. GoodHabitz online training is also being used to train staff who carry out heavy work, such as those working in the baggage basement. Providing your team with the necessary online tools and subscriptions is key to managing remote teams and ensuring productivity.
One solution to this challenge is prepaid cards for employees. Prepaid credit cards and expense management systems provide solutions for:
- More secure online spending
- Facilitated subscription management
- A decrease in hassle and risk of sharing confidential information
2. Home office equipment and technology
Providing remote workers with home office equipment not only ensures remote work productivity, it’s also a legal requirement so you’ll want to make this process as easy as possible.
Legal requirements for the Netherlands
- In the Netherlands, it is important to respect the working conditions law for working from home. Equipment such as good office chairs and extra computer screens must be provided, with the possibility to reimburse and lend resources.
- Employees’ remote workplace must be ergonomically sound. You must provide your employees with objects, technical systems, and tasks that are designed specifically to improve safety. Examples of these remote work expenses include:
- Ergonomic mouses
- Proper lighting
- Appropriate keyboards
- Since January 1st 2022, you must also provide a home allowance of €2,15 per day.
Legal requirements for Germany
- Home office under German law requires mutual agreement between employee and employer. If agreed upon, the employee must provide computers, smartphones or tablets under the German data protection law. This equipment may be rented or leased and does not necessarily have to be purchased.
- For electricity and internet costs, a flat-rate usage fee can also mutually be agreed. All home office expenses may be declared within the German tax return.
- The German ministers have decided to continue and improve their current 5-euro-per-day tax rebate. Employees working remotely must be provided with a 5 euro a day allowance, which you can use to reduce your income tax burden.
There are several ways to simplify your job as a finance manager while helping keep your remote team productive. These include discovering the types of business expenses remote teams incur, setting budgets with maximum allowances, and ensuring purchasing is made easy for your employees.
- Ask employees what they need: Find out what your employees need beyond laptops, mouses, and desks. This can improve both employee morale and productivity. To ensure employees work from home like a pro consider home office equipment such as: portable storage, desk lamps, charging adapters, microphones, headphones, and even the option for daily coffee.
- Setting budgets: As a manager you can use an expense management software to assign budgets home office equipment. For example, with a prepaid business card, your employees have the freedom to make purchases without the risk of exchanging card details, saving yourself from the hassle of finding the correct equipment. All you have to do is sit back and validate or reject the expense.
- Making purchasing easy: To ease purchasing, many companies have opted for company accounts on popular marketplace platforms. For example, the bol.com business account is being used by more than 300,000 entrepreneurs within the Netherlands and Belgium, including Partou Kinderopvang and Bouwcenter. Company prepaid credit cards will allow you to track and validate a variety of remote work expenses.
Having a budget and payment solution for home office costs means:
- Clear budgeting
- Facilitated tracking of equipment expenses
- Saving finance teams time
3. Additional out-of-pocket expenses
73% of employees in the Netherlands, and 68% of employees in Germany consider flexible work as the new norm, but this doesn’t mean you need to abandon company culture.
Offering gifts or vouchers can be a great way to ensure these employees feel important and remembered. These one-off-costs are usually covered by petty cash; a disorganised solution.
Example: UberEats meal perks
For example, UberEats remote work solutions provide food delivery allowances to cover the cost of individual meals. Companies like Unilever used UberEats vouchers to reward its employees — an initiative that created genuine excitement and nothing but positive reactions. A great way to ensure all employees, including remote workers, feel a part of your company.
As a finance manager, an effective installment of a positive company culture allows you to benefit from the opportunity to boost employee productivity, promote healthy choices, and reduce turnover. If your aim is to create a productive company culture, then offering training or courses are crucial for your employees. By assigning budgets to prepaid business cards for courses, you can ensure your employees feel supported.
Example: ING offering training budgets
Another example is ING, which has assigned individual training budgets of 1,500 euros per employee as their new standard. Employees at ING are able to achieve certificates and expert knowledge, while also having the choice as to what skills they would like to improve. Whether internal or external, employees should always feel supported in their journey of professional growth.
One-off costs like these example can be covered using prepaid business cards for:
- The removal of petty cash
- Improvement of company culture
Expense management for remote workers
The benefits of remote work are clear, however we all need help when it comes to managing the challenges of remote work. An expense management system and mobile app have become vital in today’s digitized world, and it is time to take advantage of the ability to facilitate the tracking of your business expenses.
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