Sicily tries an old solution to fight old work problems
COVID19 may have made work smarter, but it is surely making taxes harder.
That is the theme of a recent article about how Digital nomads and trans-border smart working have put Europe in crisis.
European companies that are reorganizing to let their employees work remotely, even across borders have a common problem: can actual employees of a company legally work in Italy, for example, if that company’s headquarters are located in another European or non-European country?
In cases like that, where should a worker pay her taxes, or social security contributions? What about contracts, benefits, vacation days… should they be those standard in Italy, or in the company’s country? What about safety procedures and equipment should be used, and who should pay for them? If a worker is laid off, or there is a dispute with her employer, which court should judge it?
Similar or bigger problems arise when one starts looking in the opposite direction: if most of the employees of a company are in a different country, to which and how many governments should that company pay VAT and other taxes? According to which algorithms and rules?
The answers to questions like this are scattered over huge legal, fiscal and pension-related minefields, due to laws never written to cover such cases, and consequently no precedents to follow when (not if) someone will sue someone else, or their government.
The issue becomes even more interesting when one looks at the long term questions it creates. It is obvious that the solutions to all the problems above require, as that article says, “organic regulation, with a common basis AT LEAST at European level”. In other words, transnational “smart working” touches many of the bare nerves of the EU community vision: taxation, workers rights, welfare and pension systems…
Meanwhile, in Sicily …
The same article describes how a sicilian company is trying to turn all those open issues into an opportunity for people who want to live in Sicily, but above all return to live there.
On March 12th, 2020, that is the same day when I published Coronavirus in Italy, more lockdown, two sicilian entrepreneurs created a technological hub called Edgemony that, among other things aims to connect remote workers in Sicily with Italian and foreign companies.
On one hand, what Edgemony aims to do seems nothing new:
“We are entrusted with software development projects with the technical coordination that remains with the parent company, and the people found by us or that we ourselves train are allocated to the projects “.
At the same time, Edgemony also does the oldest thing, that is hiring IT developers and engineers on its own, who then work as consultants for companies outside Sicily. To find and grow talents, Edgemony “accelerates the growth of professionals, students and local companies with Masters and Digital Programs, whose teachers come from companies such as Google and Amazon”
Thanks to all these strategies, in July 2020, Edgemony had already closed deals with “a company in San Francisco, and were in contact with a Swiss company, one based in Berlin and six other Italian companies scattered between Rome and Northern Italy.”
Hopefully, these cooperations may also convince some of those companies to open a branch on the island: “We help national and international companies to create their own Tech Team in Palermo, including the guys we bring back from “outside” and the Sicilian talents we train thanks to our Intensive Bootcamps”.
So what is new in Edgemony?
Apparently, nothing, except the “ambitious idea” to train and “rent” highly skilled people… in Sicily, or returning there just thanks to Edgemony, rather than in Milan, the Bay Area or Bangalore:
“Some “brain on the run” are already returning from Milan or abroad to join the Edgemony team. We return to live in the South, without giving up the job opportunities offered by big Milanese, American or German companies.”