Live in Israel, work abroad

The economic crisis of 2009 has led to more Israelis working overseas Monday to Friday. The pay may be good, but it’s not for everyone.

By ANAT COHEN
311_airplane (photo credit: Ariel Jerozolimski)
311_airplane
(photo credit: Ariel Jerozolimski)
The shock waves of the economic crisis in 2009 led to a new phenomenon in the employment sky: Israelis traveling overseas, mostly to European countries, to work abroad between Monday and Friday and return on the weekends to their families in Israel.
If you talk with employees who have chosen this work format, they don’t complain; for them, the new routine is to travel to work for five hours, including the trip to the airport and the flight. An exhausting schedule, yes, but also rewarding.
How is life on the air routes? Whom does this work style suit? What do the placement companies that specialize in short-term relocation say about it? And what legal and tax pitfalls await the hero of the airways? Israelis who work this way, placement companies, and legal and taxation experts describe what it’s like: The workers Omer, a 42-year-old Israeli, married with two children, boards the plane to Germany every Monday morning, to work as director of business development at a German hi-tech company, and returns to Israel each Thursday night.
“I’m not the only Israeli to have chosen short-term relocation, and my sense is that this trend is intensifying.
On the plane, I meet the same Israeli faces on the outbound and return flights, each one employed somewhere else in Germany between Monday and Friday. And since we fly out and return on the same flights, a bond has grown between us.
“At least in my case, this work format is a form of escapism: you enjoy the privilege of escaping from a hot, sweaty and nervous place like Israel, to a relaxed, polite working environment, with a more appreciative corporate culture than in Israel. The pay is better too, about 50 percent higher compared with the alternative I could find in a similar job locally. But for me, the enormous advantage lies mainly in the promotion horizon.
The prospects of advancement in a big corporation abroad are much better than in the small local pond.”
Why not go for an extended period, like two years, and take the whole family with you? “Israel is our home. It’s the anchor.
I like the atmosphere of the weekend with friends and family, and I don’t want to cut myself off, or cut my children off, from here. In fact, this way I get the best of both worlds. Although there’s a price as far as the family is concerned, because we miss one another, there’s also an advantage: This lifestyle prevents a marriage from stagnating.
“This growing format of short-term relocation is also more worthwhile for my German employer: I can testify about myself that, as an Israeli who is there for four to five days during the week, my work output is 10 days’ worth. When the family isn’t around, you find yourself working from morning to night, without counting the hours.”
What should an Israeli who is considering this lifestyle of work abroad highlight in a job interview? “The most important tip is to highlight his or her added value in marketing, sales and initiative. In addition, a very worthwhile message to get across to the interviewer is that here is a person who knows how to conduct himself independently, and that you have the ability to direct yourself. These are the two key values that employers there seek in employees on short-term relocation.”
‘It’s tiring, but the opportunities there are a lot more interesting’ A.C., 31, a bachelor and an alternative- energy engineer who recently worked as an engineer in Romania, also sings the praises of working Monday to Friday abroad.
“The opportunities there are a great deal bigger and more interesting. The markets are new, and you are offered much better promotion prospects than in Israel. Although it’s tiring to fly for three hours each way every week and to turn up two hours beforehand at the airports, at some point you slot into a kind of routine and into a way of thinking that you’re going to travel five hours to work each way every week. You get used to it, and what’s more, this alternative has proved to be a solution to the employment problem for talented Israelis who could not find jobs in Israel for silly technical reasons.”
What do you mean? “From my conversations with the Israelis who fly with me regularly every week to work in Romania, I discovered that a lot of 40-plus people are taking this option now, because in Israel they come up against the age barrier. For them, this work arrangement is a great way to change career and find a job, because in Europe they actually like gray hair. Experience is perceived as an advantage there, whereas here, people over the age of 40-45 are ruled out automatically, especially in hi-tech.”
What would you say to Israeli candidates who want to find jobs like that? “An Israeli who wants to work abroad from Monday to Friday must come to the overseas employer with a background in marketing or management, or with proven experience in sales. Anyone who knows how to sell is worth a lot of money to the overseas company. Although very shortterm relocation is highly favored these days by employers abroad, they still have housing and upkeep costs and the costs of the weekly flights.
“As a candidate, you have to justify these costs, and you should come to the interview with this in mind. If, for example, you offer services not directly and immediately connected to the bottom line [a junior programmer, for example], you really have no advantage over a local worker.”
The placement agencies Orit Ziv, CEO of Duet-HR Company Professional Head Hunter & HR Consultant, started a short-term relocation operation for Israelis last year.
“Every manager will say that, despite the euphoric talk here and there about growth, the economic crisis of 2009 is not really behind us.
Furthermore, they’ll say the big bust is still ahead. I feel this in the field: When frustrated employees or job seekers come to me, they complain that Israel’s labor market is not providing them with ‘meat.’ “At the same time, I get a lot of calls these days from global firms looking for good Israeli workers for a variety of positions in management, business development, finance, hotel management and Internet jobs, such as in SEO or gaming. Crossing these two phenomena led to a new fashion for job seekers in the country: to shift abroad from Monday to Friday, without their spouses and children.
“Following this new fashion, I switched this agency’s direction toward ‘weekly relocation’; we call it ‘temporary displacement.’ With this new activity, I, too, find myself flying to Europe almost every week, and on the plane on Thursday I meet the Israelis who boarded with me on Monday morning. So I realized that this is an employment trend that is gaining momentum: Since the beginning of 2010, I have seen a 50% rise in the preparedness of Israeli candidates to work under this arrangement.”
What is the profile of these workers? In which countries is this kind of arrangement common? “Israelis who choose five-day-aweek relocation work mostly in Germany, Belgium, Switzerland, the UK, Estonia, Romania and Bulgaria. Even in Hong Kong and Singapore there is a demand for Israelis, but there relocation is two to three weeks, because of the distance.
“As for the profile of the employees, they are mostly men between the ages of 40 and 50, people who have managerial or technical experience at a high level and candidates who are over-qualified. You must understand that in Europe, not only are employers more open on the issue of age, but for older workers who have crossed the 40 threshold there is even a kind of bias in their favor. Any talented Israeli rejected outright here because of his age has a chance of finding high-level, remunerative and enjoyable work.
“The threshold conditions for obtaining a job abroad are much lower than in Israel. For example, there is less emphasis on university education requirements. I also discovered that over there, the employer looks seriously at relevant professional experience and background, without examination institutes, screening tests, group dynamics exercises and all that nonsense.
In general, employers in Europe give the candidate credit for what he brings with him, mainly to experience.
“As far as the family aspect is concerned, it’s true that most of the Israelis are single, divorced, widowed or separated. But there are also young people in their 30s, married with young children, who have discovered the benefits of Monday-to-Friday relocation and are prepared to go for it.”
What do they tell you about the price of being cut off from the family? “They say that in Israel they work from morning until night anyway and don’t see the family. They also say that when they worked in Israel for global companies they in any case lived on planes, traveling abroad frequently.
But with this arrangement they benefit from remunerative work, with a salary at least 50% higher than for a similar role in Israel, and the firm looks after accommodation [an apartment or a hotel], upkeep and flights.
“Many Israelis who talk to me about it explain that the ill wind blew them some good: Last year’s economic crisis forced them to seek creative solutions to finding a job. In this arrangement, a worker is not disconnected from his family, and he benefits from breathing room overseas. The price is on two levels: It’s very tiring to fly back and forth every week, and they also work a lot harder around the clock. It’s fantastic for the employer: The employee is always available to him, because the work becomes his entire world during those days.”
Against: ‘From my knowledge of these nomads, they don’t last more than a year’ Eynat Guez, CEO of placement firm Relocation Jobs, thinks short-term mobility does not necessarily pay off.
“I find more disadvantages than advantages in the relocation-withoutrelocation arrangement, both for the employee and for the employer. From the employee’s point of view, life on the airways is very wearing. And I can tell you from my knowledge of these frequent flyers that they do not last more than a year. The impact on their quality of life is substantial, plus I’m not convinced that the financial benefit is worth the effort.
“Employees forget to take into account that in this format they do not enjoy the tax benefits of working abroad. Overall, the tax ceiling in Europe stands at 27%-35%. In Israel it’s 48%. But a work arrangement like this does not enter into the category of nonresidence, because as far as the Israeli tax authorities are concerned, the center of the worker’s life is still in Israel. If he works in countries that have no tax treaty with Israel, the employee may pay tax twice.”
Is it worthwhile for the employer? “From the point of view of the firm, too, a format of Monday through Friday abroad is not necessarily as profitable in the long term as they tend to think. Although this alternative is cheaper than the alternative of moving the employee with all his family for long periods, with such a work arrangement there is a very high turnover because of burnout and fatigue. In addition, there are firms that prefer to relocate workers for short periods [Monday to Friday] to save the cost of work permits. But when a company employs someone for short periods without the right permits, it exposes itself to being sued by him. It can also be caused damage in the host country.”
The legal minefield Lawyer Amit Acco, of the firm Kan- Tor & Acco, is an expert on work permits and relocation. He warns against pitfalls that await workers who relocate for short periods.
“In my experience, many Israeli employers are acting on the basis of ‘nothing ventured, nothing gained,’ to save costs of work permits abroad. I also know the leading companies that deliberately send employees to work abroad on their behalf for a few days and coach him in how to talk to border- control officials to avoid paying for a work visa. For example, if the worker is traveling overseas for satellite-equipment installation, they will instruct him to tell immigration officials that he has come for a business meeting.”
Companies will take a risk like that? “From the company’s point of view, it is trying to save a relatively expensive, complicated process of obtaining a working visa. The fee can range from $1,700 to $3,000 [depending on period of employment and type of visa], plus lawyers’ fees of $2,500-$3,000. In addition, it takes two to three weeks to sort out this process in Britain, and five months in Spain and Italy.
Employers want to avoid this cumbersome process and take a calculated risk. So they take upon themselves authority they do not have and send the employee overseas without arranging a visa as the law requires.
“Eventually, the employee may find himself with a stamp on his passport that will make it difficult for him to go back to that country and to other countries, because today there are agreements between European countries and the United States to prevent the entry of workers with Denied Entry. The risk is particularly high in short-term relocation jobs, for the frequent journeys are liable to arouse suspicions at border control.”
What does it mean for employees? “I tell them: ‘Pay attention; if the employer sends you for a few days to work overseas, demand to know whether the nature of the visit is in accordance with your visa. In other words, make sure you are not sent on a tourist visa when in reality you are working, even if it a matter of a few days.”
Taxation Lawyer and CPA Rami Arie is not sure that working overseas regularly from Monday to Friday is worthwhile from the point of view of taxation.
“Israeli workers who choose such a work format may find themselves with a tax problem pertaining to the question of their center of life. They have a permanent apartment overseas and stay there five days a week for work, but they are still residents of Israel. If they are employed in a country that has no tax treaty with Israel, they may fall into the problem of double taxation. If there is a tax treaty in the country in which they work, it will regulate the distribution of tax between the two countries: The employee will pay tax to the country where the work is done [this is the first to deduct tax] and will be required to file returns with the Israeli tax authorities every six months to obtain credit for the tax paid abroad. So this process makes life complicated for the employee, compared with the alternative of full relocation, which avoids taxation in Israel.
“Another land mine is when an Israeli worker is employed in offshoring companies; for example, by a company in Gibraltar or Cyprus that employs him in Romania. In this case, the Israeli employee is not subject to taxation laws in Romania and receives the gross salary as the net salary. When he arrives in Israel, he believes in good faith that he has no obligation to report to the Israeli tax authorities, since he worked for an off-shoring company. This is an error.
In time the Money Laundering Authority could catch up with him, and even if he acted in good faith, he has still committed a criminal offense.”
Lawyer Arye Leybowich, an expert in international tax who advises Israeli companies on relocation issues, thinks short-term relocation is worthwhile because of a large tax benefit.
“The main benefit for a worker of this kind lies in the subsistence allowance. Without having to present proof to document his expenses abroad, he automatically gets a $90 credit per day. This is despite the fact that the employer pays in full for his housing, subsistence and flights. On a monthly calculation, this is approximately a $1,800 tax credit, a very substantial amount, which he can obtain when he files his annual tax return.”
Whom doesn’t five-day a week relocation suit? According to Einat Guez, the answer is: • The pampered.
“When a candidate asks questions in an interview like, ‘Is there a golf course/tennis court/pool near the apartment you are arranging for me?,’ ‘Is there a natural-products store nearby?’ and so on, that should be a warning sign for the employer.
People looking for jobs like these need to be adaptable: people whose attitude is ‘The world is my home’ and who can live on what they bring in a suitcase. We look for people who are easily mobile, who quickly adapt to any environment, not pampered types.”
• The petty-minded “Candidates who will ask in an interview, ‘If the flight is delayed three hours, will you pay me overtime?’ are not suitable. Work between Monday and Friday overseas tends to be around the clock. This is pressured work, requiring a willingness to work hard without feeling hard done by.
Situations in which the flight is delayed not just three hours but an entire day are par for the course. An employer does not want someone who can’t cope with foul-ups.”
• Hitchhikers.
“These are the candidates who will ask in an interview: ‘In another six months, will I be able to work from Israel? Or fly less often?’ Such people are looking for shortcuts before they even start. They don’t understand that an essential part of this work arrangement is their presence on the spot.”