Katy Langlais
Manager | CRHA, MBA | Human resources consulting

The pandemic has forced organizations to look at their everyday operations from a new angle. But despite the difficulties, the crisis also presents some opportunities for the future.

We’ve all had to adapt to the new reality. Business have had no choice but to review their work methods and their range of products and services. Organizations have been forced to modify their activities, sometimes radically, operate within strict health rules or adopt new technologies.

Of course, the environment remains challenging for everyone. We encourage you to be attentive to this crucial issue for organizations: don’t neglect your own health or the health of your employees.

However, there’s another side to the coin. A major disruption like the current pandemic can give entrepreneurs the creativity boost they need to face the major obstacles in their way. As they adapt, businesses introduce innovative solutions, some of which just might be the answer to emerging market trends.

Sometimes, innovation can be hindered by the inability to turn a creative idea into a brand, a service or a product. The pandemic presents an opportunity to break through this hurdle and increase innovative capacity.

Can uncertainty be an accelerator of change and a source of innovation?

Historically, many iconic companies were created during periods of crisis. For example, Disney, CNN, Burger King, FedEx, General Electric, Microsoft, Apple, Gillette, 20th Century Fox, IBM, Hershey’s and Adobe were all founded during a recession. These success stories lead us to ask an important question: how can organizations benefit in such stormy situations?

The pressure that organizations face during a crisis leads to a sense of urgency that spurs senior management into action, whether it’s to grow the business or simply stay afloat. The need for change becomes obvious and the motivation to make change happen rises spontaneously. To keep the business going, innovation becomes a must.

What are the benefits of a corporate culture focused on innovation?

Businesses have a lot to gain from developing a culture of innovation, especially in the post-COVID era.

The first advantage is a better mobilized workforce. Layoffs, cuts to work hours and remote work have all taken a toll on employees. Involving the workforce in the company’s innovation approach sends out a clear message: employees are an integral part of the organization’s development initiatives. It also promotes social connectedness in the workforce and empowers employees to act confidently and independently. All these factors positively influence sense of belonging, motivation and performance at work.

The second advantage of developing a culture of innovation is the ability to meet the needs of the post-crisis era. Businesses that foster a culture of innovation tend to be more agile and therefore better able to deal with unexpected situations. No one can predict what the exact consequences of the crisis will be on society and individuals. However, it’s safe to assume that people’s needs and behaviours will change. Therefore, organizations need creative minds that will be able to rise up to the new challenges and adapt to new changes.

How to foster pro-innovation practices and a culture of innovation?

Stimulate innovation

For businesses that have always relied exclusively on continuous improvement practices, stimulating innovation on a daily basis begins with changing the organizational culture. This shift does not happen overnight. It’s a long-term process guided by the organization’s core values and culture. Leaders play a key role in introducing and developing a culture of innovation at their organization.

Make innovation part of the message

The statements and decisions made by senior management should embody the values of teamwork and openness. Besides the role of management, successfully fostering a culture of innovation involves two other key actions:

  1. Involve employees
    Innovation requires the involvement of all the individuals involved in the daily running of the organization. Although rarely used to their full potential, employees are undoubtedly an organization’s greatest asset in terms of ideas and innovation. While employees will need some time to adapt to the new approach, and indirect costs are involved, it should be seen as an investment. Possible ways to involve employees in innovation initiatives include:

    • Brainstorming sessions;
    • Project committees (permanent or ad-hoc) with a specific objective;
    • Knowledge sharing sessions among employees, etc.
  2. Welcome failure as a step toward success
    As human beings, we’re instinctively driven to glorify success and condemn failure. However, failure is often what leads us to eventually achieve success. With that insight, all individuals working at the organization must learn to welcome failure as an opportunity to improve, and it’s important for them to know that their managers support them using this approach. It can be very useful to give employees training on the processes and mindset of a culture of innovation. While it’s often easier to picture the final outcome, paying more attention to the process involved in getting there will facilitate the transition.

Adopt a culture of innovation across all policies and processes

You can’t promote innovation if you don’t adapt your organizational practices accordingly. In other words, in order to see results, staff management policies on pay, performance reviews, recognition, training, talent management and succession planning must all be aligned with the culture of innovation.

Strategic planning (the business model) and operational and administrative procedures also need to be adapted to reflect this cultural shift. In particular, integrating new technology can be an effective way to create innovation while improving organizational efficiency.

Propel your business forward with technology

Many innovations, especially those related to operational and administrative procedures, involve the development or integration of new technologies. Therefore, organizations should view innovation from an “Industry 4.0” angle as a means to improve the value proposition of their business model and boost their organizational efficiency.

Some technologies that facilitate communication between people can also indirectly spur innovation. For example, applications for collaborating and sharing ideas are now easily accessible on smartphones and tablets. That means people no longer need to physically be in the same room as their co-workers to participate in brainstorming sessions. The crisis can also become a source of creativity for employees, who are able to let their ideas flow and come up with new concepts for products and services. Remote communication tools can help harness this knowledge.

Now that you have some tips on how to start thinking of new ways to protect the continuity of your operations, take a step back and look at your business as a whole. What is your current business model? What skills do your current employees bring to the organization? And what might tomorrow look like if you let your creativity flow and rebuilt your business model today?

This article was written in collaboration with Éloïse Labrecque, a management advisor with Raymond Chabot Grant Thornton.

17 Feb 2021  |  Written by :

Katy Langlais is a recruiting and human resources consulting at Raymond Chabot Grant Thornton.

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In Quebec, culture, leisure and entertainment are the sectors most affected by the pandemic. The repercussions of the crisis are not only economic: they will challenge the very future of artists.

As part of a one-on-one meeting, Emilio B. Imbriglio, the President and CEO of Raymond Chabot Grant Thornton, sat down for an interview with actress and President of the Union des artistes (UDA), Sophie Prégent, to discuss the upheavals affecting the Quebec cultural sector since the beginning of the pandemic. It is clear that the cultural sector will never be what it was before and that much thought about the future of the arts in Quebec will be needed. This conference discusses how the arts community has adapted to the new reality and how it envisions the future of the cultural milieu.

A sector hit hard by the pandemic

Confinement and curfew have interrupted many cultural and recreational activities. Despite the importance of this sector and the fact that these productions are highly sought after, thousands of artists have had to give up their work. The closure of cinemas and theaters, the interruption of concerts and filming in March forced thousands of people to stop working, leading many artists to lose their bearings and even reconsider their career choices.

“It’s not normal for performers to be unable to express themselves before an audience,” said Prégent, President of the Union des artistes.

With no way to earn a living, both experienced artists and newcomers to the profession have questioned themselves in the face of the uncertain future of their careers. As President of the UDA, Prégent has made several representations to governments to raise awareness of artists’ situations, find creative solutions and participate in the development of new ways of working in the context of the pandemic.

The UDA has 13,000 artists and brings together performers from the audiovisual world (film, television, advertising, dubbing), and the performing arts (song, lyric, comedy, circus, theater, dance). In addition to supporting its members, the UDA quickly forged strategic alliances with other organizations working in the cultural milieu in order to become stronger together to overcome the challenges of the pandemic.

The artistic milieu: A reflection of society

Artists play a societal role in our community, as they are often spokespersons for social injustices and precursors of major social movements. They are influential and true vectors of social change.

One of Prégent’s main concerns since she became President of the UDA is diversity and inclusion. At the UDA, the Mosaïque committee was created to raise issues about diversity.

As Prégent explains: “There are all kinds of diversity: there’s visible diversity on the screen, there’s also audible diversity, such as people who speak French with an accent. They’re not very present on television, we don’t see or hear them. That said, there is much more diversity on the screen these days.”

“The growing role of digital technology in the way we consume music, television and film is a danger to the francophone culture. Because the music, TV and movies that we create reflect who we are, like a mirror, they bring us together, convey our values, and help us evolve as a society. With digital technology, this mirror is getting smaller and may be reduced to such a point that it will be difficult for us to recognize ourselves in it.”

Watch this interview with Ms. Prégent.

To support our artists, don’t hesitate to make a donation to the Artists’ Foundation.

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Annie Poitras
Lead Senior Manager | CPA, CA, M. Fisc. | Tax

Updated on July 16, 2021

Working remotely has become the norm for many organizations. Several employees would like to take this opportunity to work from abroad.

The COVID-19 crisis has forced companies to reinvent themselves, both organizationally and in terms of employee engagement. An increasing number of companies are planning a return to part-time office work or even full-time telework, so employers need to be flexible and open to change.

What about employees who are considering this opportunity to work remotely from another country? How can this affect your organization?

Some of your employees may think that teleworking from abroad, while keeping the same job in Canada, will not affect you as an employer, but they are wrong. Such a decision by one of your employees could result in legal, social security and tax obligations for the organization.

Steps and tax obligations

First, it is important to communicate with your employees and let them know you need to be notified if they are planning to work from another country. You can take proactive steps and issue internal guidelines for your teleworking employees and include measures for those who wish to relocate abroad.

Then, you need to validate what these impacts will be on your entity and what steps you will need to take with the employee and, possibly, with the other country. Depending on the type of work and the relevant tax treaty, the employee newly set up to telework could create a permanent establishment and, thus, a taxable presence for the company in the country where the employee is working from.

If you give one of your employees the option to work remotely outside Canada, either temporarily or permanently, you need to understand that there may be tax implications for the company.

Here are a few questions you need to answer.

Will my organization have tax obligations?

  • Does my employee’s home office become a branch in the foreign country?
  • Is there an applicable tax treaty?
  • Will my organization have new tax obligations in the foreign country?
  • What types of taxes are there in the other country: Sales taxes? Business tax? Will my employee’s presence trigger an application of these taxes?
  • Will my business have new source deduction obligations (taxes, benefits) in the other country?
  • Is there a social security agreement between Canada and the other country?

What are my year-end filing obligations?

  • What are the organization’s compliance obligations?
  • Since my employee is abroad, do I have tax obligations in Canada as well?

Other regulations to consider:

  • What labour laws govern the employer-employee relationship?
  • Will disability, injury and medical insurance coverage apply outside Canada?

As new teleworking policies come into effect and acceptance of telework from abroad changes, you need to integrate tax planning into your policy development to ensure that more flexible work arrangements do not create tax complications and risks. There are risks for both the employee and the employer in allowing an employee to telework from abroad.

As an employer, you need to think about these issues and manage the tax and legal implications for an employee teleworking from abroad. Tax planning will help avoid unpleasant surprises and even create opportunities for both the employee and the employer.

09 Feb 2021  |  Written by :

Annie Poitras is a tax expert at Raymond Chabot Grant Thornton. Contact her today!

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Mylène Tétreault
Partner | M. Fisc., B.B.A. Fin. | Tax

Updated on July 16, 2021

Given the increasing telework options, it may be tempting to work abroad while continuing Canadian activities. What are the tax implications?

From one day to the next, millions of workers around the world found themselves converting a corner of their home into a workspace. It can be expected that this new way of working will continue after the pandemic.

Some people see the resulting flexibility as a future opportunity to “follow the sun”, pack up their computer and phone and work in a foreign country when it becomes possible. Are you aware of the tax implications for such a change?

Be aware of the tax impact

It is critical to understand the tax implications of working remotely when considering working from another country, whether permanently or temporarily. Do you need to pay taxes in the other country? What about your employer, how will they be impacted by your decision to work from abroad?

There may be numerous personal tax and compliance obligations from teleworking abroad, both in the country of residence and the foreign country. You need to ask several questions before deciding to work from abroad.

Additionally, it’s important to let your employer know that you are planning to work from another country, as they will also have tax obligations and the resulting legal implications to consider.

What do you need to consider before working from abroad?

In addition to the tax considerations, the application of immigration and labour legislation in the foreign country must be taken into account before starting to work abroad.

What about your tax residence?

  • Will you be retaining your tax residence in Canada?
  • Could you possibly be considered a tax resident of the other country under its tax legislation?
  • Is there a tax treaty between Canada and the other country (even if you’re only planning to stay a few months)?

What about your employer?

  • Does your employer have any objections to your working from abroad?
  • How will your employer decide to manage the risks?
  • Will your employer’s tax obligations change?
  • Will your employer need to apply for an exemption in the other country to avoid the tax implications?

What are your tax obligations?

  • How long can you be away before your departure affects your tax filing in Canada and the other country?
  • In which country do you have to file a tax return?
  • Where do you pay taxes and source deductions?
  • Will there be double taxation?
  • If you decide to extend your stay abroad, will that change the tax obligations and planning you had already considered?

The answers to these questions could impact the decision, for both you and your employer. It’s important to get the answers to avoid unpleasant surprises.

It’s likely that the tax implications will not prevent you from going abroad to work for a while. Nevertheless, being prepared by talking to your employer and consulting an international tax specialist will help you better enjoy your adventure, since you’ll know the consequences, wherever you go.

09 Feb 2021  |  Written by :

Mylène Tétreault is your expert in taxation for the Québec office. Contact her today!

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