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Visa-wise, they are probably just committing fraud by staying on a tourist visa.

At least Europeans won't send them to labor camps in El Salvador.

edit: burn karma burn

French immigration is currently allowing remote workers on the one year visitor visa, so long as your company doesn't have a presence in France. Basically, as long as you are not doing business in France or taking a job from a local they are fine with it.

However, it's difficult to proceed to a residency permit in this situation, and you can't join the national healthcare system.

VPN. Simple as that. Most companies aren't bothering to check anyway, most that do aren't detecting VPNs, and for the few that do that, there are ways to circumvent detection if you are really determined.

Wouldn't they figure out you've installed a VPN on their machine?

Not if you set the VPN up on your router. You can also buy small portable routers designed specifically to sit between your machine and your wifi / ethernet.