Now more than ever, employees are interested in working remotely. It’s one of the first questions that we are asked by candidates when conducting recruits for our clients with hard-to-fill positions. Another scenario we come across a lot lately is when an employee moves to another state and the company offers them to work remotely. The reality is that many employees have come to enjoy telecommuting and savvy employers with tele-commuting positions are reaping the benefits in retaining and filling hard-to-fill positions. Like it or not, remote working relationships are increasing and are not going away!
The issue with hiring employees from different states is that employment laws vary by state, and, in some cases, cities and in many cases, your company now must comply with the employment laws in the areas where these employees reside.
The following are some things to keep in mind when employing staff from other states and even cities within your own state:
1. Hiring Remote Employees in a New State or City
Guess what? You will not get a letter from the government telling you that you now must comply with their laws. You need to know the legal requirements for conducting business in all cities and states where your employees reside. Employers of remote employees must always be mindful of the state and local laws where their remote employees work and/or reside and determine which employment laws apply to their remote employees.
For example, an employer in Reading, Pennsylvania recently hired a teleworker from New York. In doing so, the PA employer now has to offer NY state required disability benefits coverage and Paid Family leave to that employee even though there is no requirement to offer these benefits by the Commonwealth of Pennsylvania.
Employers need to determine which state and local employment laws may apply to their remote employees, in addition to applicable federal laws. Whether an employer is subject to a particular state or local law often depends on how many employees the employer has within that state or locality. Hot tip! Start by registering with each applicable state’s Department of Labor and become familiar with their employment requirements.
2. Paying Your Remote Workers
Each state (and some localities) have different payroll tax requirements. This means you’ll need to stay on top of applicable state and local filing deadlines, tax rates, and tax changes, in addition to federal laws. Your payroll provider should be able to guide you through these requirements.
3. Different states (and some localities) have different payroll tax requirements
In addition to the Federal Fair Labor Standards Act (FLSA), be sure to check state wage and hour laws for additional requirements, particularly around record-keeping, overtime, minimum wage, exemptions, pay frequency, and pay statements.
4. Posting Requirements for Employers
Many federal, state, and local labor laws require employers to display posters in the workplace outlining the employee’s rights. Of course, physical posters aren’t as effective for remote employees who don’t come into the workplace each day, even if labor laws require that you have them posted.
Depending on the posting requirement, it may be appropriate to provide postings electronically or to mail them hard copies that they can post at their remote worksite. Again, it is important to check all applicable laws to ensure compliance with posting requirements.
5. Workers’ Compensation for Remote Employees
You need a workers’ comp policy that covers remote workers. Just because they’re not working in the office itself doesn’t necessarily mean they don’t need to be factored into the workers’ comp policy. They may be eligible to receive workers’ comp benefits for injuries or occupational illnesses that occur at home in the event that the injury or illness arises out of and in the course of employment. Check to be sure that your workers’ compensation policy covers telecommuting and your carrier is licensed to offer coverage to employees in the states where you have employees.
6. Don’t Forget About Local Employment Laws
In some areas, the local employment laws, often larger cities, are more generous to employees than the State. For example, in Philadelphia, employees are entitled to mandatory paid sick leave for full time employees , domestic workers can bank sick time between employers and are guaranteed rest breaks. None of these benefits are required by Federal and Pennsylvania State employment laws.
Maintaining good standing in other states or cities requires constant attention, especially when you do business in multiple states/cities. If you want to learn more about how to maintain your good standing, contact Hubric Resources at (610) 670-7878.
Also, if you need assistance in developing policies and procedures for telecommuters, help with hiring for hard-to-fill positions or anything HR, we are here to help!
