With many businesses planning to reopen their offices and worksites in the near future, it’s clear that not everyone will be returning to the workplace. Many organizations plan to allow large numbers of employees to continue working remotely given remote work’s success during the pandemic. Mercer, an HR consulting firm, surveyed 800 employers and 94% stated work productivity was the same or higher since employees started working as a remote employee. Pearl Meyer, an executive compensation firm conducted a survey with similar results. In their survey of 349 companies conducted last February and March, more than 80% of participants reported their organization’s shift to remote work during the pandemic had been successful, and nearly 40% reported an increase in productivity.
What was once a perk has now become commonplace with many employees reporting they’d look for work elsewhere if their current employer required them to return to the office full- time. Once the decision has been made to allow employees to continue to be remote, companies must ensure processes and policies are in place for smooth, continued operations. In particular, employing a remote employee in a state different from the employer’s presents more administrative burdens. Here is a checklist to help ease those burdens.
Payroll
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- Require out-of-state employees to complete a state W-4 and update with the payroll provider. Note that some states, such as FL, AK, WA and TX, do not require a separate state tax form.
- Ensure the payroll provider establishes unemployment insurance and a withholding account for that state.
- Consult the corporate tax advisor to determine if a business license or sales and use tax account is needed.
Insurance
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- Add the state to the company’s workers’ compensation policy. Some states, such as OH, require a separate state workers’ compensation policy to cover remote employees in their state. Note that organizations are liable for injuries that occur in an employee’s home office if the employee is working remotely.
IT, Security and Office Equipment
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- Consult with IT staff to ensure current counter-cyberattack software is sufficient to handle adding employees in other states.
- Ensure proper secure VPN/Server/Remote access infrastructure is in place and that employees are trained on its use.
- Determine whether the company will provide or reimburse for home office equipment, high speed internet, cell phone, home office set-up, etc. Note that some states, like CA, require employers to cover a portion of communication costs for remote employees.
- Determine the need for employee monitoring software.
HR Compliance
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- Consult legal counsel to determine compliance with labor laws in states. Some states have very specific regulations concerning HR activities such as hiring and onboarding. For example, many states have ban-the-box laws restricting application questions concerning prior arrests and convictions. Others allow such inquiries at various stages of the hiring process. Conducting pre-hire drug and other background checks is an area in which states have very different regulations.
- Some states, like NY and MA, require the addition of an IVF rider in health insurance plans.
- Conduct a compensation analysis to determine necessary adjustments due to varying costs-of-living from state to state.
- Ensure compliance with state wage and hour laws including paying proper minimum wage.
- Ensure compliance with mandatory paid leave laws. Many states, such as CA, CO, DC, NY and NJ, require paid family leave that is administered through the state and financed through a state payroll tax.
- Ensure required employment law posters are provided and home occupation permits are obtained if state-mandated.
- Reassess all leave and telecommuting policies to ensure clear and non-discriminatory.
- Conduct state-mandated trainings. For example, NY, CA, DE and ME are among the states that require sexual harassment training. Others, like CT, KY, NH and OR, require COVID safety training.
- Ensure current performance appraisal processes and tools are adjusted to meet the needs of remote workers and supervisors.
Communication and Engagement
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- Ensure video conferencing applications are serving communication needs.
- Create more opportunities for connecting with remote workers and ensure they feel like part of the team. Assess whether current procedures inadvertently make remote employees feel disengaged and left out.
- Conduct more frequent check-ins with remote employees.
Smart HR Has You Covered
Smart HR works with many multi-state employers and ensures those clients are compliant with employment laws in the states in which they have remote employees. Among the many services Smart HR offers is handling all HR functions such as recruiting, hiring, onboarding, benefits administration, employee relations, compensation, performance appraisal management and training to name a few. When a client outsources its HR function to Smart HR, it can rest assured that a knowledgeable, seasoned and personable Smart HR consultant has all their HR needs covered. Call today.
