An Employment Attorney’s Guide to What Your Company Needs Before it Goes Remote

Before your company fully embraces remote work, you need the right people, technology, information, and policies. Here are a few practical things you should consider.

The Right People

In most situations, you need three people before your company goes remote. The first is your head of human resources. Your head of human resources will make sure that your company recruits, manages, retains, and terminates employees in compliance with the law. This is a difficult job because of the many different compliance requirements imposed by various states and localities. 

Working with counsel, your head of human resources must ensure your company provides the appropriate paperwork, training, and legal protections based on the state where your employee lives. 

The second person your company needs is a payroll specialist. Your payroll specialist ensures your company properly pays employees. But payroll specialists do far more than just process payroll. They ensure your company reimburses employees for expenses and appropriately deducts taxes and garnishments. They calculate commissions and monitor for questionable business practices. They must become experts on differences in state laws on pay, expense reimbursement, garnishment, and overtime. 

Generally, your payroll specialist should never be the person you put in charge of human resources because of potential conflicts of interest. If you cannot find the right person to lead your payroll practices, consider outsourcing this difficult job and offloading some payroll liabilities. You should also regularly engage an outside company to audit your finances, including payroll practices.

The third person you need is arguably the most important for your business’s functionality in a remote environment: your head of technology. Your head of technology makes sure your remote company remains operable, secure, and compliant. It is a challenging and high-pressure job because of the security risks and the importance of technology in a remote work environment. In a company that relies on remote employees, if the technology fails, so does the company. Your head of technology is critical to your company’s success. 

The Right Technology

Your company needs the right hardware and software for your remote employees to thrive without compromising your cybersecurity. When your company embraces remote work, this is not a time to cut corners. While your head of technology will likely lead the conversation, you must make technology decisions with input from the company’s business and human resources team. 

Technology is not just about your employees being able to do the job securely; it is about deeply connecting with the company, customers, and colleagues. The right technology ensures your remote employees can do their job as efficiently, securely, and authentically as possible. 

The Right Information

Do you know where your employees are located? I know that you think you know the answer. But you might not. If there’s even a chance you don’t, stop reading this blog right now. It’s time to double-check. This is one of the most critical pieces of information. 

Not knowing where your employees live and work, or assuming they are still living where they were at the time of hire, can create serious legal issues and risks. For example, you must ensure your company complies with state-specific workers’ compensation, tax, and overtime requirements. You can only do this if you know where your employees are. Employees should be obligated to notify their human resources team before moving. But you also cannot ignore reasonable suspicions that your employee moved.  

The Right Policies

You must ask yourself what your overarching strategy will be for complying with employment laws before you go remote. Assuming your employees work in different states, there are three main approaches for you to consider for multi-state compliance.

The first approach is to adopt policies and procedures strictly dependent on an employee’s location. In other words, you treat employees differently based on where they work. Each employee is subject to state-specific company policy. Under this approach, there might be a situation where your employees in Texas get no daily overtime for a twelve-hour shift while your employees in California will. Your employees in Michigan will be protected from discrimination based on weight, while your employees in Georgia will not. 

This approach can work, but it’s exhausting. Your human resources team will be stretched thin. You’ll probably need a separate employee handbook for each state. At a minimum, you’ll need a robust, state-specific appendix to the employee handbook. You’ll also need to count on your human resources team to keep up with state law changes. 

The second approach to multi-state compliance is to adopt a one-size fits all solution. Under this approach, your policies and procedures comply with the most challenging and employee-friendly laws (in most cases, that means complying with California law) where your employees reside. The advantage of this approach is its simplicity. It’s easier to implement and monitor, and you can be reasonably confident you’re staying compliant.

In other words, an employer can provide more protection than is legally required. If you protect employees in Texas from weight discrimination, even though there is no such law in Texas, you’re complying with Michigan law, and nobody in Texas will be disappointed. 

A one-size-fits-all approach can also help company culture. Employees talk. When they do, they’ll eventually become resentful if they discover their colleagues in other states get better treatment. Employees don’t like it when their California colleagues get additional sick leave or their Colorado colleagues earn more overtime. 

The third approach to multi-state compliance is a hybrid solution. Under this approach, a company adopts uniform policies but adds a few caveats for employees in certain states, usually through an addendum to the employee handbook. Generally, this approach will focus on ironing out state-specific policies for sick leave, pay, and other significant sources of liability.

The method that makes the most sense for you will depend on where your employees work, what your business does, and what your company can afford. We would all love to give our employees as robust benefits as possible. But not all companies can afford this. 

No matter what approach you adopt, note in your policies and handbook that the law controls to the extent that policies conflict. That caveat is not a license to ignore laws in drafting policies. But it is an acknowledgment, especially in a remote work environment, that keeping up with each state’s law is a process, and you reserve the right to course-correct when your policy gets it wrong. And I promise that you will sometimes get it wrong. 

In my next blog article, we’ll take a look at some of the reasons why.