Remote Employment 101: A Successful Compliance Structure

The number of remote workers has increased, and companies are going outside of normal state boundaries to find top talent. These quick changes have spotlighted the issues surrounding this employment relationship over the past two years. Throughout this series, we have highlighted some considerations that every business owner should pay attention to with remote employment. This final blog covers important compliance areas that should not be ignored.

Separation of Employment

Employers may not realize this, but most states have requirements regarding documentation that should be provided to employees upon separation of employment. While COBRA applies to private companies with 20 or more employees, many states have mini-COBRA rules in place that apply to smaller companies.  As a result, plan participants should be provided election notices upon termination.  Additionally, many states require employers to provide notification to departing employees about the potential availability of unemployment insurance benefits. 

Worker’s Compensation

Companies may take it for granted that their worker compensation policies will cover remote workers no matter where they work, however, worker compensation is generally governed by state law.  As a result, it is crucial to check with the insurance carrier to ensure that any employee working remotely is covered.  In some instances, companies may need to purchase separate policies or buy one that covers all states.  

Sexual Harassment Training

More companies than ever have recognized the importance of developing policies to combat harassment and discrimination.  Some states have specific requirements as it relates to training on this topic.  Employers need to pay attention to the specific requirements in each jurisdiction since, while similar in some ways, there are some differences in the content of training that is required.  California, Connecticut, Delaware, Illinois, Maine, New York, and Washington all have laws on the books that require sexual harassment training – and each differs in terms of its requirements. 

Employee Handbooks

The complexity of navigating the requirements of different jurisdictions makes it even more important that companies craft well-developed handbooks. A well-developed handbook provides employees with an overview of the policies within the organization and should serve as a guide for employees to follow throughout their tenure. Incorporating differing state laws into company policies can be handled in different ways.  One method is to create a single handbook for general company policies and include an addendum for each state with state-specific policies.   A second option would be to ensure that the company’s policies are broad enough that they are compliant with the different state laws’ requirements. Alternatively, companies may choose to create a different handbook for each state in which employees are working. Of course, this decision will depend on many things such as the number of employees and states involved. 

Multistate employers undoubtedly have a lot to think about when making decisions about how to follow the different requirements that apply to remote workers.  Often state and local laws may contradict each other.  The time to figure out how to best navigate these situations is early on when employing remote workers.

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