Download the Guide: Solving for Multi-State Compliance
Use this guide to consider the tradeoffs of a remote workforce on your HR compliance and manage your multi-state compliance.
Two years into allowing employees to work remotely and many businesses are choosing to stick with it permanently. There are many benefits of remote work, but one of the drawbacks can be the impact it has on HR compliance issues.
Overall, employee claims against businesses are increasing. Just because you don’t have workers in an office, doesn’t mean your liability is reduced—in fact, it can increase. The same litigation claims business are used to seeing are increasing, but approached from a different angle because of remote work.
As a result, remote work and human resource compliance can get pretty complicated. Here are the most common HR compliance issues you may be up against if you have remote workers—and how you can protect your business from them.
Wage and hour laws vary significantly by state. Specifically, not only states, but different cities will have different minimum wage standards. With remote workers, it can become especially hard to track employee locations and wage requirements.
Employee classification also becomes more important with remote workers. If a non-exempt employee is working from home, accurately tracking time can be difficult to do. But even if a worker is remote, they are still entitled to pay for all hours worked—including overtime. To avoid human resource compliance issues with remote workers’ wages and hours:
Most cases have proven that employers are liable to provide workers’ compensation for an injury an employee suffers while working from home. The way the work environment is currently defined under the Occupational Safety and Health Administration includes remote employees’ environments; However, this can be subject to interpretation.
To limit confusion and interpretation of workers’ compensation laws, employers should:
A lot of people think that harassment and discrimination are less of a problem when employees work from home. But that’s not necessarily the case. Just like cyberbullying on social media, employees can feel the effects of harassment and discrimination virtually.
For example, coworkers wearing inappropriate clothing or displaying objects that others find offensive is considered harassment. Discriminatory language and comments can still be shared over web meetings and chat too. And, if you have some workers who are fully remote and others who are hybrid, employees can feel they are getting a different employee experience and treatment than others.
To avoid a difference in treatment becoming an issue of discrimination, make sure you don’t offer different benefits or terms of employment to different groups based on discriminatory criteria. Your remote work policy and handbook should define telecommuting options based on the type of work performed, employee classification, and location of the employee or office.
Human resource compliance becomes more complex for a remote workforce, but even more so for a geographically diverse remote workforce. Your legal obligations can more than double the second you allow one worker to live in a state different from your primary location of business.
Payroll, taxation, benefits, wage and hour, and discrimination and harassment laws vary from state to state. So the HR compliance issues above can quickly become more challenging to follow—but not impossible. Companies who want to take full advantage of remote work and allow workers to live in other states just need to take some additional steps to ensure compliance.
A comprehensive remote work policy that covers each of the areas above will help you maintain HR compliance with a remote workforce. Namely, make sure your policies cover the following areas in depth:
Thankfully, tackling HR compliance on your own isn’t a burden you have to deal with. Obsidian HR can keep you informed of changes and be a resource for how to get compliant. We’re here to answer questions, advise on best practices, and help you strategize and plan. We’ll even conduct regular reviews and audits of your HR policies and procedures, or help you create them from the ground up. Reach out to us to learn more!