March 4, 2019 Remote Teams and Compliance Issues

Working from home has become a norm for millions. It’s beneficial for companies as they get access to a larger talent pool and save costs.

March 4, 2019

According to Global Workplace Analytics, more than 4 million employees work from home at least half the time. They get more flexibility and an opportunity to maintain a better work-life balance.

However, no matter whether your employees work remotely or in the office, you should ensure compliance with the necessary employment laws. For example, employers should be careful with labor law postings. Even if your employees are working remotely, the law still requires you to provide them with mandatory labor law posters. Of course, in this case, you may experience difficulties with communicating these notices, so we decided to help you with some tips.

Remote Workers and Their Employment Rights

There is no specific law that would require you to provide your remote employees with labor law postings. The main thing is to communicate the necessary information, and the law doesn’t provide any details on how exactly you should do it. Therefore, you can use various formats so that your employees can choose from various options to read the notices. By providing the necessary information in different formats, you will also demonstrate your effort to inform workers, which may be important in employee disputes.

We suggest that you provide postings in the electronic format. The best choice is PDF files because employees can either download or print them easily. Make the postings available on your intranet or on the internet. In addition, you can make them available in a format of printed binders. Although some employers often shrink postings to adapt them to non-traditional types of workplace, we suggest that you don’t do it, as it may be illegal (for example, when dealing with the OSHA notice).

Laws & Compliance that Govern Remote Employees

1. Dealing with different states
   If your remote workers are from different states, complying with posting requirements may be tricky. In this case, you should figure out, which state laws should be taken into account. If an employee works in a certain state but not lives there, its laws usually govern such basic rights as overtime, minimum wages, and issues related to safety. However, sometimes, your employees may be covered by the laws of both the state where your company is located and the state where they live. Thus, the best solution is to provide both sets of postings.
2. Foreign qualification requirements
   Depending on the type of your business, you may also need to apply for foreign qualification. Foreign qualification is necessary for some types of limited liability companies if their employees work in another state. Sophia Campbell, an HR manager at College-Writers, explains: “Sometimes, you may be required to not only apply for foreign qualification but also to ensure further compliance by filing annual reports. These reports should be filed through a registered agent with a physical address in the state where your employees work.”
3. Regular office visits
   It will be much easier for you to prove that you’re in compliance with the Department of Labor requirements if your employees visit your office at least three times a month. Obviously, you should also make sure you display the necessary postings in the office. Nevertheless, if your employees cannot visit the office, we suggest that you provide them with postings in the electronic format.
4. Mind tax nexus
   The term “tax nexus” is used when referring to a company that has a tax presence in a state different from its principal location. Be ready to consider sales, income, and other tax laws of the states where your employees work. However, it depends on the type of work your employees do.
5. Foreign-based employees
   If your employees work from another country, the situation gets even more difficult. If you’re a US tax resident based in another country, you may use the 1099 form. However, if you hire non-US tax residents from another country, you may either pay them like a contractor or find a local payroll company to pay them like an employee. Unfortunately, the second option may not work in some countries, so if you choose to pay your employees like a contractor, make sure they provide you with a W-8Ben form. You will also have to withhold and submit 30% to the IRS.

Conclusion

Although remote employment offers a number of advantages for both employees and employers, it also involves certain difficulties when it comes to ensuring compliance with the necessary employment laws. In this case, it’s important to carefully consider the laws of a particular state or country to make sure you do your best to inform employees of their rights and follow the necessary tax regulations.

About the Author
Ester Brierley is a QA Engineer in a software outsourcing company, a seasoned content creator and virtual assistant for College-Writers, but thinking about her own entrepreneurial journey. Therefore, Ester takes online courses to improve her marketing skills. Follow her on Twitter.

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