What should I consider when hiring and onboarding an employee in a new state?
By Michaela Aguilar, HR Coordinator, Trüpp.
It can be difficult to keep up with the numerous details involved with onboarding new employees. With the rise of the remote workforce, hiring and onboarding those in different states has become more frequent than ever before. In a 2016 study by Gallup, 43% of employees work remotely in some capacity. These numbers are quickly rising, making a 4% jump from the previous year . Companies hiring in multiple states must consider several additional factors when onboarding new employees.
1. State and Local Employment Laws
Many states and cities have laws, noticing, and posting requirements that extend beyond federal employment and labor laws. Some common areas where legislation varies include sick time, leave laws, meal and rest periods, and wage and hour. Before you bring on an employee residing in a different state, it is important to be aware of the laws that may apply. Make sure your company polices meet state and local requirements. This also includes ensuring appropriate state and local employment notices and posters are displayed and/or provided. For remote employees, these can oftentimes be posted electronically, such as on an intranet.
2. State and Local Taxes
Did you know that over half of the states have their own W-4? When sending your candidate new hire paperwork, include the relevant state W-4 alongside the federal W-4. You can see which states have their own W-4 on the Department of Labor website. It is important to ensure that your organization is set up as a business in that particular state and registered for a state income tax ID and state unemployment tax ID. Additionally, it’s important to note that some local jurisdictions may have additional employment taxation.
3. I-9 Verification and E-Verify
An important step in the new hire process is completing the Form I-9. The employer portion of this form must be completed within 3 days of hire, which includes an in-person review of the documentation supporting a new employee’s eligibility to work in the United States. This may be a challenge when doing a remote hire if you don’t have a company representative in the area. Luckily, most states (excluding California, Montana, and Texas) will allow employers to designate a notary as their employee representative. Be sure to provide your employee and the notary with clear instructions for compliantly completing the Form I-9. Additionally, some states require all employers to process hires though E-Verify (such as Colorado, Missouri, Nebraska, and Oklahoma).
4. Benefit Plan Coverage
Not all health insurance carriers operate at a national level. Ensure that your benefit plan’s network extends to the area you are hiring in. You will want to make sure the new employee has in-network options with your current plan. This may mean you need to expand your current plan or add a secondary carrier.
5. Establishing Culture
Policy and company culture training for employees spread across states is critical. Communicating the behavioral expectations up front for these employees is important because remote employees won’t have this modeled for them on a daily basis, as they would interacting with their team around the office. An initial conversation about your culture allows you to set the tone with these employees moving forward in their employment.