The world of work was transformed literally overnight at the start of this decade. While some employers had been slowly transitioning to remote or hybrid work for some time, the onset of the COVID-19 pandemic forced companies that had never even considered the prospect to go fully remote immediately.
Remote work is here to stay
With the era of lockdowns now in the past, a “new normal” is setting in. Some employers have embraced the distributed workforce model and found that hybrid or fully remote teams are to their advantage. Others face the reality that some employees do not want to return to the office full-time. A Gallup survey recently found that three in ten employees who are currently remote would look for another job if required to return to the office. In fact, a growing number of workers are already doing so. As a result, employers are confronting a more competitive market for the best workers, who can now seek positions beyond their geographic area.
HR changes resulting from a distributed workforce model
While the trend toward remote work can benefit employers and employees, it creates new HR challenges for managing remote employees. HR departments must comply with the patchwork of varying benefits, leave of absence, compliance, workers’ compensation, and payroll tax laws across many states. In addition to these regulatory hurdles, the lack of a shared physical space can impact organizational culture.
Here are seven important HR considerations that must be addressed when employing remote workers:
1. Policy and employee handbook updates
The rise of remote work means your policies and employee handbook must be updated. You will typically deal with workers in multiple states, each with unique requirements. Companies must adhere to state-specific employment laws. This usually means following the state’s regulations where the employee is physically working.
There are two common approaches to making sense of the mishmash of state requirements:
- Provide a primary employee handbook with separate state addendums.
This assures compliance but can be a lot of work, and it can also be a challenge to keep it up to date as laws change.
- Base company policies on the most generous state requirements.
This is easier to create and can help with morale and retention but it also adds to the cost. Some employers opt to include carve-outs on certain items not required in every state.
2. Payroll considerations
Payroll for remote employees is a particular challenge. Each state has its own requirements for payroll taxes, tracking work hours, meals and break periods, and other factors. Errors in multi-state payroll processing can leave employers vulnerable to compliance issues and even litigation.
- Payroll taxes.
A company should apply for a state tax ID number when it hires someone physically located in that state so taxes may be paid before the new hire’s first payroll cycle.
- Hours worked.
Without being able to glance over a cubicle wall or peek into an office, managers of remote employees cannot truly know how much an employee is working. This is particularly challenging when tracking hours for hourly or non-exempt remote employees. Setting up a timekeeping system and maintaining a clear policy on hours worked is essential. Have new hires sign an acknowledgment that they understand the policy.
- Meals and breaks.
There are no federal laws on meal and break periods, but some states have strict requirements for hourly, non-exempt employees’ break times. Make sure employees are logging this time accurately and documenting their breaks.
- Final paychecks.
The legal requirements vary by state regarding when employees must receive a final paycheck. Employers must generally provide final wages on the last day of employment and may utilize direct deposit. If choosing direct deposit, it is necessary to get an acknowledgment or written consent from the employee. Failure to comply can result in fines and litigation.
3. Employee benefits
Your employee benefits offering is a vital tool for attracting and retaining employees. However, not all benefits offerings are transferable across states, which adds to the complexity for HR professionals.
- Health coverage.
It can be hard to make equitable offerings across multiple states with their own requirements for what health insurers must provide. A broker can help you understand state-specific health insurance laws. It is also essential to communicate effectively with your employees about open enrollment. Many employers conduct open enrollment virtually, even for on-site staff. The brokers they use can also assist in open enrollment for off-site employees.
Some states require employers to reimburse telecommuting costs, and some employers choose to make this a companywide benefit regardless of employee location. Make sure your employee handbook covers your reimbursement policy.
- PTO and sick time.
States have specific paid time off (PTO) and sick time laws which may include carry-over provisions or require unused PTO to be paid out to employees upon separation. Your employee handbook should cover state-specific requirements, as well as companywide PTO and sick time policies.
4. Leaves of absence
While the federal Family and Medical Leave Act (FMLA) applies to all employers with 50 or more employees, many states have laws that cover other employers or expand paid leave benefits beyond the scope of FMLA. A small error in processing an employee leave of absence can result in action by the federal Department of Labor, claims with the federal Equal Employment Opportunity Commission (EEOC), and state-level claims.
While most states offer funding to cover paid protected leave, it is not always automatically made available. Some, like New York, require the purchase of a PFL (Paid Family Leave) insurance plan based on an employee’s working location.
No federal law requires employers to provide paid sick leave, but as of this writing, ten states and several municipalities mandate paid sick leave.
Regulations vary considerably from state to state, so HR professionals must understand the federal and state-specific requirements of every state where employees work.
6. Remote onboarding
How do you welcome someone to the office when they don’t come to the office?
Onboarding is about more than paperwork and expectations. It is also the time to introduce new hires to their peers and acclimate them to the company culture. This can be a real challenge when they meet their colleagues via screen, and the company water cooler is a chat window.
You can make the remote onboarding process work well for both you and your new hire by following a few simple steps:
- Deliver equipment promptly.
Send all required equipment to the employee before their start date, so they can be prepared to “step into their office” on Day One. Be sure to get your new hire all notices and postings specific to their state and municipality.
- Set up for remote signatures.
Send new hire paperwork for electronic signature. Set a process for handling this paperwork, including completing the required federal Form I-9 on the first day of employment.
- Review policies.
Walk your new employee through company policies, especially remote work policies, in detail. In addition to performance expectations, communication considerations, workspace standards, and security and confidentiality requirements, this walkthrough should include your company’s cultural and behavioral norms.
- Set a reasonable pace.
Make sure to give your new hire plenty of breaks during the onboarding sessions. They will receive a lot of information and need time to process it to avoid becoming overwhelmed. It is also counterproductive to cram information into a new hire’s head so quickly that they will not retain it.
- Provide reassurance.
Keep the process friendly and welcoming, and allow plenty of time for questions. The physical distance of remote onboarding can be intimidating for new employees and ensuring they are reassured and comfortable is essential.
A successful remote onboarding will balance detail with time for acclimation. An ideal general onboarding should take about one work week, with additional weeks for role-specific training.
7. Remote employee separations
Employee separations are always challenging for HR professionals and can be even more difficult with a remote employee. Try to meet with the employee in person. If this is not possible, conduct a separation meeting via videoconferencing or phone. Delivery of news of separation via email is not recommended.
- Ensure the return of company property.
Provide the employee with clear instructions on how to close out of their work activities and return company property. This may involve coordination with your IT department and may mean the employee will be contacted by IT even after the date of separation. Because the employee may be upset about the news of separation, these conversations should be handled sensitively and directly.
- Comply with state-specific final paycheck requirements.
During the separation meeting, communicate with the employee about their final paycheck. Get an acknowledgment or consent from the employee in writing if the final paycheck will be by direct deposit. Requirements vary by state, so be sure you understand them before the meeting.
- Provide a separation contact.
At the close of the meeting, provide the employee with a company contact they can reach out to with questions that may come up or they didn’t think to ask during the separation. Ensure the company contact is aware of their responsibility and that all questions from the employee go to them.
- Disable access to company systems and platforms.
On the same day as the separation meeting, remove the employee’s access to all company systems, accounts, and applications. Disable all accounts they have created or been given access to, and change any relevant shared passwords.
You’ve got this!
Establishing a remote work team and managing remote employees can be challenging, but it can also benefit your company’s future and even its survival. The world of work has changed, and with that change come new opportunities for expanding your recruitment candidate pool, the diversity of your work team, and your organization’s scope of business. With the right tools and approach, your company can thrive in the new era of remote work.