5 Questions to Ask Before Hiring a Remote, Out-of-State Employee
Do you plan to hire a remote, out-of-state employee this year?
If your answer is "yes," you are not alone.
It seems most leaders I'm talking to are either actively hiring or plan to recruit new, remote and out-of-state employees in 2022.
Because the labor market is tight, many employers will continue to hire employees who live and work in a separate State than where the organization is headquartered.
Hiring a remote, out-of-state employee is a great way to fill a recruitment need….and….it is also a tricky, complex process.
States differ significantly when it comes to compliance - from different paid sick leave rules to even when to pay a separating employee their final paycheck - State compliance rules are complex.
The good news is that if you answer these 5 questions prior to hiring a remote, out-of-state employee, you’ll be in much better shape from both a compliance perspective as well as the employee’s onboarding experience (which is key to employee retention!)
Before considering hiring a remote, out-of-state employee, definitely check out the answers to these 5 questions.
1) Does our organization have a remote work policy?
A compliant work-from-home policy is the foundation of an effective remote work program.
If your answer to this question is “no”, you’re in luck!
Here is a Free download for “How to Set Up a Compliant Work-from-Home Policy,” which includes:
A checklist of what to include in your compliant policy
Sample policy verbiage you can use for your policy
Best practices for effective work-from-home programs
A checklist of next steps on how to implement your policy
2) Have you set up out-of-state Payroll, including any applicable State withholdings and Unemployment Insurance?
It’s important to set up and account for applicable State income tax withholdings and unemployment insurance for employees who live and work in a State separate from your organization.
Most States make this process fairly straightforward and if you work with an accountant or bookkeeper, they are great resources for this as well.
Keep in mind that most States will require you to report your “new hire” as well. The quickest way to find out how to report your new hire to the State is to Google, “new hire reporting in…” and include the State’s name, i.e., “new hire reporting in Iowa.”
3) Where should you buy Workers’ Compensation insurance?
As expected, each State differs when it comes to setting up a Workers’ Compensation insurance policy for your new employee. For example, some States require you to set up Workers’ Compensation through the State only, whereas others allow you to buy from private insurers or to be self-insured.
A good place to start your research is with the Department of Labor or Industrial Commission in the State in which you need the policy.
4) What State compliance rules do I need to be aware of?
Depending on the State, there can be A LOT of compliance rules you need to be aware of. Most States vary when it comes to paycheck rules, paid sick time, voting leave, jury duty leave, anti-discrimination laws, and other types of leaves of absence.
Just like I recommend reaching out to an accountant/bookkeeper for setting up out-of-state payroll/unemployment insurance, I recommend reaching out to an HR professional to ensure you have the appropriate handbook policies in place to be in compliance in the new State where your employee is living and working.
5) What steps should I take to successfully onboard my new remote employee?
How employees are treated in the hiring and onboarding processes are critical to overall employee retention.
This is an area where you will definitely want to map out a plan, not only for hiring (interviewing, job offer, reference checks, etc.), but also for onboarding i.e. what specific action items do you need to complete….
……prior to the employee’s first day
……on the employee’s first day
…. within the first 30/60/90 days
…..within the first 6 months
Great questions to ask yourself when setting up your hiring and onboarding strategy are: How would I want to be treated as a new employee? What positive experiences have I had as a new hire that I want to emulate here? What negative experiences have I had as a new hire that I want to be sure to avoid here?
Do you need specific HR guidance on how to hire a remote, out-of-state employee?
Schedule an HR Strategy Session to get answers to your immediate questions and receive HR advice that is customized specifically to your organization and the States you operate in.
Ways to Work with Skye
HR Consulting: On-demand, project-based, and monthly retainer services available. Customized services so you can quickly offload HR tasks to an experienced HR pro.
Leadership Training: Interactive in-person or online training tailored to your organization. Build leadership skills with relevant HR & leadership training.
Employee Handbooks: Handbooks tailored to your organization’s unique values and focused on reducing State and Federal compliance risk.
HR Strategy Session: Get quick answers to your HR questions from an HR pro. Receive expert guidance and a clear plan of action to resolve your immediate HR issues.
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