The post-COVID-19 world will likely see a major shift toward companies maintaining remote workforces.
Due to government-mandated business closures and stay-home orders, many owners and employees of small businesses have been forced to work virtually, and they have seen the benefits. Studies show that remote working increases productivity. Large technology companies like Facebook and Twitter have announced that they will be implementing remote working until at least September 2020. Some companies have even gone as far as to give employees the option of working from home permanently. The “new normal” that many predict involves more companies maintaining a remote workforce.
As a business owner, you may be exploring the idea of permanently utilizing a remote workforce; however, you may not be aware of all of the relevant factors to consider and preparations to implement. Be sure to take the following measures as you move toward permanent virtual employment.
1. Increase security measures for information stored in the cloud. As your company begins functioning in a paperless world, you must take appropriate steps to ensure data shared over digital cloud networks are secure. One way to increase security is to provide the specific tools employees will use in completing their tasks. For example, establish a policy allowing only company-issued phones and laptops to be used when handling work business. In complying with these measures, keep your team accountable by
- restricting the reception and transmission of company emails;
- requiring the use of secure passwords—passwords comprised of many characters, including symbols and numerals;
- providing guidelines regarding proper social media usage; and
- providing access to encrypted wireless networks.
By taking these additional precautions, a company addresses confidentiality concerns and further protects itself and its customers or clients from potential data breaches
2. Comply with federal and state wage laws. For business owners, understanding labor rules and laws that apply to specific situations is key for the successful implementation and continuation of a remote workforce. It is important to keep in mind that federal legislation requires employers to pay nonexempt workers for any work over forty hours in a single workweek. This is especially challenging for individuals classified as part-time workers, because tracking their time at home could be difficult and could result in a nonexempt worker exceeding the forty-hour cap. As a result, when working with a remote workforce, it is critical to create systems and structures that enable employees to indicate and record their start and end times. Additionally, most states have minimum wage requirements, with some exceeding the federal minimum wage of $7.25 per hour. If you have an employee who resides in a state whose minimum wage differs from the federal minimum wage, you are required to pay the higher of the two.
3. Pay applicable taxes. For employers with remote employees in more than one state, payment of state taxes is a key requirement. Typically, if you and your employees are in one state, you are only responsible for paying taxes in that state. However, this rule changes if your business has a nexus to another state as determined by that state’s law. The presence of an employee in a state usually constitutes sufficient evidence of such a nexus. In these instances, you are required to pay taxes in that state.
We Can Help
We are dedicated to helping you adjust and thrive in the post-COVID-19 world. If you have any questions about developing your remote work employee policy, do not hesitate to call our office. A dedicated attorney will be available to guide you through the process. We are happy to meet with you by phone or video conference if you prefer.
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This article is a service of Sky Unlimited Legal Advisory PC, Personal Family Lawyer® . We're not your traditional law firm, we stand apart from the rest by helping you make informed and empowered decisions on how to deal with your business throughout life and in the event of an emergency. We offer a complete spectrum of legal services, including a New Business Planning Session or an Existing Business Review Session, which includes a review of all the legal, insurance, financial, and tax systems you need for your business. You can begin by calling our office at (650) 761-0992 today or book online to schedule a Business Planning Session and mention this article to find out how to get this $950 session at no charge.
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