A total of 97.6% of over 2,300 remote workers all over the world surveyed by Buffer say they would like to continue to work remotely, at least some of the time, for the rest of their careers — but accommodating remote work comes with plenty of concerns for businesses, especially on the legal side of things. Whether you’re planning on staying remote permanently or moving to a hybrid work model after the pandemic, the key to staying compliant is to research and adhere to all applicable local, state, federal, and international labor laws for remote employees based on where your workers live.
Fair Labor Standards Act (FLSA) laws
The Fair Labor Standards Act (FLSA) covers all U.S. employees, regardless of where they work, with labor rights regarding minimum wage, overtime pay, and more. It categorizes employees as “exempt” or “nonexempt” (usually, but not always, salary vs. hourly) and explains which labor laws apply to each group.
Minimum wage requirements
You have to pay nonexempt employees according to minimum wage requirements based on where your employees work. If local minimum wage, state minimum wage, and federal minimum wage are all different, you’ll have to pay your employees whichever one is the highest.
The Department of Labor (DOL) considers remote work the same as onsite work when it comes to the FLSA. Employers must pay for all hours that they know or have reason to believe were worked, even unscheduled hours, as long as they’ve been approved. Remote work also covers overtime, which must be compensated at 1.5 times a nonexempt employee’s wage for any time above 40 hours per workweek. However, employers don’t need to pay for unexpected, unscheduled hours that they don’t know about.
Staying compliant with these requirements can be difficult, as tracking your remote employees’ hours can be challenging. Put a system in place for your nonexempt remote workers to keep track of the hours they work, whether with time tracking tools or spreadsheets, and ensure that no one works overtime without their supervisor’s permission.
Federal regulations under FLSA cover what breaks given to nonexempt employees need to be paid while leaving itup to each state to determine whether or not to require employers to provide them. Meal breaks are required in 21 states, Puerto Rico and Guam, while rest breaks are required in nine states. If you provide them at all, FLSA says you have to pay for rest periods that run from 5 to 20 minutes, and meal breaks don’t have to be paid, but they can’t be interrupted.
To stay compliant, research what breaks are mandatory based on where your employees live.
The FLSA defines exempt employees as those who make a fixed salary of $684 or more per week, with the threshold higher for those in certain places, like New York City at $1,125 per week in 2021 and Maine at $735.59 per week as of Jan. 1, 2022.
Exempt employees are just that: exempt from most FLSA protections, except for their right to be paid their guaranteed salary for any week in which they perform some work. That means even if your exempt employees work only a few hours a day while napping the rest away, you still owe them their full wage … though you should still be able to establish clear work expectations to prevent such situations!
While you may be tempted to use employee monitoring software to keep tabs on your remote workers and measure their productivity — and the law allows you to — you may want to consider liability concerns before doing so.
Remote employees generally don’t have many rights to privacy at work, especially if they’re using employer-provided equipment, networks, and email accounts. As Forbes puts it, “most employers can legally monitor what you do while working as long as it’s for legitimate business purposes or they have your consent.” With a BYOD (Bring-Your-Own-Device) policy in place, employee monitoring may extend to personal equipment, too, which constitutes a privacy concern for those who work from home.
Only two states, Connecticut and Delaware, require employers to inform employees before electronically monitoring them, but you likely want to let your employees know anyway for their own benefit.
Some privacy laws govern how you can handle employees’ personal information. In particular, keylogging and screen capture tools could unintentionally collect employees’ Social Security Numbers, usernames and passwords, medical info, credit card numbers, addresses, and more — highly sensitive information that employers legally must protect.
As with most laws, your mileage may vary by state: for example, California grants all employee and contractor personal information full protection under the California Consumer Privacy Act (CCPA), while some states have specific laws governing employees’ social media privacy rights.
However, employee monitoring could be detrimental to employee morale and workplace culture if perceived as overly intrusive or mistrusting. If you implement employee monitoring, make sure to establish a work policy that explains how and why you’ll be doing so.
Both federal and state laws mandate how much leave you must provide to your remote employees.
Paid and Unpaid Family or Medical Leave
Under the Family Medical Leave Act (FMLA), employees are entitled to up to 12 weeks of unpaid, job-protected leave for specified family or medical reasons, such as the birth of a child.
- work for a covered employer for over 12 months (not required to be consecutive)
- work for at least 1,250 hours over the past 12 months, and
- work at a location where 50 or more employees are employed within 75 miles
Are remote employees eligible for FMLA leave? Maybe.
According to the text of FMLA, a home office doesn’t count as a place of work: “An employee’s personal residence is not a worksite.” Instead, “their worksite is the office to which they report and from which assignments are made.” However, employment lawyers say that as long as an employee’s worksite employs 50 or more employees within 75 miles, a remote employee can take FMLA leave.
Under the current wording of the law, it seems like fully remote companies or smaller hybrid companies with fewer than 50 employees within 75 miles reporting to a worksite might not need to provide FMLA leave. That’s pending further guidance from the Department of Labor and the courts, of course. If you’re unsure whether you need to comply with FMLA, seek legal counsel.
However, it may be a good idea to offer unpaid or paid family leave anyway to stay competitive as a desirable place to work. A McKinsey study found that prior to 2020, 64% of companies offered “unpaid leave beyond legal requirement,” and this number increased to 82% after 2020.
Paid family leave (PFL) is mandated in nine states and D.C., though the guidelines for eligibility and amount of leave allowed may vary. In New York, for example, employees can take both paid and unpaid family leave concurrently but can’t add PFL leave to extend their FMLA leave.
Even though remote employees don’t risk getting their coworkers sick if they come down with a cold, they still might not want to log on for work. Federal law doesn’t require sick leave, but 20 states and D.C. have state or local paid sick leave laws, so do your research based on where your employees live.
Don’t fall into the trap of thinking that your employees aren’t eligible for workers’ compensation just because they’re remote. Lack of control over the conditions of work premises is irrelevant because employers are responsible for providing a safe working environment for all their employees regardless of where they work. That means if a remote employee slips and falls at home while getting a coffee while teleworking, they may still be eligible for workers’ comp. It would depend on if they sustained injuries that “arise out of and occur within the course of employment.”
Depending on where your company and employees are located, evaluate what coverage to obtain and which claims apply case by case.
Labor law posting notices
Specific federal laws, including discrimination laws, FLSA, and FMLA, require employers to post notices at all times in a conspicuous location to advise employees of their rights. But for remote employees, there’s no central break room where they can see those posters, so you’ll have to go about fulfilling posting requirements differently.
According to the DOL, electronic postings, like on a company wiki, are acceptable only when all employees exclusively work remotely, usually receive information from their employer electronically, and have readily available access to the posting at all times. Individual notices, such as via direct email, are allowed only if the employee usually receives information from their employer electronically.
You also must inform employees where and how to access the notice electronically. Posting it in a rarely visited or unexpected location has the effect of hiding the notice, like putting up an FMLA poster in the office broom closet.
Other states, like California, may have additional workplace posting requirements, so it’s best to check what regulations may apply.
International labor laws
Employment laws vary widely across the globe, from vacation law to paid parental leave and more, so you’ll have to check the laws for remote workers in the specific country where you’re hiring. It’d be impossible to cover every country’s labor laws in this compact guide — though we’ve covered Brazil, Poland, Spain, and more on our blog — so we advise you to do your own research based on your unique business needs.
Global compliance becomes a concern when hiring international employees because generally, most countries require that you draft an employment contract that complies with their laws. That can be challenging, which is why we recommend hiring a team like Pilot to make sure your contracts adhere to all applicable laws across borders.
Compliance empowers your remote workers — and your business — to succeed together
Remote work is a huge success and is here to stay, so having a strategy in place to handle compliance with all these labor laws will cover you and your remote workforce for years to come. Pilot’s HR experts and lawyers can handle the nitty-gritty details of figuring out compliance and the applicability of domestic and international labor laws for you, enabling your work-from-anywhere team of superstars to focus on doing their best work — contact us today to discuss how.
⚖️ Legal Disclaimer: The information contained in this site is provided for informational purposes only, and should not be construed as legal advice on any subject matter.