Employing Remote Workers from Different States

            Over the last few years my law practice has grown and we have added new employees. When I first started out, there was one employee, and it was me. I did everything. But I learned over time that if I wanted to improve my services and grow my profitability, I would need to add people strategically.

            So over time that is exactly what we have done, and it is no surprise that we have been able to service more clients more efficiently.

            I don’t think the legal business is much different from other businesses in that regard.

            One of the concepts I learned and embraced more fully during and after the Covid pandemic was that employers were no longer restricted geographically in hiring employees. When I needed particular project work done, I could hire from around the world, and I did.

            When I had an opening last year for an office assistant, I was not limited by searching for folks within a certain distance radius from my office. My office after all is remote and the folks I could choose from could also be remote. We ended up hiring an employee who resides in Topeka, Kansas, and the employee has worked out fabulously for us.

            As a sidenote, the employee is a graduate of the University of Kansas, and we therefore have a nice competition going between the employee’s Kansas Jayhawks and my UConn Huskies.

            There are many other employers who have decided to hire outside the borders of the state of Connecticut. And I assume there are plenty of Connecticut residents who have taken the opportunity to work for employers outside the geographical boundaries of the Nutmeg state.

            As an employer, though, when you hire an employee who resides in another state, you have to familiarize yourself with the employment rules of the state where the new employee resides. Most states have their own employment regulations in addition to the federal government’s standards. A failure to comply with a state’s standards could lead to hefty fines and penalties.

            I was reading this week about Massachusetts law regarding employment and payment of wages. No doubt there are lots of Connecticut employers who employ Massachusetts residents remotely.

            The writer of the article that I was reading called the Massachusetts wage law Draconian because an employer’s violation of the law could lead to liability for triple damages and payment of attorney’s fees.

            Some employers wrongly assume that the applicable law to an employment relationship is governed by the laws of the state where the employer is located. However, that is not always the case.

            In order to protect themselves, employers should draft contract language that specifies that if any dispute arises between the employer and the employee, the dispute will be governed and controlled by the laws of the state where the employer is located, not where the employee is located.  

            That language must be specific and identify the particular statutes of the employee state that will not apply to the employment relationship. So in the case of an employee from Massachusetts, an employer should include a provision specifying that Connecticut law applies and that the Massachusetts wage and hour statutes do not apply.

            There are benefits to hiring out-of-state employees, but employers need to be aware of the application of law to that relationship.