Why ‘wandering’ employees are creating legal headaches for HR

While remote work has been embraced by many employees, it also has produced an unintended consequence for HR leaders.

Consider that more than 15.9 million Americans moved last year during the pandemic, according to the U.S. Postal Service. Likewise, a recent survey from real estate brokerage Redfin reveals that “two-thirds of homebuyers and sellers would consider moving—or already have moved—to a different city or area given the opportunity to work remotely permanently.”

Unfortunately, not every employee who moved notified HR in advance. In the wage and hour space, that’s a big deal. Employment laws can vary drastically among jurisdictions. What’s legal in one state or city may not be in another. Some HR professionals have found themselves in sticky situations that were potentially expensive, complex and chaotic.

One New York employer recently discovered that two of its IT staff had relocated to Minneapolis nearly a year ago, says Claire Deason, shareholder of Littler Mendelson law firm. Since the overtime laws differ between the two states, she says, it’s “highly likely” that these two employees will be entitled to retroactive overtime.

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Deason hasn’t seen any lawsuits involving “wandering employees”—yet. But HR can take precautions by observing these three steps:

  • Account for everyone’s current remote work location. Whether you inquire via email or ask them to complete a form, make sure workers understand this isn’t something they can ignore. Then form an HR project team to handle and solve any surprises on a case-by-case basis.
  • Develop a remote work policy that sets parameters for where employees can work. Clearly state that they must seek permission ahead of time to move to a location that isn’t on HR’s list or risk termination.
  • Require employees to sign an agreement verifying their work location.

Other legal problems related to the pandemic involve reimbursable home office expenses, which have exploded in California, says Deason. Although the state’s law is “somewhat vague,” she says, with each court interpretation, what’s reimbursable and what isn’t becomes clearer.

Meanwhile, Deasolan says, HR must keep tight control over where remote employees are working. She adds that some companies have created a “no-fly list,” or a list of states that are taboo or off limits to employees because of their compliance rules and regulations.

At the least, she says, wandering employees have created an administrative challenge for HR. The U.S. Department of Labor alone administers and enforces more than 180 federal laws.

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“It’s not just [that HR has to] be aware of state laws,” Deason says. “The real challenge is how can you know ahead of time so that you can get prepared to be compliant.”

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