One of the advantages of remote work for many people is the ability to work from home, wherever that may be. The vast majority of remote jobs, however, require a person to be based in a specific location, which most people are unaware of.
Remote work, which was once a benefit that employers used to entice candidates, has now become standard practice in many industries.
People often confuse remote jobs with “work from anywhere” jobs. Although these types of jobs do exist, the reality is that 80% of the remote jobs found by our researchers have geographic requirements, whether it’s a specific state, city, country, or even region of the country.
Legalities and State Taxes
When hiring out-of-state workers, employers must jump through more government hoops. Every state in which the company has employees will require the company to register with local and state tax agencies, as well as pay taxes in those states. They’ll also need to double-check that they’re following the proper procedures for each state’s labor and unemployment offices.
One of the main reasons for state hiring restrictions, is employment tax laws, like everything else, differ by state – and even city.
Furthermore, employers must provide workers’ compensation and unemployment insurance to all employees. States are in charge of these programs, which can vary greatly.
Work in the Office
Some businesses may transition to blended remote work models as they work to figure out their new normals post-pandemic. This means that some employees will work from home on a part-time or occasional basis.
Licenses, registrations, and certifications
A company that hires someone from another state must be registered in that state. Because of the paperwork and fees involved, the company may decide against hiring workers from another state.
Medical professionals, lawyers, and teachers, for example, require in-state certification or licenses. As a result, if an employer wants to hire someone from another state, they must hire someone who is licensed in that state.
A home occupation permit is also required in some states for remote employees. Companies seeking to hire out-of-state workers may run into a slew of local city or county ordinances that govern such permits.
Some jobs require employees to live near their current or prospective clients, particularly sales and project management positions that require multiple in-person meetings to close deals or update stakeholders.
Health Care Coverage
Group plans can be regulated by health insurance companies based on the number of employees a company has in a given state. As a result, some businesses are unable to participate in group plans because their workforce is dispersed across the country and they do not meet individual state requirements. Companies that qualify for group plans, on the other hand, may not be able to provide benefits to remote employees who do not live or work in the same state as the company. Companies can get around this by offering an individual or group healthcare contribution or reimbursement plan.
States also differ in their definitions of family members and marriage laws, further complicating healthcare eligibility. Because employers must follow each state’s healthcare regulations, there may be discrepancies in what they can provide to their remote workers.
Time Zone Requirement
If a company wants its employees to collaborate virtually in real time, it may require them to live in specific time zones to ensure that work hours overlap and synchronous communication is possible.