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How Do State and Federal Employment Laws Affect Remote Workers?

Although the prevalence of remote work in the United States is relatively recent, increasing dramatically during the COVID-19 epidemic, remote workers have rights under both state and federal law. There even exists an extra layer of complications when employees reside in one state and work in another state, because it is then up to a court to determine which state law applies. Keep reading to learn more about how present-day laws in the United States approach the new question of remote worker employment rights. If you have questions about how the law may affect you as a remote worker, get in touch with a Marquette employment lawyer right away and we can explain in detail.

How Do State & Federal Employment Laws Impact Remote Workers?

When an employee resides in one state and the employer is based in another, several difficult questions can come up regarding which state law predominantly applies. Large questions such as unemployment insurance and workers’ compensation all differ by state. Smaller questions, such as what information needs to be included on paystubs, also vary in each state.

For instance, Oregon law pays overtime by the work week. An employee is entitled to overtime pay once they work more than 40 hours a week. California law, however, pays overtime by day, such that an employee earns overtime when they work more than eight hours in one day.

There are also tricky tax questions involved. Typically, employees need to pay taxes to the state where they live while earning income. That is, unless someone works in one of seven “convenience of the employer” states (Arkansas, Connecticut, Delaware, Nebraska, New York, Pennsylvania, and Massachusetts), in which case employees have to pay taxes where the business is located. As a result of this, New Jersey residents who commute to New York City have been paying income tax to New York for quite some time.

How Do Courts Decide Which State Law Applies?

In law, that is called a choice of law question, and it strongly depends on the specific facts of the case. The area of law involved has a lot to do with it. Regarding taxes, most often the law of the state where the employee lives prevails, with the seven exceptions already discussed.

In other areas, the law of the state where the business is located prevails. Workplace discrimination cases, for example, tend to use the law where the employer is based.

The case-by-case nature of choice of law questions can result in an uncomfortable degree of uncertainty, for both the employer and the employee. One way to address this uneasy ambiguity is to clearly and directly state in a document, like an employee handbook, which state law will govern.

Importantly, however, no matter the circumstances of your case, if you are a remote worker and believe you’ve been harassed, discriminated against, or have otherwise had your rights violated, Berger Law stands ready to fight for you. Contact us today so we can get started working on your case.

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