26 JULY / AUGUST 2022 HUMAN RESOURCES Debra A. Mastrian Partner SmithAmundsen LLC dmastrian@salawus.com SmithAmundsen LLC is a Diamond Associate Member of the Indiana Bankers Association. Hiring Remote Employees in Other States Is your business compliant with other state and local laws? In today’s age of technology and innovation, more and more employers are hiring remote employees – those who live and work in geographic locations outside of where a business is located. Remote work offers advantages, including expanded access to a wider pool of employee talent and savings on overhead, but managing a multistate workforce can be challenging. First and foremost, it is essential to know the employment laws of the remote employees’ states, as well as any applicable local laws and regulations. Employers may be surprised to learn that they must comply with employment laws in those other states and sometimes the particular locality, if there is a relevant city or county ordinance. These state and/or local laws or regulations may govern: % Paychecks % Pay deductions and garnishments % Workers’ compensation % Unemployment insurance % Payroll and other taxes % Leave % Sick days % Employment posters or other required notices % Rest, meal and/or lactation breaks % Minimum wage and/or overtime % Drug testing % Termination % Employment paperwork % Background checks % Harassment and discrimination practices % Employment benefits. Paychecks and Payday Laws Payday laws set out the procedures an employer must follow when paying an employee (e.g., the timing or frequency of payments, including final paychecks) and define what constitutes “wages.” Some states include vacation pay, holiday pay, sick leave pay and severance pay as wages. An employer also needs to know if it is obligated to pay accrued but unused sick leave or paid time off upon termination. Indiana does not require employers to pay that upon termination, as long as the employer has a clear written statement in its policy (and assuming there is no agreement to the contrary with the employee). Not all states are the same, however. Some states require payment of accrued, unused leave. Some states also require a payday notice to be given to the employee or posted in the office space the employee will be working in. Pay Deductions and Garnishments Indiana restricts the types of deductions an employer may make from an employee’s paycheck. Only certain types of deductions are allowed, and an employer must
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