This post was co-authored by Teresa Foltz, Senior HR Consultant with vcfo, and Amy Beckstead, Employment Attorney at Beckstead Terry, PLLC.
Remote Work Rockets Into Hyperdrive
The onset of COVID-19 pushed the already accelerating rocket of remote work into hyperdrive. The technology and framework for successful remote work models were in place but refined further as more and more organizations and individuals hopped onto the train by necessity. Still, many organizations remain new to the concept and continue to experience struggles, including how to adjust policies and actions and how to apply remote work models to internationally dispersed teams.
While much is the same for locally dispersed versus internationally dispersed teams, when it comes to deploying effective remote work models, there are differences and important considerations to be mindful of as well. Here, we examine several key areas.
Technology and Tools
The right technology and tools are table stakes for remote work models. Beyond a reliable internet connection, tools that promote efficient communication and collaboration are essential to effective remote work. These include business communication tools like Slack or Teams, project management tools such as Trello, Wrike, or Basecamp, and document management tools like SharePoint, OneDrive, or Google Drive.
Organizations should not assume, however, that all employees will intuitively understand how to best apply these tools or even that each tool performs the same from region to region. Be deliberate about up-front, refresher, and 1:1 training as needed to support comfort and efficiency. Additionally, policies should be updated or put in place to provide clarity on how these are (and are not) to be used.
Data and Device Security
Remote work presents significant data security issues because team members are working on personal devices and using Wi-Fi connections that are often less secure than the devices and networks that are under the control of IT personnel. Unless organizations take steps to confirm the security of remote work arrangements, working remotely may be putting the organizations’ own data at risk.
Remote work also increases the risk that a business will inadvertently mishandle the data of employees and customers. Data transmitted and stored by businesses must be protected, processed, and stored per regional regulations even if employees are using their own devices. For those with employees in the European Union, GDPR (General Data Protection Regulation) would come into play. The GDPR notes that “two keys to maintaining data protection when your teams are all working remotely are encryption and controlling access.” That means applying encryption options on device hard drives and saved files and the utilization of basic computer security steps. It also means limiting what data can be accessed and considering use of a virtual private network (VPN) to better shield particularly sensitive data. View the GDPR’s full content surrounding data protection and working remotely.
Businesses who are subject to the CCPA (the California Consumer Privacy Act) may be liable to California-based employees and consumers if they fail to take “reasonable security measures” to protect personal data from unauthorized access, theft or disclosure. The California Attorney General (who enforces the CCPA) has concluded that the CIS Critical Security Controls represent the “minimum level of information security” that companies should meet. Encryption is key to limiting exposure because the CCPA’s private right of action is limited to breaches of unencrypted data.
Some organizations with concerns about remote productivity have also looked to remote monitoring tools like keyloggers and software that tracks idle and working time to give them more confidence that employees are following the rules and satisfactorily using their time. These tools, however, come with heavy risks. First, a range of local, federal, and country or region-specific privacy laws come into play that dictate employee privacy rights and required monitoring notification practices. Additionally, the impact that such tools and practices will have on company culture must be considered. For example, a 2020 CPID Workplace Technology Study noted that “73% of employees feel that introducing technologies to monitor the workplace would damage trust between them and their employers.”
Remote Work Policies
Employees need and deserve clarity around what is expected of them when it comes to remote work. As such, employers must ensure that all policies carefully consider and specifically address their remote workers and answer important questions that include but are not limited to:
- Who is eligible to work remotely?
- What specific communication practices must be followed?
- What technology will be provided to support remote work?
- How will performance management and employee development practices be carried out?
- What work schedules must remote employees adhere to?
Additionally, organizations with international employees must ensure that their policies conform to the laws mandated by the area from which the employees provide their services. This could include employee leave issues, mandated training, performance management processes, and more. Other factors such as the percentage of time an employee performs their work from a remote location also come into play.
Compensation and Other Compliance Issues
State and region-specific laws can differ in defining how different types of employees are to be classified and compensated. Employers must be clear on the laws that affect their remote workforce, such as definitions of exempt- versus non-exempt employees, and the actions they need to take to ensure they remain in compliance. Examples of the variances in these laws include:
- Overtime Pay Obligations and Definitions – This could be daily hour thresholds, weekly work hour totals, tiered compensation rates, or other variables.
- Record Keeping and Work Permissions – This typically involves organizations ensuring that all hours are recorded and that supervisory permission is obtained before employees work overtime.
- Minimum Wage Rates – Different minimum wage rates may apply if remote workers reside in a different state than the one the company operates in. In cases where both a state and local minimum wage covers an employee, the higher wage generally applies.
- Payroll Requirements – Differences that range from the information that must be shown on paystubs, to payday frequency, and vacation/PTO accruals also come into play.
- More Stringent Labor Laws and Potential Corporate Taxation Issues – Before allowing an employee to work in a jurisdiction where the company doesn’t have operations (particularly in a foreign jurisdiction), the organization needs to familiarize itself with any unique HR laws that exist and be sure the organization can comply with them. In addition, the company should be organized to do business in that state or country and be set up to comply with all applicable laws. Outside of the United States, at-will employment is not the norm – and beware that allowing an individual to work in a foreign country could create a situation where the individual can no longer be terminated without cause and without severance payments. Finally, the organization should consult with a tax professional to see what effect, if any, employing individuals in different states or countries has on potential corporate taxation of the company.
Instilling Confidence in Remote Work Models
Remote and hybrid work models are proving to be highly beneficial for a diverse array of organizations. Don’t lose sight of the level of scrutiny and applicable laws that come into play as companies grow in size, beyond office walls, and across state and international borders.
Putting the right controls, policies, and communications practices in place makes most remote work models a low-risk and high-reward proposition. As companies expand remote work models in their organizations, seeking the advice where needed from experienced practitioners and experts from legal, HR, tax, and finance perspectives will ensure that all bases are covered and the stage is set for success.
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vcfo is a professional services firm making companies stronger by bringing the wisdom and experience of senior level Finance, HR, and Recruiting executives to each client engagement. Our team of consultants guides CEOs and business owners in making strategic decisions, optimizing operations, and providing people support.
Since 1996, vcfo has supported more than 5,000 clients nationwide with offices in Austin, Dallas, Denver, and Houston. It has been our privilege to work with many great teams in our 25 years. Partner with the vcfo HR team to navigate the complexities of remote work strategies and create the solutions that best fit your business and employees.
