Setting Up or Auditing a Remote Work Arrangement: A Practical Checklist

Labor and Employment > Remote and Multistate Work | Published 26 November 2024 - Updated 10 July 2026 | UpLaw - uplaw.us

How to Use This Checklist

Parts 1 through 3 establish control. Parts 4 through 9 run the per-state and per-employee work. Part 10 handles the unannounced move. Part 11 is the annual audit. Doctrine behind any item is in the comprehensive guide; the narrative introduction is how remote work law actually works.

⚠ One control prevents most of this. Nobody changes work location without written approval, and approval issues only after the compliance check. A manager saying "sounds great" is not an approval, and training managers to say so is the single highest-value step here.

Part 1 — Build the Location Roster

☐ Record, for every employee, the state and city where work is physically performed, not the address in the personnel file.

☐ Record the designated worksite to which the employee reports and from which assignments are made — this drives leave eligibility and layoff notice obligations.

☐ Record the classification (exempt or non-exempt) and the state threshold it was tested against.

☐ Record the date of the last compliance check for that jurisdiction.

☐ Reconcile the roster against payroll addresses and benefits enrollment addresses.

☐ Assign one owner for the roster, outside the reporting line of the managers who request changes.

☐ Decide which states the company will support, and treat expansion as a deliberate decision.

Part 2 — Write and Publish the Policy

☐ Approved locations, and advance written approval required to change them.

☐ Obligation to report and update the work address.

☐ Worksite designation stated for each employee.

☐ Timekeeping: all time worked must be recorded; off-the-clock work prohibited; a stated, consequence-free process for reporting unrecorded time.

☐ Break requirements where applicable, and how they are recorded.

☐ Expense reimbursement: what is covered, the amount or method, and how to submit.

☐ Equipment: what is provided, permitted use, care, and return.

☐ Security: network, device, and physical requirements in the home, plus incident reporting.

☐ Monitoring: exactly what is collected, when, and why.

☐ Availability expectations, written so they support rather than undermine the timekeeping rule.

☐ Accommodation requests: how and to whom.

☐ Safety: workstation self-assessment and injury reporting.

☐ Right to end the remote arrangement with notice.

☐ Acknowledgment collected and retained.

Part 3 — Train the Managers

☐ One sentence: "I can't approve a change of work location — here's who can."

☐ Do not expect or send messages to non-exempt employees outside recorded hours.

☐ Route accommodation requests immediately rather than resolving them informally.

☐ Report any indication that an employee is working from somewhere else, including travel that becomes extended.

☐ Do not approve equipment purchases or reimbursements outside the policy.

☐ Understand that a supportive reply creates obligations, and that the fix is a redirection, not a refusal.

Part 4 — Per-State Onboarding: Payroll and Entity

☐ Register for state income tax withholding before the first payroll; the federal framework is at 26 U.S.C. § 3401 and 26 U.S.C. § 3402, with employment taxes at 26 U.S.C. § 3121.

☐ Register for unemployment insurance in the state assigned by the localization test.

☐ Determine local and school district withholding by the employee's specific address.

☐ Check reciprocity and obtain any required employee certificate.

☐ Determine whether a convenience-of-the-employer rule applies to a nonresident.

☐ Assess corporate income tax nexus and any sales tax collection obligation.

☐ Qualify as a foreign entity where required; appoint a registered agent; calendar annual reports.

☐ Configure the payroll system for rates, remittance schedules, and pay statement content.

Part 5 — Per-State Onboarding: Wage and Hour

☐ Identify the minimum wage, including city and county rates.

☐ Identify the overtime formula, including daily thresholds, double time, and seventh-day premiums that do not exist under 29 U.S.C. § 207.

☐ Identify meal and rest break rules, including timing, pay status, and premium for a missed break.

☐ Identify the expense reimbursement duty, noting that the federal floor at 29 C.F.R. Part 531 is narrower than many state statutes.

☐ Identify pay statement content requirements and the penalty structure.

☐ Identify pay frequency and final pay deadlines, including waiting-time penalties.

☐ Determine whether accrued vacation is wages at separation.

☐ Retest exempt classification against the state salary threshold and duties test, comparing to 29 U.S.C. § 213 and 29 C.F.R. Part 541.

☐ Confirm recordkeeping satisfies 29 U.S.C. § 211 and 29 C.F.R. Part 516.

Part 6 — Per-State Onboarding: Insurance, Leave, and Notices

☐ Add the state to the workers compensation policy before the first day of work, and confirm any state fund requirement.

☐ Confirm employer liability coverage extends to the jurisdiction.

☐ Register for any state paid family or medical leave program and configure contributions.

☐ Configure paid sick leave accrual to begin on the first day of work in the jurisdiction.

☐ Identify additional protected leaves — school activity, domestic violence, bereavement, voting, jury duty.

☐ Confirm federal family leave eligibility by reference to the designated worksite under 29 U.S.C. § 2611 and 29 C.F.R. Part 825, not the employee's home, and confirm the entitlement at 29 U.S.C. § 2612.

☐ Issue any wage-rate notice at hire and on change.

☐ Deliver required postings electronically and collect acknowledgment.

☐ Confirm handbook provisions that vary by state — leave, breaks, reimbursement, at-will language, arbitration where restricted.

☐ Confirm restrictive covenant enforceability in the state, and whether presenting the agreement is itself restricted; see trade secrets and restrictive covenants.

Part 7 — Timekeeping and Pay Systems

☐ Provide timekeeping accessible from anywhere the employee may work.

☐ Publish a consequence-free process for reporting time worked but not recorded, and use it.

☐ Train supervisors not to send or expect messages outside recorded hours for non-exempt employees.

☐ Reconcile system activity against recorded time periodically, and pay corrections promptly — this practice is both the strongest defense and the cheapest remediation.

☐ Confirm compensable time treatment under 29 C.F.R. Part 785, including startup activities that may begin the continuous workday under 29 U.S.C. § 254 and IBP, Inc. v. Alvarez, 546 U.S. 21.

☐ Confirm regular rate treatment of stipends and bonuses under 29 C.F.R. Part 778.

☐ Confirm the minimum wage floor under 29 U.S.C. § 206 and the state rate.

☐ Document the reimbursement methodology and provide a route for employees whose actual costs exceed the stipend.

☐ Record break compliance where the state mandates breaks.

Part 8 — Monitoring, Equipment, and Security

☐ Publish a specific monitoring notice stating what is collected, when, and why — and collect nothing beyond it.

☐ Check state notice and consent requirements before deploying any monitoring tool.

☐ Obtain consent for recorded meetings where any participant is in an all-party consent state.

☐ Limit monitoring to working hours and employer systems.

☐ For personal devices, use containerization rather than broad remote wipe, and obtain written consent.

☐ Require encrypted connections, current systems, screen locks, and multifactor authentication.

☐ Address physical security in the home — documents, screens, and shared spaces — particularly where regulated data is handled; see data privacy and security.

☐ Provide an ergonomic self-assessment and equipment stipend, and document any offered evaluation.

☐ Confirm the incident response plan covers home networks and devices.

☐ Track equipment issued, with a return obligation stated in writing.

Part 9 — Hybrid, Occasional, and International

☐ For hybrid work, determine which state's rules apply on which days, and confirm withholding allocation.

☐ Analyze travel time under 29 U.S.C. § 254: ordinary commuting is not compensable, but travel after the workday has begun frequently is.

☐ Set a cap on days per year in a non-approved location, with approval required beyond it.

☐ Confirm whether short stays trigger withholding in the destination state.

☐ Require prior legal review for any international arrangement, which generally subjects the employer to local employment law and may create permanent establishment exposure.

☐ Run export control and sanctions screening where technology or data will be accessed from abroad; see international trade and sanctions.

☐ Confirm the structure — local entity, employer of record, or a contractor relationship that satisfies the local classification test; see worker classification.

Part 10 — The Employee Who Already Moved

☐ Establish the actual work location and the date it changed.

☐ Register for withholding and unemployment insurance immediately, accepting late-filing penalties as smaller than the accruing exposure.

☐ Add the state to the workers compensation policy and disclose the gap to the carrier.

☐ Qualify the entity where required.

☐ Retest exempt classification against the state threshold and reclassify if necessary.

☐ Reconstruct hours from system metadata and pay any overtime and missed-break premiums owed under 29 U.S.C. § 207 and the state analogue.

☐ Pay reimbursements retroactively where the state requires them.

☐ Credit paid leave accrual from the date work in the state began.

☐ Correct pay statements going forward and assess penalty exposure for prior periods.

☐ Issue required notices.

☐ Document the remediation, which is itself evidence of good faith.

☐ Fix the control that failed — approval gate, manager training, or roster reconciliation.

Part 11 — Annual Audit

☐ Reconcile the location roster against payroll and benefits addresses, and against login geography where lawful and disclosed.

☐ Confirm registrations in every state on the roster.

☐ Confirm workers compensation coverage matches the roster.

☐ Retest every exempt classification against current state thresholds.

☐ Sample pay statements for required content.

☐ Sample expense reimbursements against the state duty.

☐ Confirm paid leave accruals and any state program contributions.

☐ Confirm notices were delivered and acknowledged.

☐ Review the monitoring notice against what is actually collected.

☐ Review the policy against changes in every jurisdiction on the roster.

☐ Record findings, owners, and due dates.

Part 12 — For the Employee

☐ Report your actual work address and get any relocation approved in writing before you move. Working from an unreported state creates tax problems for you as well as for your employer and can jeopardize workers compensation coverage.

☐ Record all time worked if you are non-exempt, including work outside scheduled hours. Compensable time rules at 29 C.F.R. Part 785 do not exempt work you did voluntarily or from home.

☐ If the timekeeping system will not accept the time, report it in writing and keep a copy. Where employer records are inadequate under 29 U.S.C. § 211 and 29 C.F.R. Part 516, a reasonable reconstruction by the employee can carry the day.

☐ Check whether your state requires expense reimbursement for internet, phone, and equipment.

☐ Compare your exempt classification against your own state's salary threshold rather than the federal standard at 29 C.F.R. Part 541; a title does not determine exemption.

☐ Check break entitlements in your state; missed breaks generally carry premium pay.

☐ Check leave eligibility against the worksite from which you receive assignments, per 29 U.S.C. § 2611 — many remote employees qualify when they assume they do not.

☐ Ask what is monitored and get the answer in writing.

☐ Report any home injury immediately, in writing, on the day it happens; the claims framework is in workers compensation claims.

☐ Keep the documents: offer letter, policy acknowledgments, timekeeping and expense records, wage statements, and any written approval of your work location.

Part 13 — Offboarding

☐ Determine the final pay deadline for the employee's state, and whether waiting-time penalties apply.

☐ Determine whether accrued vacation must be paid in that state.

☐ Issue any required separation notices for unemployment insurance and continuation of benefits.

☐ Check whether the separation agreement complies with the employee's state law — permitted confidentiality and non-disparagement terms, consideration, revocation periods, and non-waivable claims; see termination, severance, and final pay.

☐ Confirm restrictive covenant enforceability in the employee's state before attempting to enforce anything.

☐ Arrange equipment return with prepaid shipping and a documented inventory.

☐ Revoke access on the last day — systems, accounts, and any physical credentials.

☐ Delete employer data from personal devices in the manner the policy specifies, documented.

☐ Update the location roster and, where the employee was the only one in a jurisdiction, determine whether registrations should be closed and how.

☐ Preserve records for the applicable retention periods, and preserve everything if a claim is possible.

Part 14 — Ten Mistakes This Checklist Prevents

☐ A manager approving a relocation. Only the named owner approves, and only after the check.

☐ Registering after the first payroll rather than before it.

☐ Assuming headquarters law applies to wage, break, reimbursement, and leave obligations.

☐ Leaving a state off the workers compensation policy, which converts an ordinary claim into an uninsured exposure.

☐ Carrying an exempt classification across a state line without retesting the salary threshold.

☐ Relying on a no-off-the-clock policy instead of a timekeeping system and a reporting channel.

☐ Paying a stipend without documenting the methodology or analyzing its regular-rate treatment under 29 C.F.R. Part 778.

☐ Denying family leave because there are few employees nearby, when eligibility runs to the assigning worksite under 29 C.F.R. Part 825.

☐ Deploying monitoring without a specific written notice, or collecting beyond what the notice describes.

☐ Allowing international remote work without prior review of local employment law, permanent establishment exposure, and export controls.

Part 15 — Scenario Runs

A candidate in a state you do not operate in

☐ Decide before making an offer whether to add the jurisdiction, and price the cost of doing so — registrations, agent fees, annual reports, payroll configuration, and the ongoing wage-hour analysis. ☐ If the answer is no, say so early rather than after an offer; the hiring rules of that candidate's jurisdiction still apply to the process, including any pay range disclosure obligation, as described in hiring and background checks. ☐ If the answer is yes, complete the per-state onboarding sequence before the start date, not after. ☐ Confirm the exempt classification against that state's threshold before the offer states a salary. ☐ Confirm workers compensation coverage is in place before day one.

An employee asks to work from another country for a month

☐ Do not treat this as an extended vacation question. ☐ Determine whether local employment law will attach and on what timeline; some jurisdictions attach obligations within weeks. ☐ Assess permanent establishment exposure for the company. ☐ Run export control and sanctions screening for the technology and data the employee will access; see international trade and sanctions. ☐ Confirm insurance coverage and medical evacuation arrangements. ☐ Confirm immigration status permits the work — a tourist entry generally does not. ☐ Document the approval, its duration, and the conditions, or decline in writing.

A team is moving from fully remote to hybrid

☐ Determine which state's rules apply on which days for wage and hour purposes. ☐ Confirm withholding allocation and any day-threshold rules in each state. ☐ Reassess unemployment insurance assignment under the localization test. ☐ Analyze travel time under 29 U.S.C. § 254 and the continuous workday principle of IBP, Inc. v. Alvarez, 546 U.S. 21. ☐ Update the worksite designation, which drives leave eligibility and layoff notice counting. ☐ Update the expense reimbursement schedule, since commuting is generally not reimbursable while inter-office travel may be. ☐ Republish the policy and collect fresh acknowledgments.

A wage claim arrives

☐ Preserve everything immediately, including system metadata, message logs, and timekeeping records. ☐ Pull the location roster and confirm which state's law governs each period. ☐ Reconstruct hours from system activity and compare against recorded time. ☐ Identify whether records satisfy 29 U.S.C. § 211 and 29 C.F.R. Part 516, because inadequate records shift the practical burden. ☐ Determine whether the claim is individual or class-wide in character — a systemic timekeeping design flaw affects everyone in the classification. ☐ Consider prompt correction and payment for any period where the analysis favors the employee; it is usually cheaper than litigating and it establishes good faith.

Part 16 — The One-Page Version

For an operations owner who will read only one section, this is it.

☐ Keep a roster showing where every employee physically works, the designated worksite, and their classification.

☐ Require written approval before anyone changes work location, and train managers to say "I can't approve that — here's who can."

☐ Complete the per-state sequence once per jurisdiction: withholding registration, unemployment insurance, workers compensation, entity qualification, wage-hour analysis, leave setup, and notices.

☐ Give non-exempt employees a way to record every hour they work, and a way to report hours they could not record, with no consequence for using it.

☐ Write down what you reimburse and why, and check whether the state requires more.

☐ Retest exempt classifications whenever someone moves.

☐ Say exactly what you monitor, and monitor nothing else.

☐ Reconcile the roster annually against payroll, benefits, and coverage.

☐ Decide deliberately which states you support, because the cost scales with jurisdictions rather than headcount.

⭐ The single sentence. Know where everyone works, in writing, and attach a checklist to every change — the rest of this document is detail.

Part 17 — Documents to Retain

☐ The remote work policy and every employee acknowledgment, with version history. ☐ The location roster, with dated entries for every change and the compliance check that accompanied it. ☐ Location change requests and written approvals. ☐ Worksite designations for each employee. ☐ Per-state onboarding checklists, completed and dated, with registration confirmations. ☐ Workers compensation policy endorsements showing each covered state. ☐ Timekeeping records satisfying 29 U.S.C. § 211 and 29 C.F.R. Part 516, including reports of unrecorded time and the corrections paid. ☐ Expense reimbursement submissions, approvals, denials, and the methodology memorandum for any stipend. ☐ Exempt classification analyses, by employee and by state, with the threshold applied and the date. ☐ Pay statements as issued, by state. ☐ Leave accrual records and any state program contribution records. ☐ Wage-rate notices and proof of electronic posting delivery. ☐ Monitoring notices as delivered, and the configuration showing what was actually collected. ☐ Equipment issuance and return records. ☐ Home workstation self-assessments and any ergonomic evaluations offered. ☐ Incident and injury reports. ☐ Annual audit reports with findings, owners, and completion dates.

☐ Retention rule. Keep everything for at least the longest applicable statutory period in any jurisdiction on the roster, preserve all records relating to any employee or period where a claim is possible, and never destroy records after learning of a charge, demand, or audit.

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