It’s clear that remote work is here to stay, and there are numerous benefits to enjoy for both businesses and employees alike. However, before a company can fully embrace a remote staff, it needs to ensure it’s in total compliance with state-level employment standards. Multistate employer registration when hiring out of state employees in Arkansas needs to be top-of-mind, for the sake of businesses and employees taking advantage of remote work.
When it comes to hiring out-of-state employees in Arkansas, for example, there’s a host of considerations businesses need to be mindful of. Does your company have a business nexus in Arkansas? What state-level payroll tax considerations do you need to account for? Are there any state-specific employment policies that need to be instituted? It’s important to ask these questions and address them before they become a problem.
SixFifty understands the challenges of multistate compliance, which is why we’ve put together a robust out-of-state hiring tool for companies seeking to capitalize on remote work. Here’s a look at how our tool helps to simplify the process.
Scenario 1: Employee works from home in another state
Remote work has opened borders for employees, and many have begun to move throughout the country. If you have current employees that move to Arkansas, you’ll need to make sure your organization becomes a registered employer with the state. Even if they work from home full time, Arkansas state-level employment standards apply, which can mean new employment, tax, policy and reporting criteria for your business. It’s important to get ahead of these expectations, to better support employees as they settle down in Arkansas.
Scenario 2: Hiring out-of-state employees in Arkansas
Thinking about hiring talent from the Land of Opportunity? Hiring out-of-state employees in Arkansas means you’ll need to establish a business nexus and make sure your business is registered with the state as a licensed employer. Not only that, you’ll need to make sure your policies, provisions, standards, and employment practices align with Arkansas’ employment requirements. It can be a daunting set of hoops to jump through—especially if your company is based out of a state with different employment standards.
Multistate Employer Registration Factors to Consider
In both of the above scenarios, employers need to pursue multistate compliance or risk being held accountable by the Department of Labor for failing to comply with state-specific employment standards. Compliance differs across all 50 states. To simplify the process, SixFifty has narrowed down multistate employer registration considerations to five core areas of focus.
Here’s what it looks like for companies hiring out-of-state-employees in Arkansas—or accommodating employees moving to Arkansas if there’s no established business nexus.
1. Arkansas Employment Registration
The process of hiring out-of-state employees in Arkansas begins with registering your business within the state. From there, you’ll need to report all new hires to the state’s New Hire Reporting Center. Once you’ve got your employees registered, make sure to register for unemployment insurance, as well as a workers’ compensation policy that accommodates your employees in Arkansas.
- Obtain a registered agent
- Register to do business in Arkansas
- Report new hire to the Arkansas New Hire Reporting Center
- Register for unemployment insurance
- Report unemployment insurance account to payroll provider
- Obtain workers’ compensation coverage or update the policy
2. Arkansas Tax Registration
Tax considerations are critical for staying compliant with Arkansas’ employment laws. That means registering for income tax withholding and collecting the appropriate tax documents from employees. There are also sales tax licensing and permitting considerations to take into account. These considerations will vary depending on the business and its economic activity in the state.
- Register for income tax withholding account
- Obtain the completed state income tax withholding form from the employee
- Register for a sales tax license or permit
3. Arkansas Employment Policies
Arkansas has specific requirements regarding the terms and conditions of situations like time off for jury duty, public service leaves of absence, voting leave and much more. Businesses need to familiarize themselves with these policies and make sure they’re updated accordingly in the employee handbook.
- Review employee handbook for compliance
- Update policies or add new leave policies as needed
4. Arkansas Required Employment Policies (May 2023)
- Crime Victim Leave
- Jury Duty Leave
- Organ and Bone Marrow Donor Leave
- Public Service Leave
- Voting Leave
5. Arkansas Employment Implications
From minimum wage considerations to the process of terminating an employee, there are a slew of critical employment implications businesses need to understand and follow at the state level. There are especially important considerations regarding when and how to pay employees. Organizations hiring out-of-state employees in Arkansas need to codify these standards into their business’ operations to remain compliant.
- Ensure that non-compete provisions comply with Arkansas law
- Confirm that the employee is paid at least the minimum wage
- Review the applicable overtime laws
- Confirm that the payroll practices meet the payment frequency standards in Arkansas
- Consider whether insurance extends coverage to employees in Arkansas
- Consider COVID-19 laws that affect the employee
6. Arkansas Signage
With more than a half-dozen mandated types of signage required in Arkansas’ workplaces, it’s up to employers to stay compliant with the state’s information dissemination guidelines. From digital signage for remote workers to physically posted signage for workplaces, companies need to make important information accessible to employees in Arkansas.
- Post or distribute required signage
Simplify Multistate Compliance with SixFifty
The process of maintaining compliance can be complex and extremely nuanced for companies unfamiliar with Arkansas employment laws and standards. It’s why SixFifty has compiled an extremely useful tool for businesses hiring out-of-state employees in Arkansas. To simplify the process of hiring out-of-state employees in Arkansas or supporting remote employees on-the-move, download our 50 State Hiring Kit.