Remote work burst onto the employment landscape in a big way in the earliest days of the COVID-19 pandemic, but what many thought was likely to be a temporary arrangement turned out to be one many New Jersey employees—not to mention a surprising number of employers—really liked. But while it’s easier than ever before for employers, when hiring out of state employees in New Jersey.
Now, with employment being less location-dependent, employees are able to search for jobs in states other than where they live (or move while keeping their job), and employers can cast a wider net when searching for candidates. it is however, critical that you do so in an informed and organized way. Employment standards vary from one state to the next, and employers are responsible for making sure their policies are in line with the requirements for each new state in which they hire.
Luckily, with SixFifty’s multistate employer compliance toolkit, this process doesn’t have to present an insurmountable hurdle to your business. Let’s take a look at how we can help you bring on out-of-state employees in New Jersey.
Scenario 1: Employee works from home in another state
It’s increasingly common to have employees who wish to move to a new state because they can work remotely. If your California-based business doesn’t have a physical presence on the east coast and one of your employees is planning a move to New Jersey, you’ll need to get up to speed on New Jersey’s state-level employment standards and policies to ensure you’ll be in compliance with the law. This is a complex process, and not one you’ll want to risk accidentally messing up.
Scenario 2: Hiring out-of-state employees in New Jersey
If your company is looking to hire an out-of-state employee who lives in New Jersey, and it’s your first time doing so, you’ll need to establish an economic nexus in the state and register as an employer before you actually proceed with the hire. This is because errors during this process can cause delays, and failure to complete all the necessary steps can lead to mistakes that can cost your company a lot of time and money. Take the time to ensure your business is compliant with New Jersey’s unique requirements.
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 New Jersey—or accommodating employees moving to New Jersey if there’s no established business nexus.
1. New Jersey Employment Registration
When hiring an out-of-state employee who lives in New Jersey, the process begins with obtaining a registered agent and a certificate of authority. At this point, you’re ready to start doing business in the state. Report new hires to the New Jersey Department of Human Services, and ensure your unemployment and workers’ compensation insurance policies are in line with the state’s requirements.
- Obtain a registered agent
- Obtain a certificate of authority in New Jersey
- Report new hire to the New Jersey Department of Human Services
- Register for unemployment insurance
- Report unemployment insurance account to payroll provider
- Obtain workers’ compensation coverage or update the policy
2. New Jersey Tax Registration
In New Jersey, your business will need to account for both sales tax and income tax when hiring an out-of-state employee. It’s critical that you make sure your company is withholding and reporting taxes in a manner that complies with state law. Reach out to the New Jersey Division of Revenue and Enterprise Services to get started.
- 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. New Jersey Employment Policies
New Jersey has some very specific requirements on the books when it comes to employment policies, and your company needs to follow these to the letter in order to remain compliant with New Jersey law. When hiring an out-of-state employee in New Jersey, you’ll need to take the time to update or add to your employee handbook to reflect the policies that apply to your new employee at the state level.
- Review employee handbook for compliance
- Update policies or add new leave policies as needed
4. New Jersey Employment Implications
Do you know the specific employment implications that apply to workers in New Jersey? Minimum wage, insurance coverage, non-compete provisions and other standards may differ significantly from what you’re used to, and to ensure your company is fully compliant, you’ll want to familiarize yourself with the policies that will apply to your new out-of-state employee in New Jersey.
- Ensure non-compete provisions comply with New Jersey law
- Confirm the employee is paid at least the minimum wage
- Review the applicable overtime laws
- Confirm the payroll practices meet the payment frequency standards in New Jersey
- Consider whether insurance extends coverage to employees in New Jersey
- Consider COVID-19 laws that affect the employee
5. New Jersey Signage
New Jersey has upwards of a dozen workplace signage requirements, some of which need to be available in multiple languages. This signage applies to such concerns as child labor, family leave insurance, work hours for minors and more. Refer to the U.S. Department of Labor’s standards regarding electronic posting to ensure your out-of-state employees in New Jersey have appropriate access.
- 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 New Jersey employment laws and standards. It’s why SixFifty has compiled an extremely useful tool for businesses hiring out-of-state employees in New Jersey. To simplify the process of hiring out-of-state employees in New Jersey or supporting remote employees on-the-move, check out our 50 State Hiring Kit.
Written by Meili Bell
Meili Bell is the Content Manager at SixFifty. She spends her workdays writing, editing, project managing and reading about the intersection of law and technology. Meili comes to SixFifty from Gifted Music School, a nonprofit music school for the most dedicated young musicians in the region, where she was program director of the school’s flagship program for the last ten...
Full Bio and other articles by Meili Bell