Remote Work and the Law: Two Rulings Employers Cannot Ignore

The shift to remote work has created significant legal gray areas. Old laws, written for physical offices, are now being tested in court, and the results have critical implications for your business.

Two recent court decisions highlight the risks of ambiguity around a remote employee’s “worksite.” Understanding these cases is essential for protecting your company from costly litigation.

1. The FMLA Problem: Where Does Your Remote Employee Actually Work?

The Family and Medical Leave Act (FMLA) gives certain employees job-protected leave. To be eligible, an employee must meet several criteria, including the “50/75 rule”: they must work at a location where the company has at least 50 employees within a 75-mile radius.

This rule is simple for a traditional office but confusing for remote staff.

A recent case demonstrates the danger. A remote technician who lived and worked in Texas sued her Ohio-based employer for denying FMLA leave.
* The Employee Argued: Her official worksite was the company’s Ohio headquarters, which had more than 50 employees, making her eligible.
* The Employer Argued: Her worksite was her home in Texas, where the company had no other employees, making her ineligible.

The court could not determine the official worksite and left the decision to a jury. This uncertainty is a major risk for employers. You do not want a jury deciding your company’s policy.

Actionable Advice: How to Define the Worksite

You have three clear options to reduce this risk:

• Eliminate the Rule: For simplicity, many employers now disregard the 50/75 rule altogether and extend FMLA eligibility to all employees who meet the other requirements. This is the most straightforward approach.
• Assign an Office: Formally assign each remote employee to a specific company office (like a regional hub or corporate headquarters) as their official worksite for administrative and reporting purposes.
• Define Reporting Structure: Make it perfectly clear in your job descriptions and policies which office an employee reports to and where they receive their assignments from. Ambiguity creates liability.

2. The State Law Problem: Does “Working In” a State Mean Being Physically Present?

Another critical question is which state’s employment laws apply to your remote workers. A case involving the Minnesota Human Rights Act (MHRA) provides a crucial lesson.

An employee worked for a Minnesota-based company for two years but worked remotely from other states and never lived in Minnesota. After her employment was terminated, she sued under Minnesota’s employment law.

The court sided with the employer. Its decision was clear: to be protected by that state’s law, an employee must be physically present in the state. Working “virtually” from another state was not enough to qualify for protection under the MHRA.

While this case was specific to Minnesota, the principle has national implications. You must know which state’s laws—and which city’s ordinances—govern each of your employees. Assuming the law of your headquarters’ state covers everyone is a mistake.

Actionable Advice: How to Manage Multistate Compliance

To protect your business, you must:

• Establish Clear Policies: Create unambiguous remote and hybrid work policies that are acknowledged in writing by your employees.
• Maintain Accurate Records: Keep up-to-date records of where each employee physically lives and performs their work. This is not just contact information; it is a compliance requirement.
• Develop a Multistate Strategy: If you have employees in multiple states, you must have a compliance strategy that accounts for the different labor laws in each location.

The convenience of remote work comes with legal complexity. Proactively defining your policies and understanding your obligations is no longer optional—it’s essential for managing your risk.