During the COVID-19 pandemic, many New York employers shifted to a remote workforce model, which resulted in employees performing their jobs from other states. Employers are now considering whether to afford the option of continued telecommuting as part of their reopening plans. In assessing the feasibility of permitting employees to work from out-of-state locations, employers customarily assess business and tax issues. However, there are myriad employment law issues to consider as well, including with respect to terms and conditions of employment, anti-discrimination and leave laws, and employee separations.

Terms and Conditions of Employment

Employers may engage employees at-will in New York state, with the limited exception of fast-food workers in New York City. See N.Y.C. Admin. Code §20-1201. This means that absent a constitutionally impermissible purpose, statutory proscription, or express limitation in the individual contract of employment, an employer has an unimpaired right at any time to terminate the employment relationship without penalty or obligation. See Smalley v. Dreyfus, 10 N.Y.3d 55, 58 (2008). The at-will doctrine is firmly entrenched in almost all other states. Therefore, a New York employer is unlikely to encounter any issues in this regard if an employee works elsewhere. The exception is Montana, where an employee can be discharged only for good cause subject to certain exceptions. See Mont. Code Ann. §39-2-904.

Other matters are not as straightforward. For example, there may be issues with respect to the enforceability of certain provisions in employment agreements. New York employers usually prefer that New York law apply, and include a choice-of-law provision to this effect. It is generally true that such a provision will be honored where the chosen state bears a reasonable relationship to the parties or transaction, such as when the employer is located within the state. See Askari v. McDermott, Will & Emery, 179 A.D.3d 127, 147-48, 153-54 (2d Dep't 2019).