Over the last few years, there have been dramatic shifts in how and where people work. Among the most prevalent issues today are the rise of hybrid/remote work, the implications arising with multi-state employers, and the increasing scrutiny of non-compete agreements.
While hybrid and remote opportunities offer significant flexibility and broader access to talent across the nation, this also introduces a web of legal risks for employers managing a dispersed workforce. The legal employment landscape is no longer a one-size-fits-all, as remote and hybrid policies expand to become long-term strategies rather than short term fixes. Employers with employees in multiple states as a result of multiple worksite locations or employees working remote from home, must proactively ensure compliance with all employment laws in the states in which they have employees working. Rather than being able to simply focus compliance on employment laws of one particular state, employers with employees across multiple states are required to comply with a variety of different employment laws resulting in an ongoing compliance process.
Employers who have employees across multiple states may struggle with producing and maintaining a uniform employee handbook for their business, as they may unintentionally violate state-specific employment laws. To get ahead, employers across multiple jurisdictions should continuously track employee work locations and draft applicable state-specific supplements to their standard employee handbook with the assistance of legal counsel.
Employers must be aware that the laws where the employee works, not resides, dictate employer compliance with state employment laws. This is key to understanding various trending topics such as non-compete agreements.
In 2024, the Federal Trade Commission (“FTC”) proposed a rule banning most non-competes nationwide. Challenges continue to move through the courts, but the trend indicates that non-compete agreements are on the decline. Specifically in Maryland, effective July 1, 2025, non-compete agreements for direct patient care healthcare providers earning less than $350,000 annually are banned. For example, a primary care business located in Virginia that hires a doctor who provides telehealth in Maryland would have to comply with the Maryland ban on non-competes for the doctor if she earns less than $350,000 annually.
So, how should employers prepare to handle these kinds of situations, and minimize the risk to their business? Begin by identifying which employees are currently bound by a non-compete agreement. Legal counsel can assist you with protecting your business in areas including:
- Identifying any concerning provisions in your non-compete agreement.
- Evaluating the validity of your non-compete in various states.
- Providing strategic guidance for additional options to consider, including non-disclosure agreements and non-solicitation agreements.
The field of employment law is evolving rapidly, and employers who proactively audit their policies (including accurately recording employee locations and identifying who is bound by specific agreements) will be better positioned to adapt. Compliance is no longer a simple checkbox; it’s an ongoing process. Anticipating change remains the most effective way to stay prepared. Our attorneys can assist multi-state employers in navigating this shifting legal environment as the workforce continues to expand and evolve nationwide.
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For more information about how labor and employment laws may impact you or your business, please contact the Davis, Agnor, Rapaport & Skalny attorney with whom you typically work, or one in our Labor & Employment Practice Group.