What to update before the move date, what most companies miss, and how to keep one relocating employee compliant without registering in a new state.
When an employee permanently moves to another state, that state usually becomes where they work, and its rules apply from the move date. The employer typically switches state income tax withholding, reports unemployment insurance to the new state, makes sure workers' compensation covers it, and follows its wage, leave, and notice rules. If your company is not set up in the new state, you either register there or move the employee onto an Employer of Record that already is, with the same role, manager, and pay.
The answers decide what changes and when.
The move date is when payroll usually switches. Wages earned before it belong to the old state, wages after it to the new one.
A permanent move changes where the employee works. A few weeks away may not, but rules differ by state, so check before assuming a short stay never counts.
Regular days in an old-state office can keep part of the wages taxable there. Some states, such as New York, can tax remote work done for an in-state office in certain cases.
Check whether you have a withholding account, an unemployment insurance account, and workers' compensation coverage that extends to the new state.
Some cities, counties, and school districts levy their own income tax. Ohio, Pennsylvania, Indiana, and Maryland are common examples.
These change on the move date. Details differ by state, so treat this as a checklist, not tax advice.
From the move date, withhold for the new state instead of the old one, using the new state's withholding form. The employee's W-2 for that year usually shows wages in both states. If the new state has no income tax on wages, such as Texas or Florida, old-state withholding still has to stop.
Under New York's "convenience of the employer" rule, days a nonresident works from home can count as New York workdays when their primary office is in New York. Check this before you stop old-state withholding completely.
Unemployment insurance wages are generally reported to the state where the work is performed. Once the employee works from the new state, the employer registers there and pays that state's unemployment tax.
A new address can add or remove city, county, or school-district taxes with their own withholding and filings, for example municipal taxes in Ohio or local earned income taxes in Pennsylvania.
More than a dozen states and DC run paid family and medical leave programs, funded through payroll contributions. Moving into or out of one of these states adds or removes a deduction and a filing.
States set their own rules for how often employees must be paid and what a pay statement must show. Your current schedule may not meet the new state's rules.
The employee's job stays the same. The rules around it follow them to the new state.
Your policy has to cover the new state. In Ohio and Washington, coverage comes from a state fund instead of a private insurer. In Texas, coverage is optional, but employers who opt out must file notices.
The new state's minimum wage, overtime rules, and salary thresholds for exempt employees apply from the move date. Some cities set higher minimums.
Many states require paid sick leave, with their own accrual rates, caps, and carryover rules. An employee can gain or lose an entitlement just by moving.
A non-compete that was enforceable in the old state may not be in the new one. California, Minnesota, and Wyoming broadly ban non-competes for most employees.
When employment eventually ends, the new state's rules decide how fast the final paycheck is due and whether unused vacation has to be paid out.
The new state has its own required notices, often including written pay notices. Remote employees still need to receive them, usually electronically.
We have a guide for every state. Start from the Employer of Record overview to find yours.
WorkGenius is already registered and insured in all 50 states. Move your relocating employee onto WorkGenius as their Employer of Record, with the same role, manager, and pay, and we handle the new state from day one.
If you are not already set up in the new state, there are two ways to keep the employee compliant.
Open withholding and unemployment accounts in the new state, extend your workers' comp coverage, add any local taxes, and update your payroll from the move date.
Makes sense when
WorkGenius becomes the Employer of Record for this one employee in the new state, with the same role, manager, and pay. You keep directing the work.
Makes sense when
Moving an employee onto an EOR changes the employer on paper: their employment with your company ends under the old state's final-pay rules, and WorkGenius starts a new employment in the new state. Day to day, nothing changes for them.
As the Employer of Record, WorkGenius takes on the employment obligations in the new state.
Check with your advisor: using an EOR means your company is not the employer in the new state, but it does not automatically settle whether your business itself needs to register or file business taxes there.
Pricing is one all-in markup on the employee's pay, billed on one weekly invoice. Benefits are billed separately.
Tell us where your employee is movingThis guide is general information, not legal or tax advice. Rules change and vary by state.
We'll walk you through what the new state requires and how WorkGenius can employ them there, with the same role, manager, and pay.
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