Remote and hybrid work are here to stay, and with them come new challenges for employers managing teams across state lines. While flexibility broadens access to talent, it also introduces a patchwork of compliance obligations that can expose employers to risk if not addressed proactively.
State Laws Govern Where Employees Work
A key rule for employers to remember is this: the law of the state where the employee works—not where the company is based—controls. That means a Maryland resident working from home for a Virginia business is subject to Maryland’s wage and employment protections. Tracking employee locations has become a crucial compliance step.
Employee Handbooks: One Size Doesn’t Fit All
Uniform handbooks are often not sufficient for multi-state workforces. A policy written with Virginia law in mind could conflict with paid leave or wage laws in Maryland or California. A practical solution is to maintain a standard core handbook and add state-specific supplements tailored to each jurisdiction where employees work. The Maryland Department of Labor provides a Guide to Wage Payment and Employment Standards, which illustrates just how detailed these rules can be.
Restrictive Covenants Under Pressure
Restrictive covenants like non-compete agreements are facing increased scrutiny.
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National Trend: The Federal Trade Commission has proposed a rule banning most non-competes nationwide, though court challenges continue.
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State Spotlight – Maryland: Beginning July 1, 2025, non-competes for direct patient care healthcare providers earning less than $350,000 annually will be unenforceable. This rule was enacted through HB 1388 and is codified in Maryland Code, Labor & Employment § 3-716.
Employers should review their restrictive covenants, identify which employees are bound by them, and evaluate whether state laws render those provisions invalid. Alternatives such as non-disclosure or non-solicitation agreements may offer more reliable protection.
Proactive Steps for Employers
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Audit locations to confirm where employees perform work.
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Review policies for compliance with multiple states.
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Reevaluate non-competes in light of state and federal trends.
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Work with counsel for updates as laws evolve.
Conclusion
Multi-state compliance is no longer a problem only for large corporations. Even small and mid-sized businesses are now navigating this landscape. By taking proactive steps—tracking employee locations, adjusting handbooks, and revisiting restrictive covenants—employers can reduce risk and stay ahead of legal change.
Contact us today to discuss how Luchansky Law can help employers build policies and agreements that stand up across jurisdictions. (410) 522-1020 | info@luchanskylaw.com | www.luchanskylaw.com.
Preparation remains the best strategy in a shifting legal environment.
About Luchansky Law
Luchansky Law is a premier labor and employment law firm committed to providing exceptional legal representation and client service. Founded in 2004 by Bruce Luchansky, the firm offers a wide range of legal services to businesses and individuals, focusing on workplace issues, employment disputes, and compliance. Luchansky Law is dedicated to upholding the highest standards of diligence, professionalism, and compassion in its practice.
