When employees are hired to work remotely from outside of California, Stanford must follow the employment laws of the state or country where the work is performed, and those laws can differ. Requirements may include additional compliance requirements besides those relating to employment.
Hiring or reassigning employees to work outside California must be justified by a valid university business purpose. See Administrative Guide Policy 2.2.2: Out-of-State Employees for details.
To defray non-standard administrative costs, departments are charged a one-time $500 set-up fee and a $200 annual fee for each out-of-state employee. The PTA for the fees is captured via the Work Agreement process.
Through the Work Agreement process, Payroll is notified of each out-of-state employment relationship. A key input to this process is the local HR contact setting the employee’s “Work From Home” status to Yes. Additionally, the employee must maintain their contact information to include a home address reflective of their remote work location.
California requires tax reporting and withholding for work performed in California. Employees enter a temporary tax location on the time card for days that they work on-site in California.
For periods prior to June 30, 2026, department administrators should report the number of days to Payroll on the Out-of-State Employee Days Worked in California Form.This process will sunset at the end of tax year 2026.
If an employee moves back to California, their department must update the employee’s Work Agreement prior to the relocation date.
As with out-of-state employment arrangements, Stanford is required to comply with all employment laws in any foreign country where an employee is retained. For more information, refer to Stanford Personnel Working Abroad on the Global Business Services website.