USA – NORTH CAROLINA Law and Practice Contributed by: Phillip Strach, Alyssa Riggins, Nathaniel Pencook and Cassie Holt, Nelson Mullins Riley & Scarborough LLP
Privacy and Data Security Mobile work brings increased dangers of privacy and data breaches. Employees often have access to sensi - tive or proprietary business information, trade secrets and other sensitive materials, personnel information and confidential customer data. Employees should establish protocols for access, storage, transmission and use of this data. Best prac - tices include data encryption, strict access controls (eg, multi-factor authentication), data minimisation (eg, regular review and deletion of unnecessary data), employee training, remote work policies and use of company-issued devices. Further, given the increase in data breach incidents during the past few years, employers would be wise to establish a clear data breach response plan. Employers must also consider the privacy of the mobile employee. Although monitoring a mobile employee’s activities is often an appropriate and even necessary measure to ensure and assess performance, such measures should avoid invading a remote employee’s privacy. By way of example, the Electronic Communi - cations Privacy Act (ECPA) prohibits the interception and monitoring of electronic communications without consent. If employers intend to monitor such commu - nications, they must ensure that they have provided notice and obtained consent. Any monitoring or sur - veillance should also not infringe on employees’ rights to engage in protected activities under the National Labor Relations Act (NLRA). Tax Obligations and Social Security Employers must carefully plan and manage tax obliga - tions and compliance for mobile employees. This is because companies with mobile employees located in difference states or countries may trigger withholding requirements for the employer. By way of example, a remote worker’s presence in a state can create a “nex - us” with that state, which may subject the employer to state income tax, sales tax and other business tax obligations. In other words, in determining tax obli - gations, employers must give careful attention to the location of the mobile employee – not just the loca - tion of the employer. Navigating the tax implications of remote work can be complex, and employers are
advised to consult tax professionals to ensure compli - ance and optimise outcomes. Employers must navigate similar issues in the land - scape of social security. Although the rules differ from those applicable to income tax, employers with cross-border remote workers could be responsible for social security taxes/contributions in the home country, the host country or both. Compliance with these regulations requires careful planning and often the assistance of legal and tax professionals to ensure that both employers and employees meet their social security obligations. 5.2 Sabbaticals Employers may, but are not required to, provide sab - batical leave. Sabbatical leave can take many forms and can arise for a variety of reasons. Although not uniformly defined, a sabbatical is typically an extend - ed leave of absence from work done in order to pur - sue personal or professional interests. Employers may grant an employee sabbatical leave for reasons such as personal travel and studies, or so the employee can pursue an additional degree or specialised education. Depending on the employee’s purpose in requesting the leave, a sabbatical may range in length from a couple of weeks to several months or up to a year. Most employers address sabbatical leave in their handbooks or policy guidelines. By way of example, an employer may set standard procedures for requesting the leave, such as a required advance notice period or a written submission justifying the nature or purpose of the leave. Similarly, an employer may choose to specify purposes for sabbatical leave, such as allow - ing it for educational or professional study purposes but not for personal travel. A good example of how the federal government addresses sabbatical leave can be found in Section 3396 of Title 5 of the US Code, which specifies certain employees who may receive sabbatical leave for certain specified purposes. Another relevant consideration for employers look - ing to establish a standard sabbatical leave policy is how the employee taking the leave will be paid. Many employers offer incentives for certain purposes, such as reimbursement of educational expenses or travel. Employers should still take care to ensure compliance
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