What Should a Remote Work Policy Include for a Small Business?

A small-business remote work policy should explain who can work remotely, where and when they work, what equipment you provide, how expenses are handled, and how company information stays secure. Start with clear operating rules, then check pay, reimbursement, accommodation, and employment standards requirements for each employee’s work location. Keep individual schedules and equipment assignments in a separate written agreement.

Start with the job and the work location

Before drafting, list each role, its essential duties, and where those duties can be performed. A bookkeeper might work entirely from home; a shop supervisor might handle ordering remotely but need to open the store in person.

Use consistent eligibility criteria:

Can the employee complete the duties away from your premises?
Can customers and coworkers get the support they need?
Can sensitive records be accessed securely?
Does the arrangement preserve necessary on-site coverage?
How will you measure completed work?

Avoid making remote work a reward for employees a manager likes. Explain decisions using duties and coverage needs, not vague labels such as “trustworthy.”

Record the approved work address, too. Ask employees to get approval before routinely working from another state, province, territory, or country. Review location changes separately rather than assuming the original arrangement still fits.

Use this remote work policy template for a small business

The following wording is a starting point, not a ready-to-sign policy. Choose your actual approval process, communication tools, and expense arrangements before issuing it.

Eligibility and approval

Remote work is available for roles whose duties, service needs, and information-security requirements can be met off-site. The owner or designated manager reviews requests using consistent, job-related criteria. Each approved arrangement will document the work location, schedule, supervisor, and review date. Requests connected to a disability or another legally protected accommodation need will be reviewed separately from ordinary remote work requests.

For U.S. employers covered by federal disability law, telework can be a reasonable accommodation in some circumstances, according to the U.S. Equal Employment Opportunity Commission (EEOC). Don’t assume that denying ordinary remote work eligibility settles an accommodation request.

Schedule, availability, and communication

Employees and managers will agree on working hours, the applicable time zone, required meetings, and coverage responsibilities. Employees should keep their calendar and availability status current and use the agreed urgent-contact channel during scheduled work. Remote work does not create an expectation of constant availability outside that schedule.

Set response expectations by task. “Acknowledge customer escalations during your assigned coverage period” is more useful than “always respond quickly.”

Name a backup contact for urgent matters so employees can take their breaks without remaining the unofficial emergency contact.

Timekeeping and extra hours

Employees required to track time must record all time worked, including work calls and messages outside their regular schedule. Get manager approval before working additional hours, but report all hours actually worked even if approval was not obtained. Take required breaks and promptly report missed breaks or time-record errors.

According to the U.S. Department of Labor, employers must pay covered, nonexempt employees for compensable work performed at home, including work the employer knows or has reason to believe occurred. Handle unauthorized extra work as a management issue, not by deleting the time.

Equipment and workspace

The individual remote work agreement will identify company-provided equipment and any approved personal devices. Employees should maintain a suitable workspace, protect equipment from unauthorized use, and report damage, loss, discomfort, or work-related incidents promptly. The company will explain technical support, repair, replacement, and equipment-return procedures.

Keep a simple equipment log with the device, serial number, issue date, and condition. Decide who pays shipping for repairs and returns before a laptop fails, consistent with applicable law.

Expenses and reimbursement

The company will explain which remote work expenses it covers, any approval process, and how employees submit claims. Covered categories may include equipment, necessary software, business phone use, and internet costs. This policy does not limit reimbursement or payment required by applicable law.

Don’t rely on “all home-office costs are the employee’s responsibility.” According to the U.S. Department of Labor, expenses primarily for the employer’s benefit cannot reduce covered employees’ earnings below required federal minimum wage or overtime compensation. State law may impose additional reimbursement obligations.

Data security and privacy

Use approved devices, accounts, storage, and communication tools for company work. Enable multifactor authentication where available, install required updates, and lock screens when away. Do not share company devices with household members or move business files into personal email or storage accounts. Report suspected phishing, lost devices, and accidental disclosures immediately to the designated manager.

Also decide whether employees may print records at home, use public Wi-Fi, or work in shared spaces. Explain any monitoring tools before deployment, and get local advice on privacy and notice requirements—especially if monitoring could capture private home activity.

Changes and ending the arrangement

The manager and employee will regularly review service coverage, work quality, communication, and equipment needs. Any change to the arrangement will be discussed and documented, including the revised schedule and equipment-return plan. Changes will comply with applicable legal and contractual obligations. Accommodation-related arrangements will receive a separate review before changes are made.

Avoid promising permanent remote work unless that is genuinely your intention.

Check U.S. and Canadian requirements before rollout

Rules vary by state, province, and territory. Review requirements based on where each employee actually works, not just your business address.

For U.S. employees:

Pay and hours: According to the U.S. Department of Labor, federal wage-and-hour protections apply to covered remote work. Check its guidance on hours worked and overtime.
State differences: The U.S. Department of Labor identifies state labor departments as sources for state labor-law questions. Ask the relevant department about reimbursement, breaks, overtime, and wage deductions before finalizing those clauses.
Accommodation: According to the U.S. EEOC, covered employers may need to modify workplace policies as a reasonable accommodation. Keep that review distinct from your standard eligibility process.

For Canadian employees:

Jurisdiction first: According to Employment and Social Development Canada, federal labour standards apply to federally regulated workplaces; other workplaces generally fall under provincial or territorial employment standards. Don’t copy federal rules into every Canadian policy.
Hours and expenses: Employment and Social Development Canada provides federal guidance on hours of work, overtime, and work-related expense reimbursement. For a provincially or territorially regulated business, confirm those subjects with the relevant employment standards office instead.

Ask a qualified local adviser to review cross-border arrangements and privacy questions outside employment standards guidance.

What this looks like in practice

Example: a small bakery. The owner approves a remote morning each week for the employee who handles invoices. The agreement reserves that time for bookkeeping, names another employee to answer supplier calls, and provides a company laptop. Counter staff remain on-site because their duties require it—not because the owner values their work differently.

Example: a small roofing company. Estimators prepare quotes from home but visit job sites. Their agreements distinguish quote-writing hours from site visits, require all work time to be recorded, and prohibit storing customer documents in personal accounts. When an estimator proposes moving to another province, the owner reviews the location’s requirements before approving the change.

Roll it out with a short checklist

Before employees acknowledge the policy:

Test whether schedules provide actual customer coverage.
Give each person an equipment and expense summary.
Show employees how to report time, security incidents, and technical problems.
Name a contact to resolve questions.
Schedule a review after the arrangement has had time to work.

If you use a handbook-generation tool, treat its output as a first draft. Tailor the remote work rules to your business and obtain local review.

FAQ

Can a small business allow remote work for only some roles?

Yes—build eligibility around duties, coverage, and security rather than personal preference. According to the U.S. EEOC, covered employers should separately consider whether telework is needed as a reasonable accommodation.

Should we pay for home internet?

Decide what support you’ll offer, but check applicable requirements before setting exclusions. Consult the relevant state labor department or provincial or territorial employment standards office; Employment and Social Development Canada provides expense guidance for federally regulated Canadian workplaces.

Do we need a separate agreement for each remote employee?

A short individual agreement is useful even when everyone follows one policy. Use it to record the approved location, hours, equipment, expenses, and review date without rewriting the handbook. Check whether local law requires particular written terms.

Sources

This article is general information, not legal advice.