Hiring Practices You Should Avoid When Searching for Remote Jobs

A woman works on her laptop while holding a cup of tea at her desk in her home. This story goes over hiring practices you should avoid when hunting for a remote position online.
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You see a job ad for a gig you can do from home. It says you’ll work with customers of household name brands like Chanel and Nordstrom. You can work in your pajamas, even. Sounds great, right?

Hang on. The hiring company isn’t Chanel or Nordstrom. Instead, it’s a third-party business that handles those name brands’ customer service. And the fine print says you’ll get paid by the minute of logged phone time instead of a flat hourly wage. The position might be full time, but you won’t get benefits since you’ll be considered an independent contractor. Because you’re your own boss!

Remote positions like these are becoming more common — even with legitimate employers.

Alexandrea Ravenelle, a gig economy researcher and professor at the University of North Carolina and author of “Hustle and Gig,” says the not-so-savory aspects of those remote jobs are part of a broader trend that she refers to as the “gigification of the workforce.”

“Gigification of the workforce is where we start to see some of the elements of gig work or independent contracting work starting to be applied to other types of professions,” she said.

For example, tech companies like Uber and DoorDash hire hordes of independently contracted gig workers, who aren’t considered employees, and pay them per completed ride or delivery, not by the hour. These gig workers aren’t eligible for typical benefits, either.

Now these practices are creeping into office work, especially remote office work.

“The pandemic, if anything, is really bringing this to the forefront,” she said.

Here’s what you should keep in mind when hunting for remote work.

First, Make Sure the Company — and the Listing — Is Legit

Before you start weighing a company’s work-from-home policies, first verify the company is indeed real. More than that, be sure to confirm that the job listing was posted by the hiring company. Avoiding scams should be your first step.

Use these quick tips to confirm a remote job listing is legitimate.

  • Didn’t apply anywhere? Don’t send “recruiters” any information. According to the Federal Trade Commission, fake recruiters reach out via email or over the phone to ask you for your personal information for a job opening at a recognizable company. Don’t share anything with them if you haven’t applied anywhere or requested to be contacted. Reputable remote employers don’t solicit applicants this way. If you are unsure and don’t want to ruin any prospects, you can say something along the lines of: “Thank you for your interest. Let me confirm with the company, and I’ll get back to you.”
The Penny Hoarder vets remote companies and jobs and posts them in our free Work-From-Home Jobs portal.
  • Job boards are helpful, but don’t stop there. Finding a job through a website like Indeed is a good starting point, but we recommend that you don’t apply via Indeed because scammers can make convincing listings with logos and details of real companies. They can use these fake listings to harvest your information and groom you for more scams. When you find a job listing through a third party like Indeed, always check the hiring company’s website for the original listing to ensure it’s a real opening and apply there.
  • Research the company. Say you found a good-looking opportunity that’s listed directly on a company’s web page. Be vigilant. You’re still not done vetting. Look up the company to see if it’s a reputable employer. Glassdoor can be a helpful tool in seeing what other workers have to say. You should also verify the company’s website URL with the one listed on its Glassdoor profile. If no Glassdoor profile exists, see if they have an active Facebook account. Still no luck? Use a search engine to find out if the company has been mentioned in any media outlets, especially ones local to its supposed headquarters. If none of these methods turn out fruitful, move on.

If all else fails, confirm with the company directly.

“There’s no shame in calling the company. Research the company online, find their direct dial and call HR,” said Ravenelle.

A person works on a laptop.
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What Else to Look Out for on Your Remote Job Hunt

Some office jobs, now going remote, are starting to look a lot like gig work.

Here are some trending hiring practices you should be skeptical of. Again, they may not be immediate indicators the job is a scam, but they should nevertheless be heavily factored into your decision to work for the company.

Bring Your Own Office

Specific office equipment requirements are common for remote employers. Reputable employers will either send you the necessary equipment or give you a stipend to make sure your office is up to par, but it’s also common that you’ll need to shell out money for a few upgrades.

Some companies have modest policies such as requiring you to have a Windows-based computer and high-speed internet. Fair enough. Other companies are more demanding. They may require lockable filing cabinets, 17-inch dual-screen monitors, specific RAM and processing speed requirements for your computer and noise-canceling USB headsets with an attached microphone. Offloading all those costs onto you should be a red flag.

“Previously, white-collar workers would go into offices and have access to a company printer, and they’d have access to the company coffee pot, and they’d have access to the company’s air conditioning and electricity and computers.” Ravenelle said. “Now they have to outfit their own office space with office supplies and furniture and all the resources for work.”

Mind how those expenses add up, especially if you haven’t received a job offer in writing yet.

Pro Tip

Just because you’ve confirmed that an employer is real does not mean they treat their workers ethically.

Pay Per Minute

At some remote call centers, you’ll notice that wages are determined by the minute not the hour.

For example, you may have the “potential” to earn $15 an hour. That figure is calculated based on how many minutes of phone-time you log. So, really, you’re earning 25 cents per minute.

It’s theoretically possible to speak with a customer for an entire hour nonstop, but the reality is that you’re likely to have a few calls each hour, and the time spent dialing the phone, getting hung up on, or even emailing your co-workers won’t be paid.

This type of focus on the task, as opposed to holistic job responsibilities, is another big red flag.

Background Check Fees

Any request for money during the hiring process should automatically set off alarm bells, according to the Federal Trade Commission.

In many cases, paying anything to a company is a clear hallmark of a scam. But in some instances, a real company may ask you to pay for your own background check.

“That’s an expense of employment that the company should be paying,” Ravenelle said.

A company might do this to keep hiring and labor costs down.. And, of course, if the background check doesn’t come back squeaky clean, you won’t get hired and you’re out of however much you paid.

Even if you’ve done your due diligence and verified the company is legitimate, this practice should be at the top of your list of deal breakers.

Software Fees

As ProPublica recently unveiled in an investigation of several large customer service outsourcing firms, you may effectively be paying to work for some companies. ProPublica focused on Arise, an independent business owner “platform” that charges its workforce of independent contractors to access software needed to connect with callers.

Companies do this by convincing their workforce that they’re business owners. That monthly software fee deducted from your paycheck? That’s a cost of doing business.

This practice somewhat mirrors the policies of popular websites like Etsy or Upwork, which charge you fees to use their site to sell products or services. But in those cases, the websites run more like marketplaces where you can set your own rates and prices.

In the case of Etsy, you’re physically making a product for sale. On Upwork, you get to choose your clients and offer projects and services at an agreed-upon price.

Bottom line: If you’re hired by a remote call center or other outsourcing firm, they should be paying you. Not the other way around.

Independent Contractor Status

Being an independent contractor — also referred to as a 1099 worker — is not an inherently bad thing. Freelancing, for example, is a common form of 1099 work. Driving for Uber? 1099 work.

Looking for work? Check out this list of 11 legitimate work-from-home jobs in 2020.

Things get tricky when the line between independent contractors and employees gets blurred.

It’s becoming more common for companies to hire workers as independent contractors while asking them to attend mandatory training, work at a desk or home office with specific rules, be available between 9 a.m and 5 p.m. Monday through Friday and get paid an hourly (or by-the-minute) wage.

According to the IRS, such stipulations mean the worker should be considered a W-2 employee.

Misclassifying workers as independent contractors is illegal. Companies do this anyway to avoid paying Social Security, workers compensation and unemployment insurance taxes; overtime; paid time off; health-care benefits and more, Ravenelle says.

Pro Tip

Be skeptical of accepting a gig as an independent contractor if the work sounds just like a regular full- or part-time job. Even if it's remote.

“Being [misclassified as] an independent contractor means that you are outside generations of hard-won workplace protections. It means that, in many cases, you may have fewer workplace protections than your grandparents did — and possibly even your great grandparents,” she said.

In short, being classified as an independent contractor makes you cheaper to hire and easier to fire. If you’re eyeing two jobs and one considers you an independent contractor and the other a W-2 employee, Ravenelle recommends going with the job where you’ll be treated as an employee.

Adam Hardy is a staff writer at The Penny Hoarder. He covers the gig economy, entrepreneurship and unique ways to make money. Read his ​latest articles here, or say hi on Twitter @hardyjournalism.