I worked for a New York based company once, and I was moving to Washington State and planned to continue to work remotely. I told my manager, he told his manager, everything was approved...until I sent out my goodbye email - turns out they never told HR. They had just assumed it would be fine since another employee was working remotely from Montana. However WA requires companies to pay WA taxes if they have any employees there (or something like that, I forget the exact details).

The solution was to make me a contractor and it more or less worked out in the end.

The point is, hiring remote workers can have all sorts of legal and financial hurdles, even when the remote workers are in the same country. Larger companies often have global employees and are used to and capable of handling these issues but smaller companies may not be so well equipped.

Why?