Not nexus, but “nice-us”. This is a reference to employers who offer Courtesy Withholding Tax to their employees who reside in places where the employer has no established business operations.
An employer is not legally required to withhold state (or local) income taxes in states (or localities) where they don’t have nexus. It is technically the responsibility of the employee to make sure that his or her tax liability is covered and not the responsibility of the employer if the company has no nexus.
However, as a nice perk to employees, it is quite common for employers to offer Courtesy Withholding Tax for these employees. That means the employer must register with the state (or locality) and establish an account so that wages and withheld taxes can be reported and paid on behalf of these employees. If this sounds like something you would like to offer your employees, there are some things to watch out for - establishing these accounts can send up red flags for other state agencies to ask you questions. For example - Should you be paying Sales & Use Tax in my state? Or should you be paying Unemployment Tax in my state? Etc. So you may need to weigh these considerations before you start being too “nice-us”!