RISKVUE ARCHIVE | FEATURE STORIES

Telecommuting:
Bring The Work (But Not The Risks) To The Worker

Welcome to the future of work. Telecommuting, also known as telework, uses telecommunications to allow employees to work offsite one or more days a week. Telecommuters can work at home, in corporate-owned satellite offices, or in independent “telecommuting centers,” which rent space to telecommuters from many companies. There, they have access to fax machines, copiers, secretarial services, conference rooms and other amenities.

Benefits

Telecommuting helps employers in the following ways:

• Reduces overhead. Telecommuters who work at home don’t need office space, thus reducing the company’s space requirements and energy consumption. Moving employees to company-owned satellite offices may also bring cost savings, due to lower rents in suburban areas.
• Increases worker productivity. The State of California Telecommuting Pilot program reported that telecommuting increased productivity by 10–30 percent. Reduced or no commute time, reduced stress and fewer distractions may account for this.
• Enhances employee retention. The California Telecommuting Pilot program found that telecommuting helped the employer retain the services of mothers during maternity leaves.
• Reduces worker stress. Telecommuters generally experienced more positive changes in their personal and work relationships than did the members of the control group.
• Helps recruitment of in-demand workers. Telecommuting removes geographical barriers—you can hire the most qualified workers, no matter where they’re located. And as more companies permit telecommuting, you’ll probably find that offering telecommuting becomes a competitive necessity.
• May reduce the cost of disabilities. Telecommuting may help injured workers stay productive or ease back into the workplace while they recuperate.
• Helps compliance with air pollution and trip-reduction regulations. The federal Clean Air Act Amendments of 1990 require cities with certain levels of ozone pollution to implement trip-reduction programs. Employers with more than 100 workers at a site in these cities must take steps to reduce employee commutes. In addition, many states and localities (such as the San Francisco Bay area) have their own trip-reduction mandates.
• Reduces absenteeism. Pacific Bell found that telecommuting workers experienced 25 percent fewer absences than their peers. Working at home helps employees continue to work while dealing with emergency child care situations or minor illnesses that might make it undesirable to go into the office.
• Can accommodate employees with disabilities. Telecommuting may constitute a “reasonable accommodation” for employees with disabilities. (See discussion later.)
• Can create continuity after a disaster. When a disaster, such as earthquake, flood or fire, destroys your main facility, telecommuters can often continue to work. If telecommuters must access information on company computer networks, you may want to consider having a backup network offsite.

Risks

Telecommuting isn’t for everyone

Certain jobs lend themselves to telecommuting. Information workers are an obvious choice; manufacturing workers aren’t. Professionals comprised the majority (72 percent) of telecommuters in the California Telecommuting Project, a state-sponsored study of telecommuting among state workers. In this program, jobs ranged from accountants to researchers and included administrative law judges, lawyers, policy analysts and appraisers.

Where professional or skilled workers are represented by a union, you may experience resistance. Unions may see telecommuting as a way for employers to get around overtime and other work rules. To overcome these objections and enlist union support, be sure to include a labor relations representative in the planning process.

Certain types of people also make better telecommuters than others. When determining who in your company may be eligible for telecommuting, look for people who are independent, experienced, self-motivated and disciplined. The California Telecommuting Pilot program found many telecommuters experienced “break-in” strains for a few months. However, after the first year, telecommuters’ effectiveness evaluations and quality-of-life indicators continued to improve.

Screen workers to avoid problems

To avoid problems in productivity or morale, select the right kind of worker. Your company’s telecommuting policy should clearly state that telecommuting isn’t a right, it’s a privilege. It should also state that telecommuting is not meant as a way around obtaining childcare—a worker should not have the responsibility of caring for young children while telecommuting.

Likewise, never impose telework on a worker. Some workers feel too isolated or distracted when working at home. Make your program voluntary.

Screen potential telecommuters before allowing them to telework. Make sure they have proven abilities to manage their time and work well. Weed out candidates who need constant supervision or feedback.

Don’t forget the people who manage and supervise teleworkers—can they evaluate a worker’s performance without counting on “face time,” or the time the worker is seen in the office? To avoid problems and misunderstandings, spell out telecommuters’ responsibilities and job tasks and how their performance will be evaluated before the worker begins telecommuting.

A home office has pros...and cons

The majority of telecommuters work at home. Working at home eliminates commute time and rent expenses for that worker. But there are disadvantages. Does the worker have the necessary space? More importantly, is that space suitable? The company has the responsibility of making sure employees’ workplaces meet OSHA work safety and indoor air quality regulations—even if their home is their workplace. Likewise, injuries that occur while the worker is “on the job,” even at home, fall under your company’s workers’ compensation.

Many employers are reluctant to inspect a telecommuter’s work site for fear of invading his/her privacy Basing your telecommuters out of telecommuting centers can help you avoid this problem. We’ll discuss work safety concerns—and what you can do about them—later in this article.

Avoid equipment ownership disputes

Some of your potential telecommuters may already have a home office. If not, you will have to provide the necessary equipment. It costs approximately $4,000 to equip an average home office with a work station, computer, telephone, fax machine, file cabinets, and possibly a printer.

Your telework agreement should list office equipment and who owns it. If it’s company property that you expect the worker to return when terminating the telework arrangement or employment with the company, then say so in the agreement.

Don’t forget equipment maintenance/service

Who will be responsible for routine maintenance and service on equipment? If equipment is damaged by misuse, who is responsible for repairs? It may make sense to put the telecommuter equipment (even if employee-owned) under company maintenance contracts. Just make sure maintenance/repair services are available in that area.

Telecommuting may make equipment maintenance and service more difficult, particularly when telecommuters are located away from major metropolitan areas. You can avoid some problems by providing telecommuters with training in basic equipment maintenance and repair tasks. (Check equipment warranties and service contracts first-service provided by non-authorized repair people will void some warranties.) Expect to spend between $1,000 and $2,000 per year on maintenance.

Don’t rely on a telecommuters homeowners policy

The telecommuting agreement should also address insurance issues. Most homeowners policies exclude coverage for business property (even if owned by the insured), unless specifically listed on the policy. A broadly worded business property policy automatically covers the company’s “personal property” (basically, immovable property, or everything but real estate), no matter where it is. As a practical matter, however, you may want to specifically list such off-premises equipment in your policy.

Secure your data

Most telecommuters need access to information stored on company computer networks. Before permitting workers to telecommute, determine the risk this would pose to your company’s data. Will the worker need access to/be transmitting confidential financial data? Proprietary or trade secrets? The frequency with which this information will be transmitted and its sensitivity will determine what type of security measures to take. Some of the simpler, less expensive (but less secure) methods of data protection include password protection; restricted access lists, which limit network access to computers dialing in from certain telephone numbers or certain Internet addresses; and callback devices, which deny access until a user is called back and inputs a password. Encryption tools can provide security for more sensitive data. And of course, you can combine some or all of these methods.

Avoid intellectual property disputes

Works created or devices invented by an employee using company equipment while on company time are generally considered “works for hire” and automatically become company property. Likewise, the company automatically owns works created by a telecommuter on company time. But what about works created on the employee’s own time? What if the telecommuter doesn’t have fixed hours?

Prevent such questions from becoming problems by detailing telecommuters’ responsibilities, the projects they are to work on, and the company’s ownership interest in these projects.

Avoid these liability exposures

Business visitors: The standard commercial general liability policy covers the company when it’s responsible for injury to third parties. This coverage should apply even to injuries that occur at a telecommuter’s home office. But as a practical matter, you may want to double-check with your liability insurer. Don’t rely on the telecommuters homeowners policy—most homeowners policies exclude liability coverage for business activities.

Workers’ compensation: The company’s workers’ compensation coverage applies to injuries that occur in the course and scope of employment. When a telecommuter has an injury at home, how do you determine whether it was work-related or not? Workers’ compensation laws are generally silent on this issue; until cases arise and courts or legislatures tackle it, you’re entering another legal gray zone.

Some companies solve this problem by requiring telecommuters to work set hours. Injuries that occur in this time period are assumed to be work-related, others are not. However, flexibility is one of the chief benefits of telecommuting. If you don’t want to set up rigid schedules for telecommuters, you can separate a telecommuters work time from personal time by using some kind of log-in system. Telecommuters can call in to the office when beginning and ending their day, log in to the company’s network, use a logging device on their own computer, or manually record their working hours.

Whichever method you use, make sure telecommuters know what to do after a work-related injury. Does your company have a preferred workers’ compensation medical provider(s) near the telecommuter? Give the telecommuter the name, address and phone number of such providers, and emphasize the importance of reporting work-related injuries to your company’s workers’ compensation claims administrator immediately.

Prevent health and safety problems

Telecommuters, whether they work at home or a telecommuting center or even at a client’s location, still fall under occupational safety and health regulations. Employers still have responsibility for the safety of these workers, even when they work at home.

Ergonomics: Most telecommuting employees face a risk of repetitive stress injuries (RSIs), due to heavy computer use. Although you have no legal obligation to provide ergonomic training or equipment, you may still want to do so, from both a moral and practical standpoint. RSIs can be painful and disabling, causing lost time and productivity, so protect your valued employees by providing ergonomic training and equipment.

Air quality: Federal OSHA air quality standards are on hold; however, if proposed regulations do go into effect, employers may have to ensure home-based workstations comply as well.

Safety: To prevent injuries, you can inspect home-based worksites. As an alternative, you can have potential telecommuters complete and sign a checklist. The Oregon Department of Energy has an excellent checklist you can refer to.

Employment laws apply to telecommuters

Overtime: Overtime is usually not an issue for exempt employees. However, when non-exempt employees telecommute, you must comply with Fair Labor Standards Act (“FLSA”) and state overtime regulations. A log-in system (described previously) can help you ensure that employees don’t overstate their hours to claim unearned compensation or understate them and expose the company to potential FLSA liability. If non-exempt employees need to work overtime, require them to obtain a supervisor’s permission before working extra hours.

Family and Medical Leave Act: The federal FMLA and state leave laws apply to telecommuting employees as well as regular employees. Inform your telecommuters of your company’s leave policies, including leave requests and use of forms. Telecommuting may create administrative problems when telecommuters actually go on leave. Unless you have a log-in system, it will be very difficult to accurately maintain leave records.

Americans With Disabilities Act: The Americans with Disabilities Act requires employers to make “reasonable accommodations” for employees with disabilities. For these workers, telecommuting can reduce the strain of getting to their jobs. Even when you require a telecommuter to furnish his or her own office equipment, the company may have to provide special devices to accommodate a disability, such as telephone amplifiers or large-screen monitors.

When you start a company telecommuting program, you’ll be venturing into uncharted territory. But with sound written policies and a little risk management, you can enjoy the benefits—and avoid the risks. 

riskVue | The webzine for risk management professionals
December 2000