5 legal pitfalls of telecommuting
Companies across the country are looking for ways to help workers cope with rising gas costs. But many might be offering flexible arrangements too quickly without considering the legal consequences.
One way more and more employers are trying to lower costs and raise flexibility is letting some employees telecommute at least one day a week. That can be a big boost to recruitment, retention and employee satisfaction, but it also comes with a fair share of legal challenges.
Here some things to keep in mind if your company’s thinking about allowing any telecommuting:
Security — In some cases, employers can be held liable when personal information about employees or customers is stolen. Since employees working from home are more prone to security problems than others, special care is needed when telecommuters work with sensitive information. Managers need to work closely with IT to make sure employees have a secure set-up before they do any work from home.
Also, clear ground rules need to be established, such as:
- no working on public wireless networks
- family members or other people shouldn’t use the company’s equipment, and
- any data in physical form (CDs, paper documents, etc.) must be kept in a secure place.
Safety — The Occupational Safety and Health Administration (OSHA) has made it clear it won’t inspect home offices — or require employers to inspect them. Nonetheless, employers should be ready to handle claims of injuries from people working at home, since they might be entitled to worker’s comp.
Guidelines and rulings are unclear about when telecommuters get comp — it depends on the state and the specific situation surrounding the injury. It’s something employers with work-from-home programs must be ready for, since teleworkers are often eligible.
Time-tracking – As telecommuting gains popularity, it’s not just exempt employees who get the benefit. Nonexempt employees are taking advantage, too, which creates some new legal issues.
For example, keeping track of the time a nonexempt employee works can be tough without a clock to punch as soon as someone walks in the door.
What’s a good solution? Some companies install timeclock software that lets telecommuters clock in over the phone or by logging in to their computers.
Overtime — Also, it’s sometimes hard enough to keep nonexempt employees from working unauthorized overtime hours — and the problem multiplies with people away from the workplace.
To limit problems, companies need a clear policy regarding when and how much employees are allowed to work. Or, managers can consider only letting exempt employees telecommute.
Discrimination — As with any benefit, if it’s given to some employees and not others, there’s always a chance someone might claim discrimination. Before rolling out a telecommuting program, employers should have rules on who’s eligible based on objective criteria — for example, position type, department, seniority, performance, attendance records, etc.
Comments
2 Comments on 5 legal pitfalls of telecommuting
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Nicole Belson Goluboff, Esq. on
Sat, 19th Jul 2008 6:45 am
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Owen on
Wed, 23rd Jul 2008 2:15 pm
Another legal consequence of which both telecommuters and employers must be aware is the potential for a tax penalty imposed on the telecommuter if he and the employer are located in different states. If, for example, a Connecticut resident is employed by a New York company and the company allows him to telecommute a few days a week, New York will tax him, not only on the wages he earns on his office-bound days, but also on the wages he earns on his Connecticut days. Because Connecticut will also tax the income he earns in Connecticut, the telecommuter will be double taxed on that income.
In some cases, the home state may grant a credit for taxes the telecommuter pays New York on his home state income. But if New York has a higher tax rate than the home state, the telecommuter will still be penalized, forced to pay the New York rate on the home state income.
The cost of the telecommuter tax can exceed the potential savings on gasoline a part-time telework arrangement is designed to provide.
Companies considering allowing interstate telework must determine for which states they have to withhold. They must also be aware that they may not be able to take full advantage of the recruitment, retention, productivity and cost saving benefits of telework, because the telework penalty can discourage out-of-state applicants and employees from accepting an offer to telecommute.
Proposed federal legislation called the Telecommuter Tax Fairness Act would eliminate the problem, prohibiting states from taxing the income nonresidents earn on the days they work at home. The bill is a bi-partisan measure currently pending in both the House and Senate. Both employers and employees seeking to expand the use of telework in their organizations should let their Congressional delegates know that this legislation is a necessary part of the solution to the gas price crisis we face.
Consider, that positions in which work can be efficiently completed from home, can qualify as reasonable accommodation opportunities for people with disabilities to return to work as valuable employees. Then, think about whether ADA trumps Fair Labor Standards etc. Also think about engaging people with disabilities as independent contractors working from their homes with an independent central support system like the one we provide at THE-Group to disabled professionals, senior managers and executives who associate with us so they can work from home. By employing the talent and the experience of disabled professionals, senior managers and executives who are silently eliminated from re-employment consideration [89% national unemployment rate vs 60% for other disabled people] employers can have the best of both worlds, employing the talents of top talent while maintaining the status quo.
Its worth considering as a low risk solution to acquiring talent.
Owen P. Doonan III, Chairman of the Board
THE-Group [The Handi-CAPABLE Executive Group]
Virtual management, IT & mentor consultants to Entrepreneurs, Professionals and Executives with disabilities. Advocates for virtual access to public meetings and home based employment for the homebound and people with severe limiting disabilities.
Statutory Member, Massachusetts State Rehabilitation Council.
Chairman, Massachusetts State Rehabilitation Council’s Consumer Satisfaction Committee
Chairman, Massachusetts Statewide Task force on Home Based and Self Employment for people with disabilities
Member, AT [Assistive Technology] Act Advisory Council
Founding member Massachusetts Statewide Task force on Acquired Brain Injury [ABI] & Traumatic Brain Injury [TBI].
Member Easter Seals – MRC Assistive Technology Loan Review Committee
P.O.BOX 2169
DUXBURY, MA 02331
E-mail: mentor-one@usa.net
