Out of Sight, On Your Mind: Legal and Practical Considerations for Managing a Remote Workforce October 24, 2013 John R. Carrigan, Jr., Esquire carriganj@ballardspahr.com Leslie A. Eaton, Esquire eaton@ballardspahr.com
Today s Remote Workforce Telecommuting is a practice in which an employee works at a location often his or her home that is remote from the actual business facility at which he [or] she is employed. Under this arrangement, the employee maintains close contact with coworkers and supervisors via various forms of computer, Internet, and communication technology (i.e., electronic mail, telephone, computer, networks, etc.). - US Legal.com, Telecommuting Law & Legal Definition, http://definitions.uslegal.com/t/telecommuting/ (last visited Oct. 4, 2013). 2
Today s Remote Workforce Based on statistics compiled by the Telework Research Network and WorldatWork, more than 50% of employers offer regular telecommuting arrangements. As many as 17% of employees telecommute either entirely or as part of their workweek. As of 2011, about 2.3% of the U.S. workforce (about 3 million people) considered their home to be their primary place of work. Telecommuters on average work from home about 2.5 days per week. 3
Today s Remote Workforce Relative to the total population, a disproportionate share of management, professional, sales and office workers telecommute. Telecommuters tend to be older and better educated than the average worker. According to the Telework Research Network, the typical telecommuter is a 49-year-old, college-educated, salaried, non-union employee in a management or professional role, earning $58,000 a year at a company with more than 100 employees. State and (especially) federal government workers are becoming increasingly likely to work from home. 4
Telework Enhancement Act of 2010 Required federal agencies to establish a policy under which eligible employees can telework. Required each agency to determine eligibility criteria for all of its employees to participate in telework. Any federal employee wishing to telework must enter into a written telework agreement. - No federal employee is required to telework under the statute, but may be required to work under terms of telework agreement including working outside of normal schedule after employee enters into agreement. Agencies provide telework training which must be completed prior to a worker signing a telework agreement. In December 2010, the Office of Personnel Management issued a memorandum explaining how federal employees may be permitted unscheduled telework in emergencies. 5
Today s Remote Workforce Possible advantages of utilizing remote workers: Saves money on overhead Lowers absenteeism Improves continuity of operations Enhances productivity Aids in recruiting Remote workers report higher job satisfaction 6
Today s Remote Workforce Possible disadvantages of using remote workers: Difficulty in supervision Concerns over change in corporate/organization culture Few opportunities for team synergy Start-up costs Possible burn-out issues Some remote workers may miss out on advancement opportunities 7
Drafting a Telecommuting Policy Definitions Explanation of organization s commitment to telecommuting and general principles (e.g., policy may specify that telecommuting is not being offered to avoid paying for child care) Voluntary Selection criteria Performance evaluation Time-keeping 8
Drafting a Telecommuting Policy Inspection Expectations with regard to attendance at main office Employer s sole discretion Process for terminating work from home arrangements Reimbursement policies Privacy issues New hires not eligible 9
Picking The Team Is the work to be performed well-suited to remote work? Is the candidate well-suited to remote work? No requirement that only exempt employees may work remotely, but recognize risks in having hourly employees work off-site. 10
Picking The Team Watch out for possible discriminatory practices in selecting employees for remote work. Consider preparing objective performance standards to determine eligibility. Document reasons for decisions to allow or not allow telecommuting as to particular candidates. If attendance record is a criteria for eligibility, be sensitive to absences resulting from alleged disability. 11
Picking The Team The Americans with Disabilities Act requires employers to provide reasonable accommodations to qualified individuals with a disability. EEOC Guidance: not all persons with disabilities need or want to work from home. And not all jobs can be performed at home. But, allowing an employee to work at home may be a reasonable accommodation if the person s disability prevents successfully performing the job on-site and the job, or parts of the job, can be performed at home without causing significant difficulty or expense. 12
Picking The Team Most courts that have examined the issue have agreed with employers who have claimed that a work from home arrangement is not a reasonable accommodation because essential work tasks require face-to-face on-site presence. Tide may be turning, as more courts recognize shifts in technology (meetings by teleconference, email, etc.). 13
Location, Location, Location Cross-border issues - Unemployment tax obligations? - Income tax obligations? - Different rules re: non-competes? - Exposure to state anti-discrimination and other local employment laws? - Zoning issues? - Does WC insurance apply out of state? 14
Location, Location, Location FMLA eligibility requires that employee work at a location where company employs 50 or more employees within 75 miles. According to Department of Labor regulations, employees who work at home, as under the new concept of flexiplace are deemed employed at the worksite to which they report and from which assignments are made. 29 C.F.R. 825.111. The employee s residence is not a worksite. 15
Setting Up Shop The Company should make clear that it has a right of access and may conduct routine inspections to ensure safety of workplace. OSHA (and related state statutes) require employer to maintain a workplace that is free of hazards that are likely to cause serious harm or injury to its employees and OSHA has taken the position that this can include homebased worksites. OSHA does not conduct routine inspections in private homes. 16
Sample Initial Inspection Checklist Does employee have tools/technology to do the job? Ergonomically correct office set up? Obvious distractions? Smoke detector? Adequate ventilation? No obstructions preventing movement and visibility? More than one way out of work area (e.g. door and window?) 17
Sample Initial Inspection Checklist Proper wiring? Aisles and passageways kept clean? Adequate security? Adequate protections for network? Adequate protections for Company IP? Automatic data backup? 18
Setting Up Shop Policies should be clear that employees do not retain an expectation of privacy in devices they connect to the Company network or use to perform Company work. ADA may require special equipment (wrist rests, orthopedic chairs) just as if employee were working from regular office, but probably would not require building wheelchair ramps or other major architectural changes. 19
Setting Up Shop Consider potential liability for injuries to employee, business visitors, or family members. Workers compensation statutes generally cover workrelated injuries, regardless of whether they occur on employer s premises, and work-related has been treated broadly for telecommuters. Reduce liability for potential gray area issues by including language in telecommuting agreement identifying work time and work areas, and require prompt reporting of alleged injuries. 20
Monitoring and Managing Company and employee should both understand the importance of staying connected. Telecommuters face risks of isolation and may feel inadvertently excluded from regular office life. Consider inviting telecommuters to participate in regular on-site meetings and social gatherings with regular on-site workers. 21
Monitoring and Managing Wage and Hour Issues: No exceptions to the FLSA just because employee works remotely. Risk of liability for unapproved overtime, even if rule forbids overtime without permission. Watch out for emails outside of working hours. Consider requiring log-off during meal periods if required by state law. 22
Monitoring and Managing Wage and Hour Issues: Consider monitoring time via login/logoff times, required emails to supervisor, time management software, etc. Consider whether travel time is compensable routine visits to main office likely are not compensable. Risks of misclassifying remote workers as independent contractors. 23
Monitoring and Managing Drug and Alcohol Issues: Telecommuters should be subject to same drug and alcohol testing procedures as rest of workforce. Consider application of drug and alcohol-free workplace policies on home office environment. 24
Monitoring and Managing Employees may assume they have greater rights to privacy in their home. Telecommuting employees should acknowledge consent to all forms of electronic monitoring as to communications made on company equipment. Consider possible implications of recording conversations (1 party consent states v. 2 party consent states). 25
Drafting a Telecommuting Agreement Duration of the arrangement Termination of the arrangement Company s right to inspect Duties Any change to salary/benefits/hours Schedule Method of timekeeping No representations re: tax liabilities Equipment/return of equipment 26
Drafting a Telecommuting Agreement Security obligations Voluntary participation Employment at-will Company policies fully applicable Trade secrets and confidential information Payment of expenses (e.g., utilities) Employee is obligated to maintain safe and hazard-free workplace Acknowledgement 27
Thank You! John R. Carrigan, Jr. carriganj@ballardspahr.com 424.204.4338 Leslie A. Eaton eaton@ballardspahr.com 303.299.7302 28