Telecommuting offers both employers and employees several benefits. It can increase productivity and morale, reduce turnover, and be convenient, cost effective and eco-friendly. Before you suggest telecommuting, understand the potential legal risks.
For related insurance product examples, see Hotel Courtesy Insurance.
Legal issues to consider
-
Wage and hour issues
The Fair Labor Standards Act establishes rules for hourly wages and overtime pay. Employers can face liability if they fail to follow those rules for telecommuting workers.
Ensure compliance by
- Requiring telecommuting employees to sign a written agreement that outlines work hours and overtime expectations.
- Requiring telecommuting employees to clock in and out with an online or paper time tracker and agreeing not to perform work-related tasks when off the clock.
- Limiting telecommuting where appropriate to employees who meet the salary-and-duty tests for exemption under federal law.
-
Employee privacy
Even when employees work from home, employers may monitor activity to ensure safety and compliance with company policies.
Potential telecommuting employees should understand that employers may monitor email for productivity, check internet history, limit access to certain websites during work hours, and require use of company-provided equipment.
-
Confidential information
Telecommuting employees must protect confidential information. Breaches can harm clients and expose both the company and the employee to legal risk.
Best practices
- Have telecommuting employees sign a nondisclosure agreement that enforces confidentiality.
- Require employees to log out of computers or accounts when away from their desk.
- Require use of secure Wi‑Fi and limit access to confidential files.
- Prohibit allowing others to view confidential client files.
-
Employer liability
If a telecommuting employee is injured at home while working, uses company equipment for illegal activity, or sends harassing messages while clocked in, the employer could face liability. A clear telecommuting policy can address these issues and limit exposure.
-
Discrimination and reasonable accommodations
Offer telecommuting opportunities consistently and avoid giving the perk to only certain groups. Employers must also consider requests for telecommuting as a potential reasonable accommodation under disability laws when appropriate.
Telecommuting is beneficial for employers and employees, but it carries several legal risks. Make arrangements—written policies, training and security practices—to address these risks and protect your business and staff.
For additional product examples, see Crowns and Closures Insurance.
If you're unsure how telecommuting affects your coverage or policies, talk to your agent.
Frequently Asked Questions
Can an employer monitor a remote employee's email?
Yes; employers generally may monitor work email and activity on company-provided devices to ensure productivity and compliance, subject to applicable privacy laws.
Do telecommuting employees need to record their time?
Nonexempt telecommuting employees should record hours worked and follow employer timekeeping policies to ensure proper wage and overtime payment.
How can employers protect confidential information when employees work from home?
Use nondisclosure agreements, limit access to sensitive files, require secure networks, and provide company-managed devices when possible.