Why Telecommuters Are Suing Their Employers

Every day, while most of us are still stuck on the expressway, more than 12 mill
ion U.S. employees are already at work after making the shortest commute possibl
e for them to make: the distance from the bedroom to the home office.
Welcome to the wonderful world of telecommuting . working from home and keeping
in touch with company HQ via phone, fax, and email.
It’s a growing world — up 40 percent in a single year, according to the employme
nt organization WorldatWork — and for many telecommuters, it’s a perfect setup.
There are no costly commuting expenses, and many workers enjoy reduced childcare
costs. Surroundings are comfortable and casual, and the home worker gets to say
, "Honey, I’m home!" mere seconds after shutting down the computer. Why, then, a
re so many telecommuters suing their employers?
That’s right, suing. Over wage and hour issues. Reimbursement of travel costs on
days they do have to come in. Even, potentially, over safety matters.
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The lawsuits are neither small nor cheap. Farmers Insurance was hit with a $90 m
illion jury verdict when its home-based adjusters took the company to court over
overtime issues. IBM settled a similar case for $65 million.
The crux of the issue is control. Without direct on-site supervision, employers
simply don’t have a good handle on how many hours employees work, whether they’r
e following company policy, and even whether home offices are properly set up so
that workers don’t lose client information or injure themselves using ergonomic
ally unsound equipment.
The solution lies in thinking through all the issues and implementing a set of s
olid policies at the start of any telecommuting relationship. Here’s what the ex
perts suggest:
• Wage and hour. Institute exact written agreements of when the worker wil
l be on — and off — the job; do not allow overtime without prior approval; and p
ut in place some time-tracking mechanism such as computer login-logout tracking
or a requirement to call in when starting and finishing work. These measures are
especially essential when dealing with nonexempt workers.
• Enforce work schedules. "The mere promulgation of a rule against [unwant
ed overtime] is not enough," says a report from international law firm Morgan, L
ewis & Bockius LLP. "Management has the power to enforce the rule and must make
every effort to do so."
• Travel expenses. Establish beforehand whether employees are responsible
for paying their own transportation costs when coming into the office. The gener
al rule is that once workers have done the first "principal activity" of the wor
kday, they’re on the clock when they’re on the road. If the trip in is the first
thing, however, it’s more likely a commute to work, and not reimbursable.
• Equipment. Who owns the equipment a telecommuter uses at home? If it’s y
ours, be sure there’s a policy with permitted use and required care spelled out.
Cal/OSHA doesn’t generally inspect home offices, but you should still insist on
(and offer to pay for) ergonomically sound office furniture, keyboards, and the
like. Also, establish beforehand who will pay the costs of using the equipment.
Finally, have a procedure in place for the disposition of company equipment if
the worker leaves your employ.
• Proprietary information. The same restrictions should apply at home as i
n the office. Be sure employees take appropriate measures to secure vital data,
such as installing a proper firewall on their computers, and offer to pay for th
ese measures.
• ADA/FEHA interface. Telecommuting may be a reasonable accommodation for
employees with disabilities who cannot come to a central worksite. However, you
should have (and document) a strong case for this accommodation, or you risk bia
s charges from other employees who are not allowed to telecommute.
"Telecommuting-related litigation is likely to grow in tandem with the telecommu
ting phenomenon unless companies are careful to treat all their employees equall
y," says employment law attorney Sara Goldsmith Schwartz. "If companies treat [t
elecommuters] more like regular employees, there will be less litigation."
Out of Sight, Out of Court? Don’t Bet On It
Telecommuting’s appeal shows no signs of slowing down — and why would it? Worker
s enjoy the flexibility and freedom, while employers appreciate the reduced over
head.
More and more workers of all stripes are hopping aboard the telecommuting bandwa
gon — and that’s where the trouble can start.
If you allow nonexempt employees to work from home, you still need to keep track
of their comings and goings, just as you would if they were in the office. You
need to be sure they’re taking their required meal and rest breaks, that they’re
not working unauthorized overtime, and that they’re not in fact on the clock (i
n the form of work-related emails, texts, or phone calls) when they should be of
f it. And if you mismanage any of this, you could be on the hook for an extremel
y costly wage/hour lawsuit.
Suddenly, the freedom of telecommuting just got a lot less free.