In an age when more and more positions require duties to be carried out almost exclusively on computers, and where the Internet can instantly connect anyone anywhere, many companies are wrestling with the idea of allowing employees to work from home. While many employees are quick to support the idea, the nontraditional approach of telecommuting is foreign to many employers, leaving them uneasy about how it will affect their operation.
This Risk Insights is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.
© 2010 MyTPG.com All rights reserved.
There is no definitive answer as to whether telecommuting will be good or bad for your business. It comes with both pros and cons that can be influenced by a variety of factors such as company environment, type of work and individual employees. Because of all the variables that can affect the success or failure of employees working from home, most situations should be looked at on a case-by-case basis.
If applied in the right situations, telecommuting can have a variety of potential benefits for both your company and its employees:
Eliminating the commute: Telecommuting turns the potentially large block of time wasted during the commute to and from the office every day into time that employees can spend working. The lack of a commute means employers no longer have to deal with tardiness or absences caused by traffic accidents and weather. If employees are using company vehicles, eliminating an unnecessary drive to and from the office every day decreases the chance for accidents. With fewer vehicles on the road each day and fewer accidents on your company’s record, the cost of auto premiums will fall.
Space saver: If you want to add more personnel but don’t have space, telecommuting can save you from the constraints of your current accommodations without requiring the development of additional office space. Less office space with fewer employees and less expensive equipment means not only lower utility and upkeep costs, but also lower property insurance premiums.
If you decide to allow employees to work from home, make sure you have guidelines in place to help you reap the benefits of telecommuting without letting it disrupt your business.
Fewer sick days: Employees working at home have little direct contact with co-workers, meaning that they will be less likely to catch a cold or flu that may be going around the office. Less exposure to contagious disease helps employees who telecommute miss fewer days of work due to illness, which means increased productivity for your operation. Even if a work-at-home employee does become sick, they are more likely to remain productive since their illness does not affect their ability to come into the office. Fewer sick employees means lower overall operating costs and higher productivity for your business.
Attract and retain employees: Studies have shown that a majority of employees favor the option of telecommuting. Not only does this increase the moral and job satisfaction of current employees, but it can also be valuable when recruiting new talent. Hiring and retaining the best employees will help you save money on training costs, and more seasoned workers tend to have fewer injuries, contributing to lower workers’ compensation premiums.
While it can be very beneficial, telecommuting has some potential risks that your company should consider before it allows employees to work from home:
Limited employee supervision: One of the top reasons employers are leery of allowing employees to work from home is the inability to accurately monitor how time is used throughout the day. Besides the loss caused by unproductive workers, one substantial problem with the lack of supervision is the ease in which an employee can make fraudulent workers’ compensation claims. When injuries occur in the home instead of on-site, there is usually no witness to verify that it occurred while the employee was performing company duties and not while working on personal tasks around the home or home office. If employees make abusive workers’ compensation claims, policy premiums can increase. In general, telecommuting situations blur the line between what is and is not compensable under workers’ compensation laws.
Equipment costs: There are certain pieces of equipment that an employee will need to work from home, namely a computer and an Internet connection. They may also need other devices to help them communicate with their fellow employees. If the employee does not already have these things, the company will need to pay for them. Add these costs to the logistics of maintaining and repairing IT equipment that is away from your primary place of business, and this can become a significant investment for companies considering telecommuting.
Limited face-to-face time: Employees working from home are not as involved in the culture of your company. Not having an employee physically available for a meeting or discussion can be an added headache for those working in the office. Employees at home may have a tougher time being recognized for promotions or other advancements. This could lead to lower morale, and, again, problems with employee retention.
Security: The basis of telecommuting is the use of the Internet. When an employee is at the office, his or her work is protected by safety standards that keep your company’s’ network and data secure. However, an employee working from home may not have the same safety measures in place to protect company information they may be working on. Make sure employees are provided with security software and that you have the proper coverage, such as a cyber liability policy, to protect against a potential data breach.
Stop Problems Before They Start
If you allow employees to telecommute, make sure you institute an established program to minimize the risks. Decide on what types of positions in your company will be open to allow telecommuting, and detail what is expected of employees when it comes to productivity and time usage. Also, be sure to institute security procedures that will keep sensitive company information safe at home offices. Having guidelines in place will help you reap the benefits of telecommuting without letting it disrupt your business or lead to increased liabilities and costs.