Have Employees Working From Home?

Beware! As an employer, do you allow employees to work from home?  If so, you need to consider a number of issues before making this a reality.

Tips For Mitigating Claims For At-Home Worksites

Telecommuting has many advantages for employers and employees. It reduces overhead costs for employers while giving employees the flexibility to structure their work days in a way that suits their schedule and family status. But at-home worksites are not without their disadvantages. Liability for off-site work premises claims can present a number of challenges for any discerning employer. Workers compensation laws as well as potential liability for third party claims create exposure for employers that they do not encounter in a typical office setting.

Precautionary steps to lessen the chance of employee claims:
  1. Create a Telecommuting Policy: Establishing clear ground rules for telecommuting employees is critical. The policy, preferably in written format, should outline the employer’s expectations for the employee during regularly scheduled work hours.
  2. Office Area and Ergonomics: Employer and employee should agree what area in the employee’s home will be the designated office area. Confining the work area to a specific site in the home will mitigate against claims for damages or bodily injury that occur in other areas of the house. Additionally, an employer should verify that the work site is ergonomically correct.
  3. Site Check: Employers can be held liable for providing a safe work environment for employees, regardless of where that office is located. Thus, an employer is wise to do regular site checks, when appropriate, to determine if there are known and/or apparent hazards that should be removed or eliminated.
  4. Fixed Hours: An employer and employee should agree on regular and fixed working hours as well as rest breaks. If there are no established fixed hours, an employee could arguably claim that an injury occurring at ANY time during the day is a workers compensation claim.
  5. Job Description: The employee’s job description should be detailed so that there is no discrepancy as to what activity is part of the employee’s job and what is not.
When an employee works from home, workers compensation boards and courts typically consider that the hazards encountered at home are also hazards of his or her employment. As such, eliminating much of the risk that goes along with at-home work sites is possible if a few basic steps are followed. A carefully designed telecommuting policy goes a long way towards mitigating those claims.

Wage and Hour Issues Involving Employees Working From Home

Another issue employers must address for telecommuting employees is properly paying employees for all time worked.   Employers must accurately assess whether employees are exempt from the overtime requirements of the Fair Labor Standards Act.  Employers have the burden to keep accurate records and to properly pay non-exempt employees for all time worked, including time an employee spends working from home.

There are several steps employers should take to mitigate the risk for non-exempt employees working from home:
  1. Time Reporting Policy: Implement policies on time reporting to ensure that employees are being paid for all time worked, including time worked from home.  Have employees sign time sheets, and establish set procedures for employees to report any problems with pay and then promptly address such issues.
  2. Policies and Training:  Have a policy that no one has authority to ask employees to report fewer hours than actually worked or to report more hours than worked.  Train supervisors to report to human resources when they suspect someone is working off the clock. Establish disciplinary procedures for employees who fail to report all time worked.
  3. Approval for Overtime: Establish procedures governing overtime hours such as employees are not permitted to work more than 40 hours per week without prior approval from their supervisor.
  4. Breaks:  Set rules regarding normal work hours and breaks and when employees are expected to be working at home.  Employers are required to pay for break times which are less than 30 minutes long.
  5. Attendance Policy: Establish an attendance policy and call-off procedure such as how and when employees must call off work.  Require a medical certification for certain medical related absences.  Set procedures, such as shutting off computer access, to ensure that when non-exempt employees are off work due to an illness or leave that they are not working from home.
Six Steps Necessary To Protect Your Intellectual Property

Through proper planning, companies can mitigate the risk of losing control over their copyrights, patents, and trade secrets.
  1. Provide Clear Guidelines:   Define the circumstances in which an employee can work from home, what facilities/equipment they can or cannot use, and if using their own home computers – the how, when, and why to log into the office system.
  2. Require an Intellectual Property Agreement:  Have key employees execute intellectual property ownership/assignment agreements to confirm company ownership.
  3. Avoid Disclosure of Trade Secrets: This plan should include: (a) creating an inventory of what information the company wants to keep secret and confidential; (b) developing a matrix classifying who gets access to which secrets and how much access the employee gets; (c) determining which trade secrets can be digitalized and which are to remain in hard copy never to leave the office; (d) developing a written trade secret policy to be included in any agreements; (e) getting employees to sign non-disclosure agreements; and (f) designating a corporate security officer to oversee compliance.
  4. Create a Plan for Departing Employees:  Cut off computer access before terminating an employee and create a record during the exit interview of a departing employee’s adherence to company policy that includes a signed statement that the employee has abided by the company’s trade secret policies, has not retained trade secret information, has not and will not take any trade secret information with them.
  5. Legal Fee Provisions:  Shift the burden to pay the company’s attorneys fees and costs in connection with any lawsuit for violations of the company’s trade secret policies onto the employee.
  6. Liquidated Damages:  Damages from the theft of trade secrets are often hard to calculate.  Thus, as another way to discourage theft, companies should consider including liquidated damage provisions in its employment agreements  which establish fixed damages as a reasonable royalty for use of trade secrets.