Seyfarth Synopsis: Although the concept of working remotely may seem simple, employers must consider several issues before allowing employees to work from home.

There's No Place Like Home

Today's technology allows many employees to work nearly as well in their pajamas at home or in their jeans at a local coffee shop as they can dressed up at the office. While this arrangement may not be viable for every employer, allowing employees to work from home or other locations of their choosing has enabled employers to reduce overhead expenses while boosting employee morale. But before employers allow their employees to be homebodies, there are several issues to consider.

Does A Trip To The Fridge And Back Count As A Break?

Tracking non-exempt employees' time on the clock becomes increasingly more difficult if they work remotely, since their supervisors obviously cannot consistently see when work is being performed. Nonetheless, California law requires employers to maintain records of non-exempt employees' work hours, and pay them overtime premium wages for any hours worked over eight in one day, over forty in one week, or any hours on a seventh consecutive day during a workweek. Under Labor Code section 226.7, employers must also pay an extra hour of pay each day in which they fail to provide a meal or rest period. This law applies regardless of where the employee works.

Thankfully, there are some software programs and apps available that ease the burden of keeping track of remote non-exempt employees and their time worked. Nonetheless, an employer must still encourage employees to take their meal and rest breaks in accordance with the company's legally compliant meal and rest break policy that applies to all non-exempt workers.

Are My Bunny Slippers A Reimbursable Business Expense?

Labor Code section 2802 requires employers to reimburse employees for expenses "necessarily incurred" in their employment. An employer generally complies with section 2802 by either reimbursing a given expense or providing the employee with the equipment necessary to ensure that the employee does not incur the expense in the first place. For instance, employees who use a personal cell phone to make work-related calls should be reimbursed for at least a percentage of their cell phone bill, though it can be tricky to determine what percentage of calls were necessary for work and what percentage were personal calls unrelated to work.

When it comes to remote workers, the most important inquiry is whether the expense was necessary for the work. The best way to avoid any ambiguity is to either (1) provide employees with all equipment the employer deems necessary or (2) have a policy that outlines which expenses are reimbursable and to what extent, and makes clear that if the employee incurs necessary business expenses beyond those anticipated, those expenses should be submitted in accordance with the company's business expense reimbursement policy. (You may choose to reimburse for bunny slippers if you wish.)

What Happens If I Step On a Lego?

Accidents happen while working, and they can just as easily occur at a home office or remote working location. According to the Occupational Safety and Health Administration (OSHA), small business owners are responsible for providing employees with safe work environments. And while OSHA generally doesn't inspect home offices as it does with traditional workplaces, employers must still track work-related injuries that occur with remote workers. Additionally, any California business with one or more employees must carry worker's compensation insurance. There is no exception to this requirement for employees who work remotely.

Labor Code section 3600 states that an employer is liable "for any injury sustained by his or her employees arising out of and in the course of the employment." Liability for an injury sustained by an employee while working at home is no different than if the employee had sustained the injury while working in the corporate office. And in one case, a court found that an employee was entitled to workers' compensation benefits when he sustained injuries trimming his hedges while on call.

Employers should be cognizant of this potential risk and have policies in place that ensure, to the extent possible, that an employee's workspace is free from potential hazards, including loose Legos and hedge trimmers.

What Is An Employer To Do?

When allowing employees to work from home, employers should have a comprehensive telecommuting policy. To head off frequently asked questions, the telecommuting policy should cover the following areas:

  • The policy should provide that employees are entitled and expected to take their uninterrupted, off-duty meal and rest breaks, and require employees to certify that (1) their time records are correct and (2) their breaks were provided in accordance with company policy. The policy should also require employees to seek and obtain management's approval before working overtime, and make clear that failing to do so could result in disciplinary action.
  • Business Expenses. The policy should clearly delineate which expenses are reimbursable, but also provide an avenue for employees to submit reimbursement requests for additional necessary business expenses, even if those expenses are not delineated in the policy. If an employee is using a personal device for business activities, employers should consider how much the employee will be using that device for work purposes, and reimburse the employee accordingly.
  • Office Safety. To help prevent injuries, employers should require employees to keep their remote work areas free from obstructions and hazards. Employers may also consider asking their employees to submit pictures of their remote work spaces, offering ergonomic consultations (at the employer's expense) for employees' home offices, or sending out a company representative to ensure the employee is working in a safe environment.

Workplace Solutions. Because the laws affecting telecommuting are constantly evolving, employers should be deliberate when enacting a telecommuting policy and continually revisit it to ensure it is legally compliant. We will continue to monitor developments in this area and update our readers. In the meantime, if you have any questions, please contact your favorite Seyfarth attorney.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.