Subscribe and download our eBook, "Innovative Ideas for Surviving a Recession and Avoiding Problems in Your Small Business."
Get the:

Remote Workers

Remote Workers: 3 Hidden Liability Issues for Employers to Consider

Remote WorkersAllowing employees to work from home is a win-win. From the company perspective, employees who telecommute are more productive (perhaps because they don’t have to commute to and from work, attend meetings, and hassle with office politics) and are more loyal to their employers.

Fundera reports that employers offering at least part-time telecommuting collectively save $44 billion annually because of reduced turnover, savings in rent (less space needed), and even inexpensive ADA compliance for workers with disabilities.

For employees, working from home offers the chance of a better work-life balance and the opportunity to work for companies not located near them. But the arrangement has some hidden liability issues that you need to address in order to make things work well. Here are 3 such issues to consider:

Accidents at home

What happens if an employee trips over a Barbie doll while on the clock? The company may be liable for the injury. A California court held that a firefighter who fell from a ladder while trimming his wisteria was eligible for workers compensation. He was on call 24 hours a day in order to respond to emergencies, so the injury was a result of the performance of his job.

What to do: It’s an employer’s responsibility to provide a safe work environment, even if the employee is off-site (it’s viewed under the law as part of an employer’s premises). There’s really no way to be assured that the employee’s home is safe (e.g., free from wires that he/she could trip on). Discussing the off-site work location (e.g., is it a separate room? sufficient space free from household activities?) may be the best that an employer can do.

Also understand that your workers’ compensation policy covers remote workers. They cannot be excluded from coverage merely because they work off-site. This policy should give you good protection. If there’s an injury, the employee will have to prove that it was work-related.

Data security

When an employee logs onto the company server, there is a potential for problems to arise. If, for example, there is a data breach through an employee’s personal computer linked to the company server or containing company data, there is potential liability for comprised information about employees and/or customers. This can lead to costly exposure for the company.

What to do: Be sure to implement a data security policy. This may include encryption to protect company data. There’s a good 10-step policy from Computerworld. And a helpful blog on how to effectively ensure cybersecurity for remote employees.

Also, be sure that your insurance covers cyber liability. You may need to add onto your existing policy or obtain a separate one for cyber liability.

Clocking in and out

There are two important issues about having remote workers on the clock, one of which is not a question of liability. You want to be sure that they’re spending their time on company business per their arrangement with you. They’ve logged on, but are they then doing work for the company?

The second issue, which involves liability, is if your remote employee is not an exempt employee, then you are required to pay time-and-a-half when he/she works more than 40 hours during the work week. If you don’t, you’ve violated the federal Fair Labor Standards Act (FSLA) and likely state-level labor law rules. So hours worked by a remote employee must be carefully documented

What to do: Set deadlines for work to be completed by remote workers. Maintain daily communication with them by phone, email, and/or text (without causing too much disruption in their work).

Also, make sure that remote workers precisely track the hours they work. This can be done, for example, by logging onto/off of the company server. Just be sure that the person doing the logging is, in fact, the employee and not someone acting on the employee’s behalf. Be sure to account for “hours worked,” factoring in rest and meal periods, etc. The DOL defines this in a fact sheet.

Final thought

When crafting a telework policy, watch for these and other liability issues for the company. Review your insurance coverage and discuss concerns with an employment law attorney.