Working Remotely -- Is this Arrangement Right for Your Business?

In early March, Marissa Mayer, CEO of Yahoo!, Inc., made news when she announced the end of her company's policy to allow employees to work from home. Should you allow your staff to work remotely? Consider all of the ramifications.

What is telework?

It is an arrangement in which employees work from home on a regular basis. This isn't merely allowing them to take extra work home from the office at night; it's requiring them to do their job away from the office.

Currently, about 9.4% of the U.S. workforce works at least one day each week from home. Despite broadband and other technological developments of the past 25 years, this percentage is up only slightly over the 1997 level of 7% of workers. This may be because telework arrangements are not appropriate for every business.

Advantages of teleworking

Some compelling reasons to allow remote workers:

  • Geography is no longer a boundary to the best talent. You can hire the best workers possible because your workers can be from anywhere as long as their work can be done remotely.
  • Productivity can be enhanced. By eliminating time wasters at the office (e.g., idle chat around the water cooler; meetings that drag on), workers can spend their hours more productively on business matters. Also, the flexibility allows workers to do their job at times most suited to them (e.g., a morning person may start at 6 am, while a night owl may prefer to work past midnight).
  • Cost savings. You don't need space for workers who are remote, cutting your overhead.
  • Environmental considerations. Less commuting means a reduced impact on the environment by workers who would otherwise drive to and from your company.
  • Employee satisfaction. Many employees consider a telecommute option to be a benefit. This can help businesses attract and retain top talent.

Disadvantages of teleworking

Telework is not suitable for every type of business. Many companies encounter the following obstacles:

  • Supervision. It's not easy to stay on top of workers who are not physically in your location. It takes more effort to see that work is being done according to your specifications.
  • Insurance. The rules about insurance for teleworkers aren't clear. Work with your insurance agent to determine what workers' compensation and liability coverage is needed.
  • Taxes. Withholding of state income taxes (where required) can be complicated for workers who spend time in more than one state (e.g., working in the company's New Jersey office some of the time and from home in New York the rest of the time).
  • Tech issues. Remote workers typically log onto company servers. Be sure that firewalls and other protections are in place to avoid problems or security breaches and other issues that remote workers could inadvertently introduce into the servers.
  • Office politics. Remote workers may be out of the loop and miss developments going on in the office. Make sure that lines of communication are open to sharing important company information.


If you want to allow your staff to work remotely, take the time to develop procedures and best practices to ensure that expectations are clear and realistic. Formalize your telework arrangements and establish an overall company policy. Here are some sample plans to help you:


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