Keeping Track of Telecommuters

Fuel prices are unpredictable, and companies need to cut overhead. It appears there is no better time to encourage telecommuting. However, there is a downside: When people work from home, managers get suspicious. What if the telecommuter is slacking off?

The suspicious employer could turn to remote monitoring technology, but that solution is both boon and bane. Certainly, businesses can watch workers down to actual keystrokes and even literally keep eyes on them via Webcams. By doing so, however, the corporation can overstep bounds, open itself to lawsuits, antagonize workers, and turn contractors into full-time employees, whether they want to or not.

The Trouble with Monitoring

In fact, issues quickly stack up when monitoring employees. Neglect to tell them about the surveillance, and you expose yourself to lawsuits. Say that you will monitor them, and you potentially create offense and resentment because you are inferring they are not trustworthy. Overstep the bounds of your monitoring guidelines, and you could end up tracking what a non-employee family member is doing; again you become vulnerable to lawsuits.

The first inclination might be to avoid the issue completely ' but that is unworkable, too. The key is to find a balance between workable policies and keeping telecommuters happy and productive.

“There are lots of justifications employers use to monitor employee Internet/e-mail use ' slacking off and prevention of workplace harassment being the most common,” said Joshua King, general counsel of Avvo, and a former general counsel of Cellular One. “For the most part, these concerns are misplaced.” Mr. King thinks that sensible policies and a focus on what is really important ' productive time ' are what companies really need. “It's the same old command-and-control, nanny mentality that embitters mediocre employees and makes the good ones flee to more empowering environments,” he said.

It's Not So Easy

Depending on the business model, however, such advice may not be so easy to follow. Even if managers are willing to give up monitoring, there are other considerations. Employees may be non-exempt, particularly if an operation like a sophisticated call center uses home-based workers. Because non-exempt employees are entitled to overtime, employers must be careful to track their hours.

Complicating the need is that many companies mistakenly classify the categories of exempt and non-exempt workers, putting wage earners into salaried positions. Some labor lawyers opine that proper classification of employees is the major issue under the Fair Labor Standards Act (FLSA). Because the FLSA requires compensation for all work that the employer “knew or should have known was being performed for its benefit,” the company could suddenly face a whopping overtime bill.

A Google search of “FLSA class action” would illustrate that every large employer ' from Apple, Inc. to Wal-Mart Stores, Inc. ' is or has been involved in FLSA litigation. Even having a written policy forbidding overtime without monitoring infractions and disciplining employees who break the rule is no help.

Second Circuit Case

Last year in Chao v. Gotham Registry Inc., No. 06-2432-cv (2nd Cir. Jan. 24, 2008), employees sued a nurse staffing agency for overtime pay, although a written policy prohibited overtime hours, even if requested by a client, unless specifically authorized by Gotham Registry Inc. The Second U.S. Circuit Court of Appeals highlighted this strict requirement by ruling that an employer was required to pay employees for unauthorized overtime, despite the existence of a policy prohibiting employees from performing such after-hours work.Unless you are positive that no one working at home could possibly be mistakenly classified, it might be smart to monitor hours just in case.

Written policies, however, can only go so far. The minute employees check an e-mail from a supervisor or answer a message on a BlackBerry, it means they are basically working from home. Such activity can fall through the most carefully constructed program intended to monitor regular and anticipated home work.

A different issue arises when monitoring contract or temporary workers. It becomes a slippery slope. According to Stephen Fox, a partner at Fish & Richardson, it begins to appear like the employer is treating the individual more like an employee than an independent contractor, because the employer is beginning to exert control over the contractor's workday. In and of itself, simply monitoring the contractor's hours is not fatal to maintaining the employer-independent contractor relationship. However, when does monitoring become controlling? The best policy in such cases is not to monitor at all. An employer should not be concerned with how an independent contractor spends his/her time. An employer's only concern should be the contractor's ultimate output.

Before companies decide on monitoring, they should consider what it entails. To avoid potential privacy issues, David Walton of Cozen O'Connor suggested buying a computer for any employee working at home. If the employer purchases the computer, there is no reasonable expectation of privacy and the employee is not entitled to use the computer for personal reasons.

The next consideration is how to carry out the monitoring. The employer could load keystroke monitors and other spyware-like packages onto the home computer, but that means that someone is going to have to wade through tons of data. Instead, the best procedure is to set up a Web portal allowing employees to log in for access to software and data, allowing the employer to track the hours of use. It also provides some protection for the data to which the employees will have access.

For some of the more extreme versions of monitoring, like Webcams, discretion may be the better part of protection. It is important that an employer think through which technology is best for each circumstance.

Conclusion

By restricting telecommuting to the people who really need to work at home and then asking them to sign a form indicating that they know the types of monitoring in use, a company can take reasonable protections without entering an Orwellian environment ' and making life hell for managers.

Erik Sherman is a Colrain, MA-based writer who writes frequently on law and technology. This article first appeared in The Corporate Counsel, an Incisive Media sister publication of this newsletter.

Fuel prices are unpredictable, and companies need to cut overhead. It appears there is no better time to encourage telecommuting. However, there is a downside: When people work from home, managers get suspicious. What if the telecommuter is slacking off?

The suspicious employer could turn to remote monitoring technology, but that solution is both boon and bane. Certainly, businesses can watch workers down to actual keystrokes and even literally keep eyes on them via Webcams. By doing so, however, the corporation can overstep bounds, open itself to lawsuits, antagonize workers, and turn contractors into full-time employees, whether they want to or not.

The Trouble with Monitoring

In fact, issues quickly stack up when monitoring employees. Neglect to tell them about the surveillance, and you expose yourself to lawsuits. Say that you will monitor them, and you potentially create offense and resentment because you are inferring they are not trustworthy. Overstep the bounds of your monitoring guidelines, and you could end up tracking what a non-employee family member is doing; again you become vulnerable to lawsuits.

The first inclination might be to avoid the issue completely ' but that is unworkable, too. The key is to find a balance between workable policies and keeping telecommuters happy and productive.

“There are lots of justifications employers use to monitor employee Internet/e-mail use ' slacking off and prevention of workplace harassment being the most common,” said Joshua King, general counsel of Avvo, and a former general counsel of Cellular One. “For the most part, these concerns are misplaced.” Mr. King thinks that sensible policies and a focus on what is really important ' productive time ' are what companies really need. “It's the same old command-and-control, nanny mentality that embitters mediocre employees and makes the good ones flee to more empowering environments,” he said.

It's Not So Easy

Depending on the business model, however, such advice may not be so easy to follow. Even if managers are willing to give up monitoring, there are other considerations. Employees may be non-exempt, particularly if an operation like a sophisticated call center uses home-based workers. Because non-exempt employees are entitled to overtime, employers must be careful to track their hours.

Complicating the need is that many companies mistakenly classify the categories of exempt and non-exempt workers, putting wage earners into salaried positions. Some labor lawyers opine that proper classification of employees is the major issue under the Fair Labor Standards Act (FLSA). Because the FLSA requires compensation for all work that the employer “knew or should have known was being performed for its benefit,” the company could suddenly face a whopping overtime bill.

A Google search of “FLSA class action” would illustrate that every large employer ' from Apple, Inc. to Wal-Mart Stores, Inc. ' is or has been involved in FLSA litigation. Even having a written policy forbidding overtime without monitoring infractions and disciplining employees who break the rule is no help.

Second Circuit Case

Last year in Chao v. Gotham Registry Inc., No. 06-2432-cv (2nd Cir. Jan. 24, 2008), employees sued a nurse staffing agency for overtime pay, although a written policy prohibited overtime hours, even if requested by a client, unless specifically authorized by Gotham Registry Inc. The Second U.S. Circuit Court of Appeals highlighted this strict requirement by ruling that an employer was required to pay employees for unauthorized overtime, despite the existence of a policy prohibiting employees from performing such after-hours work.Unless you are positive that no one working at home could possibly be mistakenly classified, it might be smart to monitor hours just in case.

Written policies, however, can only go so far. The minute employees check an e-mail from a supervisor or answer a message on a BlackBerry, it means they are basically working from home. Such activity can fall through the most carefully constructed program intended to monitor regular and anticipated home work.

A different issue arises when monitoring contract or temporary workers. It becomes a slippery slope. According to Stephen Fox, a partner at Fish & Richardson, it begins to appear like the employer is treating the individual more like an employee than an independent contractor, because the employer is beginning to exert control over the contractor's workday. In and of itself, simply monitoring the contractor's hours is not fatal to maintaining the employer-independent contractor relationship. However, when does monitoring become controlling? The best policy in such cases is not to monitor at all. An employer should not be concerned with how an independent contractor spends his/her time. An employer's only concern should be the contractor's ultimate output.

Before companies decide on monitoring, they should consider what it entails. To avoid potential privacy issues, David Walton of Cozen O'Connor suggested buying a computer for any employee working at home. If the employer purchases the computer, there is no reasonable expectation of privacy and the employee is not entitled to use the computer for personal reasons.

The next consideration is how to carry out the monitoring. The employer could load keystroke monitors and other spyware-like packages onto the home computer, but that means that someone is going to have to wade through tons of data. Instead, the best procedure is to set up a Web portal allowing employees to log in for access to software and data, allowing the employer to track the hours of use. It also provides some protection for the data to which the employees will have access.

For some of the more extreme versions of monitoring, like Webcams, discretion may be the better part of protection. It is important that an employer think through which technology is best for each circumstance.

Conclusion

By restricting telecommuting to the people who really need to work at home and then asking them to sign a form indicating that they know the types of monitoring in use, a company can take reasonable protections without entering an Orwellian environment ' and making life hell for managers.

Erik Sherman is a Colrain, MA-based writer who writes frequently on law and technology. This article first appeared in The Corporate Counsel, an Incisive Media sister publication of this newsletter.