Telecommuting as a Benefit

With employees working harder than ever before, many say it’s becoming more difficult to find a balance between work and home life. If you want a low-cost way to improve job satisfaction and increase productivity, consider developing a telecommuting program.

Telecommuting: Meanings Vary

“Telecommuting” (also called “telework”) means any arrangement where an employee works at home or another location removed from the employer’s site. It can take a variety of forms, depending on the organization and employee’s position. Some arrangements allow employees flexibility of schedule as well as location. Some employees work full-time from home, while others work at home part-time and in the office part-time. Some employers have formal arrangements with telecommuting contracts or agreements, while others have ad hoc arrangements.

Benefits of Telecommuting

However your organization structures it, telecommuting offers advantages for employees and employers alike. In a survey of telecommuters conducted in May 2011 by Staples Advantage, the business-to-business division of the office supply superstore, the overwhelming majority — 86 percent — said they were more productive in their home office. Telecommuters also reported being:

• Happier and healthier — When asked to draw comparisons, telecommuters say their stress levels dropped 25 percent on average since working from home. Seventy-three percent even say they eat healthier when working from home.
  
  
• More loyal — Without the trek to the office — on average, a 75-mile round-trip for respondents — 76 percent of telecommuters are more willing to put in extra time on work and say they are more loyal to their company since telecommuting.
  
  
• Better balanced — More than 80 percent say they now maintain a better work/home life balance.

Other studies support these findings. In 2007, researchers at Pennsylvania State University reviewed nearly 50 studies on flexible scheduling, which spanned 20 years and involved nearly 13,000 employees. Dr. Ravi Gajendra, one of the co-authors, said, “Our results show that telecommuting has an overall beneficial effect because the arrangement provides employees with more control over how they do their work.”

Employers not only enjoy additional productivity and happier employees, they can also reduce costs with a well-planned telecommuting program. With more employees off-site, they can reduce their real estate needs and energy consumption. It has environmental benefits, too — when employees eliminate their commute they save gas and reduce pollutants.

As with nearly any benefit, telecommuting can be abused. In a survey by CareerBuilder, 17 percent of teleworkers admitted (anonymously, of course) to doing an hour or less of work during work hours. They admitted to allowing the following distractions to take their time:

• Household chores (31%)
• TV (26%)
• Pets (23%)
• Errands (19%)
• Internet (18%)
• Children (15%)

Other studies have found that employees who work away from the office for three or more days of the week reported their relationships with co-workers worsened. However, their managers reported that their performance did not suffer. Telecommuters can feel disconnected when they don’t have face time with their co-workers. Scheduling regular meetings to check-in—whether in-person, Skype or video conferencing—can help telecommuters stay in the loop.

The following pointers can help make telecommuting positive for both your organization and your employees:

• Keep your expectations clear. Telecommuters should have detailed job descriptions and specific work goals.
  
  
• Evaluate performance regularly.
  
  
• Don’t show favoritism when allowing employees to telecommute. Use objective criteria, such as job duties, to determine who can or cannot telecommute and when.
  
  
• Consider overtime liability. If job duties cause an employee to be classified as non-exempt under the Fair Labor Standards Act (FLSA), you must pay him/her for all hours worked, including overtime for any hours over 40 in a single workweek. To avoid liability for back pay and fines, establish a mechanism to track their actual work hours.
  
  
• Consider safety. Employers are liable for employees’ work-related injuries, even if they occur in the employee’s own home. You will want to ensure that employees have a safe work set-up. If your employee works in another state, make sure you have the necessary workers’ compensation coverage. Many employers also opt to carry employers liability insurance in addition to workers’ compensation insurance to provide additional coverage for lawsuits filed by employees or their families for injuries.
  
  
• Discuss potential state/municipal tax issues with your accountant. An employee who works out of state might have to pay state income taxes to the employer’s state, his/her state of residence or both, depending on state laws and the individual situation.

For information on other life/work benefits, please contact us. 

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In this issue:

This Just In...

Housekeeping for Retirement Plans

Wellness Programs: Why, What, Who and How

Telecommuting as a Benefit

Retirement Account Limits for 2012

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