Flexible work arrangements are becoming increasingly popular among employers and employees. As Millennials begin to take over the workforce, employers will see that more and more employees will be asking for this benefit. There are many types of flexible work arrangements. Most often people think of telecommuting, or working from home. That is certainly a popular form of flexible work, but there are many more. Perhaps one employee would do better working four 10 hour shifts while an earlier (or later) start time best for another employee. Among the concerns many employers have when considering implementing flexible work arrangements, particular remote work is compliance with wage and hour laws. This is a valid concern and one that should be taken very seriously, particularly for non-exempt employees. This is likely to become even more important as new overtime rules expected to take effect later this year will mean that a number of white-collar workers will no longer be considered exempt from overtime.
A recent article from the Harvard Business Review gives some great advice for managing this situation.
Establish clear work-time guidelines: A flexible work arrangement does not mean that there are not guidelines as to when the employee should be working. Make it clear to employees what working time and non-working time looks like. The FLSA can provide a good guideline for this. Also outline what types of breaks in working time are appropriate. Clearly state that all overtime must be approved by a supervisor. As a reminder, these are things you should be doing for all employees, even those with traditional work arrangements and particularly those that are non-exempt.
Record all hours worked: Employers are required by federal law to keep a record of all of the hours worked by employees going back at least three years and your state and local laws may require more. If you use a timekeeping system (such as the A Plus Benefits TimeClock), make sure your remote employees can access that. If you use another system, make sure that remote employees have access to record their hours, or develop a spreadsheet or other mechanism for them to report their working time. Once again, this should be done for all employees, not just remote workers.
Consider when to compensate remote workers for travel time: Travel time can be a tricky wage and hour law to navigate and remote workers make this even more difficult. An employee traveling from their home to work and back again each day does not have to be paid for the time commuting, according to the FLSA. But what about a remote worker who starts their day at home, but then travels to the office for a meeting? The safest things to do in this case would be to pay the employee for that travel time, because typically for non-exempt employees, travel that occurs in the middle of the work day (crosses their normal working hours) is considered compensable time (must be paid and counts toward overtime). Make sure any of your non-exempt remote employees understand your expectations of starting their work day at home and then traveling to the office (or vice versa). If you have employees with a particular long commute, you may want to avoid these types of situations mall together to eliminate that extra cost.
Consider when to reimburse teleworkers’ expenses: Some employees who work from home may need to be paid for the use of their phone, computer or internet work purposes, particularly if the costs of those resources would push the employee’s pay below minimum wage. Here are some best practices:
- Give employees who telecommute (even just occasionally) laptops instead of desktops so they have access to a company computer at all time and never have to use their own equipment.
- You can provide these employees with a cell phone or use free internet phone services like the one through Google to avoid additional costs for a home phone line.
- If you require an employee to work from home or if working from home is a reasonable accommodation for the employee Americans with Disabilities Act, employers need to reimburse them for all necessary expenses related to performing work at home.
- Even if work at home is optional, employers need to consider if the employee paying for phone, internet, computer etc. would cause them to earn less than minimum wage, and if so, must cover that cost.
Flexible work arrangements can be a win-win for employees and organizations, but it is important that organizations understand what some of the legal impact may be of having employees who occasionally or always work at a location away from the office. Rest assured, there are definitely more benefits than risks in most cases and a well-structured flexible work arrangement can cause little to no extra liability for the company.
As with all legal compliance issues, if you have concerns, we recommend you contact an employment law professional. Our HR advisors at A Plus Benefits can also assist you in making sure your flexible work arrangements are not creating any unnecessary extra liability.