C. W. Von Bergen, William (Will) T. Mawer, and Edward Hobbs



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Legal and Policy Considerations in Telework
C. W. Von Bergen, William (Will) T. Mawer, and Edward Hobbs

(sequence of authorship has not been decided)

Southeastern Oklahoma State University

Legal and Policy Considerations in Telework

Abstract

More and more employees are working outside of traditional on-site work environments in locations tied electronically to a central office. This telework or telecommuting practice has become an increasingly important employment tool, fulfilling key business needs while helping employees balance their work and personal commitments. Using the flexibility to work in a location other than ones official duty station when it is effective to do so is clearly the wave of the future, and for many employees and organizations the future is clearly here. As this telework trend grows, legal and policy issues surrounding this popular working arrangement have multiplied. This paper examines a number of key legal and policy factors employers should review before implementing telecommuting.

Legal and Policy Considerations in Telework

A teleworker, working on a company laptop in his


living room, takes a coffee break and goes to the

kitchen to make a peanut-butter sandwich. On his

way back to the work area, he trips and injures his

head on the laptop. Who is responsible for the injury?

While this may be a far-fetched scenario, in the real world of telework or telecommuting (the terms are used interchangeably) wacky things occur, and it would behoove organizations to consider adequately a number of issues before they hand their workers a laptop computer and a password to access the corporate network off-premises. This paper addresses legal and policy matters surrounding telework. It begins with a discussion of telework and its popularity, where telework occurs, key legal factors in telecommuting, and concludes with telecommuting policy considerations.

Introduction

Over the years, a variety of work structures have emerged and been considered by employers in an ef­fort to attract and retain qualified workers while minimizing rising employee costs.1 Additionally, due to shifting workplace demographics, organizations are examining various strategies to accommodate workers from two-income families, single-parent households, and employees taking care of younger and older relatives.2 Furthermore, as the manufacturing sector of the economy discarded jobs, the services sector was adding them.3 Manufacturing businesses traditionally house their operations at a “central office” site where employees are expected to report for work. While most service businesses also use their operations at a specified location, the need for employers to work at this central office is not nearly so obvious.4 Indeed, the technology that allows serv­ice businesses such as banks, insurance companies, accounting firms, and retail establishments to work—email, fax machines, cellular phones, and laptop com­puters—also permits employees to com­municate with customers and co-workers from any number of locations. Lastly, a recent set of enforcement guidelines published by the Equal Employment Opportunity Commission (EEOC) strongly encourages employers to consider flexible work arrangements for their workers in order to achieve greater work-family balance, particularly for individuals having caregiving and family responsibilities.5 Thus, a number of factors including strategies designed to attract and retain valued employees, programs intended to meet the varied needs of a diverse workforce, a changing economic base, and regulatory pressures, demand consideration of alternative working arrangements. Not surprisingly, numerous practices that provide the flexibility needed by today’s workers and organizations have gained popularity in recent years.6 One such activity involves telework or telecommuting and is the topic addressed in this paper.


Telework

Telecommuting is not new, but it has never been more popular. Today’s technology makes it easier to implement than in previous years, while today’s economic and social realities make it more attractive. With portable computers, high speed telecommunications links, and ever-present pocket communications devices, many employees today can work almost anywhere at least some of the time and no longer have to meet at their “official duty station” to conduct business. Instead, they can work in cyberspace just as effectively as if they were sitting next to their co-workers and, with advances in videoconferencing, teleworkers can feel particularly connected.7

Telework is the practice of using computer-based communications technology so as to enable work to be performed outside the conventional workplace from remote locations, such as the home, a ship, a hotel room, or anywhere an Internet connection can be made.8

To be considered telework, it must generally occur at least one day per week on a regular and recurring basis and does not include (1) situational telework (unscheduled, project-oriented, non- recurring, and/or irregular telework and/or any teleworking that occurs less frequently than once a week on a recurring basis) or (2) full-time mobile work arrangements.9


Growth of Telework

Years ago, telecommuting was used mostly by sales representatives and consultants, but today it is used regularly by many employees, such as researchers, attorneys, university professors, and people in a variety of cre­ative positions (e.g., artists, photographers, and writers). The typical telecommuter is a middle-aged, college-educated, white male who owns a home computer and earns at least $40,000 per year10 and while some individuals telecommute on a full time basis, most work at home for one or two days a week.11 In recent years, telework has grown in popularity from an interesting, out-of-the ordinary possibility for some people to a main­stream reality for many. Research suggests that the federal government has been more receptive to telework than has the private sector.12

Recent data available from the U.S. Government (calendar year 2005) found that there were 119, 248 employees teleworking in the Federal Government and that over 70,000 or 60 percent of these employees teleworked with a high frequency of at least one or more days per week.13 The Society for Human Resource Management’s 2007 benefits survey indicated that 56% of the 590 U.S. companies surveyed are offering some form of telecommuting in 2007, up from the 51% that did so in 2006.14 According to the survey, 21% of companies let at least some workers telecommute full time, up from 19% in 2006; 33% let some employees work from home on a part-time basis, up from 26%; and 48% say they allow telecommuting on an ad hoc basis, up from 45%. Other data indicate that more than 12 million Americans now telecommute full-time, according to the Dieringer Research Group, which recently surveyed the trend for the International Telework Association & Council. Another 10 million telecommute at least one day a week. Combined, the ranks of these telecommuters have risen 10 percent since 2004.15 Similarly, 22.2 million Americans worked from home or another out-of-office location at least one day per week in 2005.16


Telework Locations

A 2005 survey found that some 45.1 million Americans use broadband connections from various places to do work that they otherwise would have done in an office.17 As shown in Figure 1, there are a wide variety of locations in popular use. Many people rely on more than just one, an average of 3.4 loca­tions, in fact.18 For many, their local Starbucks represents “the third space” beyond office and home, wherever a notebook computer, a wireless network, and a latte may be found. But, with a 60 percent increase in the availability of broadband connections in people’s homes, the home is the fastest-growing location.19

Figure 1. From where do people telecommute?20


Benefits and Limitations of Telework

Both employees and employers enjoy the benefits of telework. For example, telework makes it possible for employees to avoid the hassle and expenses of daily commuting, which, in an era of congested roads and expensive fuel costs, can be dramatic. Employees working at home also enjoy saving money that they would have spent purchas­ing work clothing and buy­ing meals in restaurants and from vending machines. In fact, it has been estimated that in 2005 each teleworker was able to save approximately $20,000 per year, taking into account all expenses.21 Saving money is not the only reason why most telecommuters like the arrangement. They also enjoy the flexibility it gives them to balance work and family mat­ters.22 For example, over 83 percent of the 4,000 employees at IBM’s Midwest Division indicated that they are not interested in returning to the traditional office environment. Other findings showed that employees choose telecommuting to decrease work-related stress, to work longer hours but in more comfortable environments, and to provide uninterrupted time to focus on their work.23

Telecommuting also makes it possible for companies to save millions of dollars in expenses for office facilities.24 At Hewlett-Packard, for example, about $230 million is being saved in annual office expenses. This occurs because companies are able to get more work done in the same space. Cisco Systems, for example, has so many teleworkers that it now takes only the physical space of 88 workers to do the work of 140 employees.25 IBM also has been able to slash its office space by as much as 55 percent in some locations. As one might imagine, the savings are particularly important to small, start-up companies, which can hire workforces without having to make large investments in office space. Other data indicate that organizations adopt telecommuting, not only to save real estate costs but also as an attempt to improve employee morale and productivity, reduce absenteeism, and attract workers who might not otherwise be available.26

Importantly, telework allows companies to comply with governmental regula­tions (e.g., the Federal Clean Air Act of 199027) requiring them to reduce the number of trips made by their employees. In fact, the federal government is a major proponent of telework.28 For example, in October 2000, Congress passed the Department of Transportation appropriation bill,29 which included a provision requiring every federal agency to allow eligible employees to telework to the maximum extent possible without diminished performance. The Office of Personnel Management and the General Services Administration have summarized a number of other telework laws for federal agencies.30

A particularly interesting and all-too-real reason to use telecommuting is to help businesses organize after a disaster strikes. After all, if an organization’s assets are spread out—as is the case if they are in the hands of employees who are geographically dispersed—they are less vulnerable to attacks by human threats (e.g., terrorist strikes, arsonists) and natural disasters (e.g., floods, hurricanes, and tornadoes).31

Despite these benefits, telecommuting is not for everyone; it also has its limitations.32 Many people simply do not have the kind of self-discipline needed to get work done without direct supervision.33 Critics argue that telecommuting arrangements are fraught with pitfalls, including em­ployee isolation, lower productivity, and reduced teamwork and camaraderie.34 It works best on jobs that require concentration, have well-defined begin­ning and end points, are easily portable, call for minimal amounts of special equipment, and can be done with little supervision.35 According to a U.S. Department of Labor study telecommuting works best for jobs that demand a high degree of privacy and concentration, are predictable, and information-based.36 In summary, telecommuting is an increasingly popular work alternative that can take place in a number of locations and has a number of benefits for workers and organizations. Telework also has some limitations and to make it more effective it requires careful adjustments in the way work is structured, especially as these relate to important policy and legal considerations as discussed in the following section.


Key Policy and Legal Considerations

With the advancement of technological innovations and a changing workforce, the practice of telecommuting will continue to grow and flourish. While telecommuting programs offer attractive alternatives to traditional work locations, they present legal challenges to employers because telework challenges traditional ideas of how work is structured. Not surprisingly, this phenomenon creates a host of problems for both courts and employers, who must reconcile the new telecommuting paradigm with employment laws that date back to the days of industrial factories. Foremost among these legal considerations are worker health and safety concerns, employment and labor issues, and implications for state and federal taxes. These were selected because of the broad impact such factors have on organizational performance and liability.


Worker Safety and Health Issues

The purpose of the Occupational Safety and Health Act of 1970 (OSH Act) is to “assure so far as possible every working man and woman in the Nation safe and healthful working conditions”….37 It requires these employers to provide employment and a place of employment that are free from recognized, serious hazards, and to comply with OSHA standards and regulations. 38 In order to fulfill their OSHA obligations, CSC Credit Services in August 1997 advised OSHA that it was about to require its sales executives to begin telecommuting from home. The sales executives were expected to work from a single room in their homes, using a desk, chair, file cabinet, telephone, computer, printer and facsimile machine. CSC asked OSHA to provide advice as to the nature and extent of the company’s responsibilities under the OSH Act with respect to these home-based sales executives. Two years after having received CSC’s inquiry, OSHA’s Directorate of Compliance Programs issued a letter of interpretation letter.39 In that opinion, OSHA affirmed its position that the OSH Act applied to home-based workers and that employers ultimately were responsible for ensuring safe and healthful home offices.

An uproar followed regarding invasion of privacy and compliance issues that led the agency to rescind the letter just two months later. After the public outrage, OSHA issued a directive that set out the following major points on employers’ responsibilities regarding work performed at home:40


Policies for Home Offices41

1) OSHA will not conduct inspections of employees’ home offices;

2) OSHA will not hold employers liable for employees’ home offices, and does not

expect employers to inspect the home offices of their employees;

3) If OSHA receives a complaint about a home office, the complainant will be advised of

OSHA’s policy. If an employee makes a specific request, OSHA may informally let

employers know of complaints about home office conditions, but will not follow-up

with the employer or employee.



Policies for Other Home-Based Worksites42

4) OSHA will only conduct inspections of other home-based worksites, such as home

manufacturing operations, when OSHA receives a complaint or referral that indicates

that a violation of a safety or health standard exists that threatens physical harm, or

that an imminent danger exists, including reports of a work-related fatality;

5) The scope of the inspection in an employee’s home will be limited to the employee’s

work activities. The OSH Act does not apply to an employee’s house or furnishings;

6) Employers are responsible in home worksites for hazards caused by materials,

equipment, or work processes which the employer provides or requires to be used in an

employee’s home;

7) If a complaint or referral is received about hazards at an employee's home-based

worksite, the policies and procedures for conducting inspections and responding to

complaints as stated in OSHA Instruction CPL 2.103 and OSHA Instruction CPL

2.115, will be followed.


Other Requirements43

8) Employers who are required by the OSH Act to keep records of work-related injuries

and illnesses will continue to be responsible for keeping such records as long as they

are work-related, however telecommuter’s homes are not considered “business

establishments” for which separate injury/illness records must be kept. Rather,

employees “who telecommute must be linked to one of” the business’s

“establishments” for which records are maintained.44

In summary OSHA indicated that employers are not responsible for white-collar telecommuters, but they may be for home-based blue-collar employees engaged in manufacturing or other hazardous home-based work. However, the regulations implementing the act provide that not every accident that occurs at a home work site is necessarily considered work-related. Specifically, the regulations say that injuries “and illnesses that occur while an employee is working at home…will be considered work-related if the injury or illness occurs while the employee is performing work for pay or compensation in the home, and the injury or illness is directly related to the performance of work rather than to the general home environment or setting.”45 Hence, if “an employee drops a box of work documents and injures his or her foot, the case is considered work-related. [However, if] an employee is injured because he or she trips on the family dog while rushing to answer a work phone call, [or if he or she] is electrocuted because of faulty home wiring, the injury is not considered work-related.46

Finally, employers should re­main concerned about telecommuter safety because of state “OSHA plans.” These are fed­erally approved plans for the development and enforcement of occupational safety and health standards. States may include in these plans more stringent standards than federal law imposes.47 Although “[m]ost states adopt standards identical to federal ones,”48 and although some have excluded private residences from safety inspection requirements,49 other states could choose to require employers to over­see the safety of home work sites.50

Workers’ compensation


Another reason employers should re­main concerned about telecommuter safety and health stems from workers’ compensation concerns and while working at home can create ambiguities in this issue, the application of existing doctrines can resolve such claims satisfactorily. Telecommuting is analogous to existing case law involving traditional employees in that the nature of the work is the same in both situations. In addition, an agency relationship continues to exist between the employer and employee. The major difference afforded by telecommuting is the location at which the work is being performed and that the hours being worked are not necessarily fixed to a “traditional” time schedule. Three key areas to be examined here involve workers’ compensation involving injuries at home, injuries while traveling to or from home, and injuries occurring while out of state.51

OSHA’s regulation of safety conditions in the home seems firm. The balancing of an employee’s right to privacy with the employer’s duty of ensuring compliance may be somewhat difficult. In addition, OSHA places an affirmative duty upon the employer to correct those hazards the employer “is or should be aware of.” Replacing faulty computers is easy; replacing faulty wiring or unsafe stairs leading to the employee’s office is not.

OSHA’s warning of liability and workers’ compensation concerns should, at the very least, require employers to take pause before implementing any type of telecommuting arrangement.

Telecommuting presents unique challenges to safety and health—most of which have been anticipated for years. In 1984, in The Office Environment: Automation's Impact on Tomorrow's Workplace, Wilbert Galitz, estimated that 50 percent of the office workers of the future could be telecommuters. The chapter, "Toward the Year 2000," describes ergonomics/ human factors, fatigue, social isolation and stress as critical concerns. This was an early hint of the challenges to come. Recent studies related to occupational safety and health indicate that although telecommuters report higher levels of job satisfaction, they have a lower level of awareness and knowledge concerning ergonomic and safety issues (Healy, 2000).

Wilbert O. Galitz (1984). The Office Environment: Automation's Impact on Tomorrow’s Workplace. New York: American Management Society Foundation.

Merrie L. Healy. (2000). Telecommuting: Occupational Health Considerations for Employee Health and Safety. 48 American Association of Occupational Health Nurses Journal, 305-314.

Michelle M. Robertson, Wayne S Maynard, Jamie R McDevitt. (2003). Telecommuting: Managing the safety of workers in home office environments. 48 Professional Safety, 30-36.

The telecommuter arrangement presents unique legal complications under state worker's compensation laws, including (1) whether any injury at home arose out of and in the course of employment; (2) the extent of the employer's duty and opportunity to insure workplace safety; and (3) the opportunity for employee fraud.

A. Injuries Arising Out Of And In The Course Of Employment

A majority of states provide for employer liability under workers' compensation wherever the injury occurs, provided that the injury arose out of or is related to employment and that the injury occurred in the course of employment. See, e.g., Pennsylvania Workers' Compensation Act, 77 Pa. C.S.A. § 411. Under Georgia's worker's compensation laws, "in the course of employment" refers to the time, place, and circumstances under which an accident occurred. O.C.G.A. § 34-9-1(4). An accident "arises in the course of employment" within the meaning of this law when it occurs (1) within the period of employment; (2) at a place where the employee reasonably would be in the performance of the employee duties; (3) while the employee was fulfilling employee duties, or is engaged in an activity incidental to fulfilling employee's duties. See, e.g., Sands v. Union Camp Corp., 559 F.2d 1345 (5th Cir. 1977). Because Georgia follows the "positional risk" doctrine, the employee need only prove that the employer brought the employee within the range of danger by requiring his or her presence in a location where the injury occurred. See, e.g., National Fire Ins. Co. v. Edwards, 152 Ga. App. 566, 263 S.E.2d 455 (1979). When an employee deviates from the course of his or her employment and is engaged in solely personal activity at the same of the accident, the injury is not one arising out of and in the course of his or her employment. See, e.g., General Accident Fire & Life Assur. Corp. v. Prescott, 80 Ga. App. 421, 56 S.E.2d 137 (1949).

Telecommuting employees working out of their homes do not benefit from the same presumption that an injury occurring in the office, factory, or facility occurred in the course of employment, rather than on a personal frolic. The test for whether or not an employee breaks the continuity of employment for personal purposes is as follows: (1) If the injury occurred before the employee returned to the line of employment, the injury is not one arising out of the course of employment; but (2) where the personal mission has been accomplished and the employee has reengaged in the duties of his or her employment, the injury arose out of or in the course of employment and is therefore compensable under Georgia law. See, e.g., Fulton County Civ. Ct. v. Elzey, 101 Ga. App. 520, 114 S.E.2d 314 (1960).

B. Employer's Duty To Provide A Safe Workplace

The Georgia rules requiring an employer to provide a safe workplace for its employees derives from O.C.G.A. § 51-3-1, which codifies the general law that an owner or occupier of land has a duty to invitees. See, e.g., Clark v. Carla Gay Dress Co., 178 Ga. App. 157, 159, 342 S.E.2d 468 (1968). Georgia courts have applied § 51-3-1 in negligence actions brought by employees against their employers. E.g., Smith v. Ammons, 228 Ga. 855, 188 S.E.2d 866 (1972). Since § 51-3-1 is derived from ancient law on duty to invitees, it is not surprising that this laws usually applied to permanent places such as factories, stores, and offices. Thus, it is unclear whether and to what extent § 51-3-1 applies to telecommuters working from their homes.

Another Georgia safe workplace statute, O.C.G.A. § 34-7-20, provides: "If there are latent defects in machinery or danger incident to an employment, which defects or dangers the employer knows or ought to know but which are unknown to the employee, then the employer shall give the employee warning with respect thereto." The statute is qualified by O.C.G.A. § 34-7-23, which provides as follows:

An employee assumes the ordinary risks of his employment and is bound to exercise his own skill and diligence to protect himself. In actions for injuries arising from the negligence of the employer in failing to comply with the duties imposed by Code Section § 34-7-20, in order that the employee may recover it must appear that the employer knew or ought to have known of . . . the defects or danger in the machinery supplied; and it must also appear that the employee injured did not know and had no equal means of knowing such fact and by the exercise of ordinary care could not have known thereof.

The employer's duty to furnish and maintain a reasonably safe place to work is that of ordinary care, and the employer is not required to be an "absolute guarantor of a physical or emotionally safe workplace" or to insure an employee's safety. See, e.g., Dugger v. Miller Brewing Co., 199 Ga. App. 850, 406 S.E.2d 484 (1991); Cline v. McLeod, 180 Ga. App. 286, 293, 349 S.E.2d 232 (1986). Georgia courts have found that where an employer could discover a dangerous condition, that employer is thereby under a duty to inspect the workplace and warn its employee as to such dangers. See, e.g., Clark, supra, 178 Ga. App. at 159, 342 S.E.2d at 468. Where there is nothing in the workplace to indicate the presence of a dangerous condition, the law refuses to require inspection by the employer. See, e.g., Williamson v. Kidd, 65 Ga. App. 285, 155 S.E.2d 801 (1941). If the employee could discover the dangerous condition through ordinary care, the employee is generally unable to recover from the employer under the safe workplace rules. See, e.g., Holman v. American Auto. Ins. Co., 201 Ga. 454, 461, 39 S.E.2d 850 (1946); Clark, supra, 178 Ga. App. at 158-59, 342 S.E.2d at 468. The duty on the employee is not a duty to inspect, but rather to observe open and obvious dangers such as would be disclosed by the exercise of ordinary care. See, e.g., Owensby v. Jones, 109 Ga. App. 398, 399, 136 S.E.2d 451 (1964). The rules concerning a safe workplace continue throughout the duration of the employee's work day and apply within the employer's entire premises. Therefore, an employee working out of a home office in a telecommuting situation may be covered by the safe workplace laws to the same extent as an employee injured while using an employer provided cafeteria on the premises, a satellite office, or a mobile trailer.

Finally, an employee may not recover additional damages under safe workplace rules over and above those contained in the Georgia Worker's Compensation Act. See, e.g., Dugger, supra, 199 Ga. App. at 850, 406 S.E.2d at 484.

C. OSHA Liability

The Occupational Safety and Health Act of 1970 ("OSHA") may preempt some claims under the safe workplace rules. See, e.g., 29 U.S.C. § 667(a)(preempting states from "asserting jurisdiction under state law over any occupational safety or health issue with respect to which [an OSHA] standard is in effect under Section 655").

In addition to Georgia's workplace safety rules, OSHA requires a covered employer to provide a workplace free from hazards that are likely to cause serious harm or injury. E.g., 29 U.S.C. § 654. Again, although telecommuting is not expressly included in the statutory definition of "place of employment," this definition is broadly interpreted and will likely include at least the home office portion of the telecommuting employee's residence. In order to avoid OSHA liability, an employer should work with the employee in designing and maintaining a safe, hazard-free home office. The telecommuting agreement should allow for the employer to conduct periodic inspections of the telecommuting work space.

D. Employee Fraud

In the majority of accidents involving telecommuters, there will be no witness to the accident other than a pet or infant child. The employer must rely solely on the employee's story as to whether the injury arose out of and occurred in the course of employment. Notwithstanding this disadvantage, employers should still require telecommuting employees to follow the same procedures in recording an injury within a certain number of hours, inspecting the premises, and investigating the cause of the injury. These procedures should be set forth in the telecommuting agreement.





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