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"Don't look for me, I'll be working from Starbucks today": a review of regulations that may apply to off-site workplaces.

Article Excerpt
As employers seek to secure needed talent they are becoming more open to alternative work arrangements, including home-based offices and other off-site work locations. Such arrangements, however, can be legally ambiguous because the line between personal and business space and activities may be unclear. Union organizers may also question home-based work arrangements. Employers contemplating alternative work arrangements need to look into their liability exposure under a variety of laws, such as the Fair Labor Standards Act of 1938, workmen's compensation laws, the Occupational Health and Safety Act (OSHA), the National Labor Relations Act, the Americans with Disabilities Act, and local zoning ordinances. Forewarned may indeed be forearmed.

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Off-site workers are an evolving phenomenon. Traditional office boundaries are expanding dramatically through technological improvements and wireless access. With this expansion comes the redefinition of the office space where work is done for the employer. Both employees and employers now see the advantages of the off-site space where the employee can complete tasks in the environment of the home or coffee house. This trend of working outside the traditional work space has come into conflict with established legislation and laws designed to protect workers and their communities.

In this paper, the authors first define and describe five different types of off-site workers. Second, they apply the restrictions of the laws governing the traditional workplace to the home and off-site workplace. This basic analysis of legal issues may prove useful to any employer who contemplates an arrangement for employees to work off-site.

What are the Different Kinds of Off-Site Employees?

A study completed in the early days of the home-based employee determined there were five types of off-site employees:

1. The employer-sponsored telecommuter

The telecommuter is employed on a full-time basis by an organization. His or her company is the primary source of income, and the employer has given permission for this individual to work outside of the traditional office on a regular basis. This may include an office space set up in the employee's home specifically for completing the employee's duties to the employer.

2. The after-hours worker

The after-hours worker brings work normally done at the office to an off-site location with or without the permission of the employer.

3. The part-time self-employed worker

This individual is employed by the organization while at the same time is exploring the possibility of doing his or her job out of a home-based operation.

4. The self-employed employee

This individual owns and operates his or her own organization. They are their own boss running their company out of their home.

5. The franchisee

This person has purchased a franchise that allows him or her to work out of an office based at the individual's residence (Sullivan, 1996).

This discussion is concerned primarily with the first category, the employer-sponsored telecommuter. The employer responsibility issues addressed by the authors are hardly new. A 1994 Small Business Reports article cautions employers to review the pertinent legal guidelines (the Fair Labor Standards Act, the Occupational Safety and Health Act, and the Americans with Disabilities Act) and plan to meet the requirements with a telecommuting workforce (Fitzgerald, 1994). The American Society for Training and Development prepares workers for the telecommuting lifestyle as described in their February 1996 magazine (Piskurich, 1996).

At this moment, a thoughtful and deliberate acknowledgement of legal issues is necessary. Many employers are reviewing and implementing telecommuting as either a cost savings tactic or a disaster recovery/business continuity strategy.

Evaluating Regulatory Risk

Well-intended or emergency use of telecommuters may result in either employer liability or violations. What follows is a basic summary of the Fair Labor Standards Act of 1938, Workmen's Compensation, the Occupational Health and Safety Act, and a general overview of zoning issues and labor law. Within each summary, the authors present potential issues or challenges for employers who include telecommuting as one of their employee arrangements. Exhibit 1 provides a summary of the laws and the worker status.

* Fair Labor Standards Act of 1938

The Fair Labor Standards Act of 1938 clearly states that an employee who is "suffered to work" more than 40 hours in a given seven-day period is entitled to time and one-half of his or her normal hourly rate. This law covers not only hourly employees but also those engaged in production compensated as piece work performed on the premises of the employer. Questions are now raised about the individual working on a homework or piecework basis in the home. Is this person entitled to overtime? What happens when the employee works a schedule he or she determines in a home-based office, and this schedule exceeds 40 hours in a given week? (52 Stat. 1060 (1938): 29 U.S.C. [section] [section] 201-19)

The Fair Labor Standards Act of 1938 (FLSA) mandates overtime, minimum wage, and record-keeping provisions for all employees not considered exempt under FLSA. The new employee with a laptop is able to move away from the worksite and complete duties formerly done within the confines of the office. This creates some interesting scenarios from a human resources standpoint. An enlightened employer who allows a new mother to remain home with her baby and complete her duties on line creates two problems with the FLSA. The first involves the entitlement to overtime. A mother with a new baby will certainly not be working a straight eight hours at her employer's duties. Her schedule of work will more likely be dictated by the baby's feeding schedule. This raises the question of how many hours she actually works. Will the baby's schedule cause her--inadvertently or otherwise--to break 40 and be entitled to overtime? The second question involves record keeping. Employers have strict mandates under FLSA on the recording of hours when an employee is "suffered to work." This record keeping problem could quickly lead to understating or overstating the employee's actual...

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