Seyfarth Synopsis: What a difference a couple of weeks make. The COVID-19 outbreak has forced change upon all aspects of society, and the workplace is no exception. Many workers who escaped layoffs or furloughs are now adjusting to a new normal: working from home. In this post, we explore best practices for mitigating the risk that these so-called “WFH” arrangements present.
As we end a tumultuous March, many employees are settling into a novel work environment: their home. Though plenty of businesses were accustomed to work-from-home arrangements before the COVID-19 outbreak, many more are allowing WFH for the first time or extending WFH arrangements to segments of their workforce that never enjoyed them before.
Notwithstanding the flexibility they provide, WFH arrangements also present distinct wage-hour risks. The risks seem particularly great when WFH is rushed into action as a result of outside forces, with minimal notice or planning. Employers who fail to carefully monitor these arrangements risk facing costly claims years into the future for time that individuals thrust into WFH roles claim they worked without pay.
WFH arrangements are not “one size fits all”—the benchmark for appropriateness can vary by industry, company, and job function. There are, however, general best practices that employers can consider to help mitigate and manage WFH-related wage-hour risks. Here are ten that come to mind:
- Reiterate Timekeeping Policies. Remind non-exempt employees, in writing, that timekeeping policies apply with the same force as before. Managers should be crystal clear with their employees that they must record, and will be paid, for all hours worked, without exception.
- Set Schedules. Employees who abided by a set schedule before should be expected to do so at home, too. Where possible, involve employees in assessing whether their WFH schedule needs to change due to their new setting or circumstances. Once the schedule is set, hold them accountable. The circumstance to avoid is one in which an employee claims that the WFH setup meant that their workday became more nebulous and they were essentially working, or on-call, at all hours.
- Establish Boundaries. Closely related to setting and enforcing schedules, it’s important to have boundaries, particularly with non-exempt workers. Working from home can make it easier to fall into a habit of informally communicating with an employee, for instance through “this will only take a minute” calls or “feel free to respond whenever you have a minute” texts. These sorts of communications, if sent outside of an employee’s working hours, can fuel an off-the-clock claim.
- Identify and Address Any Gaps in Your Timekeeping System. Your timekeeping function must be configured to reasonably accommodate the WFH arrangement. If it’s not, work quickly to address any gaps, whether via software enhancements, new procedures/protocols for reporting time (e.g., sending an email to the supervisor each day confirming work time for the day before), or something else that makes sense for your business.
- Require Employees to Certify Their Time. While it’s an employer’s obligation to keep accurate time records, it’s sound business to make the employee part of that process. To that end, you should require WFH employees to record their time each day and to certify—whether on their timesheet, in the timekeeping system, or some other means—that their submission is accurate and reflects all hours worked. A verified or signed certification is a great exhibit in the event of a future lawsuit alleging off-the-clock work.
- Train Supervisors to Be Vigilant. Supervisors must be clear in their understanding of, and in their communications about, the company’s timekeeping expectations. Moreover, they must be vigilant in enforcing those expectations. A supervisor who regularly receives work-related communications at 10 pm from an employee’s whose schedule ends at 7 pm should be equipped to notice and address the potential issue.
- Remember Meal and Rest Requirements. California and various other states require employers to provide non-exempt employees with meal and rest breaks. Such laws apply equally in the WFH context. As a result, employers should instruct employees to abide by meal and rest period policies even while working from home.
- Avoid Salary Basis Issues. While the bulk of WFH concerns center around non-exempt employees, it’s also important to watch out for salary basis issues for exempt workers. If an exempt employee is on unpaid leave, the employer must communicate clearly to the employee that she should not be working, even at home. If she works during the week, she should be paid her full salary.
- Pay Attention to Expenses. If non-exempt employees incur costs as a result of the WFH arrangement—for example, having to buy a particular printer or add a phone line—it’s important to ensure that it does not reduce their pay below minimum wage or cut into any overtime compensation. This potential issue looms especially large for employees paid at, or very close to, the applicable minimum wage. The U.S. Department of Labor’s Wage & Hour Division reiterated the point in its recent FAQ addressing COVID-19 issues. Beyond potential minimum wage issues, note that some states (e.g., California, Illinois) require reimbursement of business expenses irrespective of classification or the impact on minimum wage.
- Listen. This is a difficult and uncertain time for employees and employers alike. Now more than ever, we advise inviting open communication with employees about work-related issues—including about any challenges that WFH presents—and being prepared to act quickly to address issues or assuage concerns.
At a time when employers have so many serious concerns to balance and triage, the wage-and-hour risks presented by WFH arrangements may not seem the most critical. If left unaddressed, however, these risks may be among the most long-lived legal risks from this time period, coming back to roost years after this crisis has unfolded. If you have questions or concerns, please contact the authors of this post or the Seyfarth attorney with whom you regularly work.