The recent DOL ruling on overtime exemptions has many employers scratching their heads when they consider their telecommuting practices. The dilemma? When an employee is exempt, he/she is paid a salary amount regardless of hours worked. But for many employees who telecommute, their exemption status will be kicked out the door come December 1 if they don’t make the minimum $47,476 salary amount. This means the employer’s policies, expectations, and timekeeping will have to be clarified and implemented to ensure compliance… and to avoid a costly lawsuit.
Every company will have to evaluate individually whether or not telecommuting will still be available to nonexempt employees. Of course, there are pros and cons to both sides.
Pros of allowing telecommuting: Maintain high morale, sustain high employee retention (particularly those who were hired under the expectation they would be allowed to telecommute), and no constraints on office space or parking.
Cons of allowing telecommuting: Employer will have to create a mobile timekeeping system to track/monitor work done off-site, as well as establish new ground rules of expectations to be signed off by both parties.
Employers could continue the option of telecommuting for exempt-only employees (i.e. for employees making more than $913/week), but morale issues will surely follow with feelings of “unfair” or “untrusting” company leadership.
If telecommuting is eliminated altogether, employers may consider allowing four 10-hour shifts to help employees not have to commute as often to the office. Perhaps working at the office could be phased in over time to accommodate those who were hired on a telecommuting basis.
If telecommuting is still an acceptable work arrangement at your workplace come December 1, you’ll need to identify, discuss and write out clear expectations of when overtime is acceptable, if at all. Methods of tracking all work time will also need to be clearly explained, particularly if the employer requires tracking time for specific jobs.
You, the employer, will be responsible for procuring a time keeping system and providing access to the employee for tracking work time – both in telecommuting arrangements and on-site. Some attorneys have voiced concern that a telecommuting employee may underreport hours and then later claim wages that should have been paid for work spent off-the-clock, but having an accurate time keeping system and laying out clear expectations should minimize that concern.
At the end of the day, telecommuting can still be implemented at your workplace, even after the DOL’s new ruling goes into effect. But it’s worth your time to consider the implications of any action you may want to take once your previously-exempt employees are reclassified as nonexempt. For questions or concerns with your specific scenario, please contact our HR experts at email@example.com.