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Liability & Risk Management

 

Telecommuting Risk – Who is Liable?

What do all of these claims have in common?  The courts ruled in favor of the
Employee – it turns out…Employers are liable.

  •  Tripping over a dog while working at home- Sandberg vs. JC Penney Co, Oregon, 2011
  •  Assaulted by a neighbor while fixing a sandwich during work hours at home – Wait vs. Travelers Indemnity Company of Illinois, Tennessee, 2007
  • Professor slips on stack of papers while preparing  a class syllabus at home –California Court of Appeals, 1980, first recorded case law on telecommuting.
    (Read more on these cases and others in the links below)

The Workers Compensation Landscape is Changing 

Telecommuting grows in popularity as organizations continue to realize the numerous advantages and tremendous cost savings that go along with it.  One area that is of growing concern is the area of risk liability and workers compensation. Many companies are under the belief that workers compensation does not apply once employees are off company property – this couldn’t be further from the truth when it comes to working remotely Although case law to date is minimal and formal legislation guidelines are not readily available, there are rulings which demonstrate the exposure employers face by allowing their employees to telecommute without setting specific guidelines (see articles below). It is up to the employer to err on the side of caution and plan for unforeseeable circumstances that could result in claims filed.  For many organizations, telecommuting is unchartered territory. There are bound to be misconceptions and concern for the “what-ifs”.  As an organization, you must become educated on the subject and plan accordingly with your legal and insurance teams before you begin sending workers home.  The good news is, there are many things that can be done to greatly reduce these risks such as taking the time to formalize a policy.  Work to develop procedures & agreements, make use of home office safety checklists, offer information on ergonomics and provide appropriate and safe furniture and equipment.  The benefits of taking these precautionary measures far outweigh the costs to put them in place.  

As referenced in a recent publication Telecommuting: A Growing Trend with New Liability Issues here are a few things companies with telecommuters can do to avoid potential liability risks: 

  • Screen employees carefully with thorough interviews and background checks, as well as trying to find out about any past lawsuits or worker’s compensation claims.
  • Ask about the workspace the telecommuter intends to use as an office so as to help identify any potential hazards or risks. Although this has to be done carefully due to certain laws, site checks can be performed to ensure the workspace is ergonomically safe and safe in general. This can also help avoid claims due to things like carpal tunnel since computers are a staple in telecommuting.
  • Establish clear guidelines when it comes to what is expected of the employer as far as tasks and duties.
  • Find out how the employee intends to complete the assigned duties and tasks.
  • If possible, try to reduce the amount an employee has to travel since an employer is likely to be held responsible if an accident occurs when an employee is traveling on behalf of the employer.
  • Educate, inform, and create awareness about injury prevention and safety that’s built around working from home.
  • Talk to your insurer about possible liability risks, the pros and cons of using telecommuters, and make sure you’re carrying adequate liability and worker’s compensation insurance.
  • Contact the U.S. Department of Labor, review state and local legislation, and specific worker’s compensation laws for the state the company is based in, as well as the states any telecommuters live in.

OSHA Involvement

A little over 10 years ago, the federal Occupational Safety and Health Administration suggested that in-home inspections be performed for telecommuting workers however this was quickly revoked to due privacy concerns.  Even though OSHA is not directly involved, employers are still at risk under state Workers’ Compensation laws.

 Excerpt from the OSHA web site:
“Employers who are required, because of their size or industry classification, by the OSH Act to keep records of work-related injuries and illnesses, will continue to be responsible for keeping such records, regardless of whether the injuries occur in the factory, in a home office, or elsewhere, as long as they are work-related, and meet the recordability criteria of 29 CFR Part 1904.”
http://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=DIRECTIVES&p_id=2254#policy

 Excerpt from Business Week online – Telecommuting: A Legal Primer:
Workplace Safety: The federal Occupational Safety and Health Administration said that it will not inspect employees’ homes for compliance with federal safety standards, nor expect employers to do so. But don’t get too comfortable. Even with OSHA out of the picture, you may not be off the hook for a work-related injury that occurs in your employee’s home office. “There well may be employee claims that employers have to honor or investigate or pay based on state Workers’ Compensation laws,” says Charles Jeffress, assistant secretary of Labor for OSHA.

 Based on recent court rulings, you probably won’t be held accountable if your employee bangs a knee on a filing cabinet while working at home. But there’s still no legal precedent regarding telecommuters who claim work-related musculosketal injuries such as carpal-tunnel syndrome, a painful wrist condition.
http://www.businessweek.com/smallbiz/0003/sb000320.htm

Other useful articles and case examples 

 Telecommuting: The Legal Landscape and Best Practices For Employers                                     http://www.lanepowell.com/wp-content/uploads/2009/04/ostroffp_009pdf.pdf

Telecommuting: The Future Office or an Insurance Nightmare
http://www.insurancethoughtleadership.com/index.php/site/safety-risk-control/telecommuting-the-future-office-or-an-insurance-nightmare/ 

Legal Matters: Legal issues abound in telecommuting                                                                                                                     http://finance-commerce.com/2012/05/legal-matters-legal-issues-abound-in-telecommuting/

 

At-home workers create new risks for employers
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