Employers who issue smartphones to their employees need to consider how those devices may impact overtime and internal policies. Most commonly, employees may be issued cellphones, smartphones, PDAs, tablets, pagers, or laptop computers, but the same concern arises out of simply providing remote access to the company’s internal computer system and/or email.
Companies need to examine how employees are granted access to work-related issues beyond regular work hours for several reasons.
A primary concern is overtime. While exempt employees are unaffected by the amount of time devoted to remote access of work, non-exempt employees are subject to overtime pay under the Fair Labor Standards Act. Quantifying the amount of time spent connected to work is challenging, because it is difficult to pinpoint how much time a person spends, for example, reading an email or even determining whether the person read the email during regular work hours or after-hours. Electronic time stamps and signatures can be useful, but they will not tell the employer whether the employee was half-heartedly reading work email for 30 minutes while watching “Dancing with the Stars.”
Another variable is determining how much time a person works that is considered “on-call” at home. In the case of Pabst v. Oklahoma Gas & Electric Company, the court determined that on-call employees who received three to five “alarms” per night and were also on-call during weekends were entitled to compensation, including overtime, for “15 hours per week day and 24 hours per Saturday and Sunday” in addition to their regularly scheduled hours. In other words, these employees were entitled to back-pay for the whole period of time they were on-call which was almost entirely overtime.
The consequences of failing to properly pay employees can be devastating. Not only can an employee seek up to three years of back-pay in a lawsuit, the employee may be entitled to recover all legal costs and even additional damages if a court finds the employer’s failure to properly pay the employee was not a good faith mistake. Also consider that many lawsuits involve not just one employee but rather a group of employees, thereby multiplying the potential liability for employers with each employee involved.
Thus, an employer must initially decide which employees should have remote access. Then it should implement policies to ensure that it appropriately reflects its intended use of remote access. Companies should strongly consider whether it is feasible to only allow exempt employees to have remote access. If it allows non-exempt employees to have remote access, it needs to be aware that it still could be liable to pay for any work done by an employee even if the employee is not authorized to work additional hours.
The company’s internal policy should be reviewed holistically to ensure that employees who the company does not want accessing work after-hours are put on clear notice of that fact. For example, if a non-exempt employee is provided a laptop and remote dial-in codes because she floats between more than one company location, the employee must be notified, ideally by direct communication and the company policy, that she is not to use the remote access outside of her regular work hours.
Also, many aspects of a company’s written policy must be considered together, such as policies covering telecommunications, use of work-provided electronic devices, internal and external communications, recording time, security, and discipline if an employee does not follow the policy. Courts and arbitrators will typically construe an ambiguous policy against the employer should a dispute arise over policies that do not clearly state the same expectation.
To illustrate how this could easily happen, imagine a company has a 15-year-old telecommunications policy that was intended to govern the use of internal, landline phones at a call center, but the language is broad enough to cover all company-owned communication devices. This company also has a five-year-old cellphone policy which prohibits the use of a company cellphone unless the employee is at a company job location. If an employee uses a company-issued cellphone from home, discipline against the employee may not hold up because the telecommunications policy does not address the prohibition or otherwise reference the cellphone policy.
The laws are very detailed and any questions regarding a company’s policies regarding after-hours access to work should be directed to a qualified legal professional, but regardless, almost every company with employees may be impacted by this issue. It is better to plan and prepare for these scenarios than it is to wait until a legal issue develops.
• Kelly A. Cahill is an attorney with Zukowski, Rogers, Flood & McArdle in Crystal Lake. A longtime Crystal Lake resident, Cahill devotes most of her practice to employment law and to municipal and local government law. Cahill serves as a municipal attorney for the village of Algonquin. She also acts as counsel to the planning and zoning boards of the cities of McHenry and Genoa. Her email address is email@example.com.