ASK ITAC

Although our department has had a group of telecommuters for several years, we still feel resentment from coworkers who don't telecommute, due to job description or personal choice. We are often referred to by our coworkers as "you telecommuters." Since we only have voice mail at work and no physical phone that can be answered at the office, it is a guarantee that you will get our voice mail if you call the office number.

This is used as an excuse to avoid talking to us. Is there a code of conduct anywhere that addresses these issues? For example, I would prefer to be called a Designer or Developer, as opposed to a "telecommuter." Please help.

Dealing with jealousy and resentment can definitely make your job more difficult. If you haven't already done so, ask your management for help. At the very least, your manager should help to start a dialogue between "you telecommuters" and your coworkers. There may be real problems. Maybe in the work is divvied up unfairly or the in-office folks end up fielding more telephone calls than you or they have to attend more meetings and feel resentful about the additional job burden. You may also uncover that telecommuters spend more time working than their central office mates or that work processes are needed to improve remote work efficiency. Get the issues out in the open and come up with consensus solutions.

You can also use these conversations as opportunities to discuss job titles. You should definitely be called the same title as others in the office doing the same work. Telecommuter is merely a description of how you get to work, not what kind of work you do. Does your job situation allow you some in-office time as well? If so, try to get into the office more often. Ask to be included in after-hours events and parties. These social events are important. They let you catch up on office chitchat and reestablish important ties. If your group doesn't have such events, start something on your own. One company has a monthly potluck dinner that brings teleworkers and in-office folks together. Another one uses company sports events as the social glue.

Full-time telecommuters have to be extra diligent to stay in the loop. Contact and communications with coworkers is crucial. If your coworkers don't call you, take the initiative and call them. They may initially feel uncomfortable calling you or be concerned that they're "bothering you at home." Make sure you make it clear to everyone that you're just as available from home as you were when in the office.

June Langhoff, author of The Telecommuter's Advisor: Real World Solutions for Remote Workers (Aegis Books 1999) answered this month's question. Her Telecommuting Resource Center (www.langhoff.com) is a guide for telecommuters, telecommuter wannabees, managers of remote workers, and all sorts of people who work at a distance.

Dear ITAC: I have been searching for companies that offer telecommuting, on the internet and elsewhere. How do I find a job in which I can telecommute? There doesn't seem to be any sources out there...Signed Potential Telecommuter

Dear Potential Telecommuter:

You must understand there are few companies that hire employees as teleworkers. Consider putting yourself in your potential employers' shoes. Would you be willing to hire someone you never met if his or her primary objective was to work at home? Unless you are talking about a remote sales position, even telecommuting companies typically expect new hires to be on the job for six months or so before they work from home. I recommend that you find an employer with a family-friendly corporate culture, get hired, establish a reputation as an excellent employee, then convince your manager to try a telework option. ITAC's Atlanta chapter makes some excellent suggestions on searching for a teleworking jobs and has accumulated a list of resource pages you could try. Take a look at this ITAC chapter for more information.

Dear ITAC: I work for a large medical software company in the Boston area. We are currently in the early stages of implementing a telecommuting plan for some of our long-term employees and supervisors, some of whom live out of state. I work for the Corporate Counsel for the company and was wondering if there are any publications that go into detail regarding tax laws and how they apply to telecommuting. For example, we have a supervisor who lives in RI, that will be telecommuting approximately 3 days out of the week. This supervisor will be getting income tax withheld for working in the state of Massachusetts, and I'm sure will get a credit on their RI income tax for the amount paid to MA IRS. What we are trying to find out is if the Company, for whom the supervisor works for, has to pay taxes to the state of RI for "conducting business" via telecommuting. We are also trying to find out if there are laws governing this that change from state-to-state. We currently have employees who live in NH, ME, and CT as well. I would appreciate any information you could give, as I have spent a great deal of time on the phone with all of these state's Departments of Revenue, with no luck in getting this question answered....Signed JC

OUT-OF-STATE TELECOMMUTERS: ASSESSING THE RISK

By: Charles F. Knapp, Faegre & Benson, LLP, © 1999 Faegre & Benson

The existence of out-of-state telecommuters poses a number of interesting legal issues for employers, particularly employers who do not otherwise employ workers in other states. Employers who allow such arrangements may unknowingly expose their company to additional employment and tax law obligations.

Virtually every state has a number of employment law statutes that prohibit certain conduct and impose special obligations on employers, including but not limited to non-discrimination statutes, leave laws, employees rights laws (e.g., drug testing, monitoring, and background investigations), workers' compensation statutes, and unemployment compensation statutes.

Whether these statutes apply to employers whose only contact with the state is that they have one or more employees telecommuting from residences in that state will depend on the specific statutory definitions. As a general rule, however, employers should assume that allowing an employee to telecommute from another state on a full-time basis will subject those employers to the employment law statutes of the other state with respect to the telecommuting employee. Therefore, for example, an employee telecommuting from her home in Chevy Chase, Maryland may have different leave of absence rights than her co-workers officing out of the employer's Arlington, Virginia corporate headquarters.

In addition to statutory law, states also have their own body of court-created law (or "common law") that impose varying rights and obligations regarding a variety of employment law issues, such as whether employees may be discharged "at will," whether employees have a right to privacy, and circumstances under which a noncompetition agreement will be legally enforceable. While I am not aware of any reported decisions directly addressing this issue, related caselaw suggests that courts will hold employers to the common law standards developed in the state in which an employee telecommutes on a full-time basis. Therefore, for example, a Spokane, Washington employer employing a home-based telecommuter from Helena, Montana may be surprised to know that although Washington courts have adopted the doctrine of "at-will employment," Montana common law provides that employees are presumed hired for the length of term for which the employee's wages are calculated.

Another important issue regarding out-of-state telecommuters is whether employing an out-of-state telecommuter will subject an employer to the corporate income tax of the telecommuter's home state. The answer to this question will depend on each state's tax code and regulations. While federal law places some restrictions on a state's ability to levy corporate income taxes on out-of-state businesses (e.g., states may not imposes such taxes on businesses selling tangible personal property if the only activity of that business is the solicitation of orders by its salespersons), these restrictions do not prohibit states from imposing taxes on companies who employ production, administrative or executive employees in another state. Most states will impose corporate income taxes on businesses that have a sufficient "nexus" with that state. Whether the existence of telecommuting employees establishes sufficient "nexus" will depend on the statutory definitions of "nexus" and the specific work performed by the telecommuting employee(s).

For example, Wisconsin law provides that the following will constitute sufficient "nexus" to subject an out-of-state corporation to Wisconsin corporate income tax: (1) "maintenance of a business location in Wisconsin, including any kind of office;" (2) "usual or frequent activity in Wisconsin by employees . . . soliciting orders with authority to accept them;" (3) "usual or frequent activity in Wisconsin by employees . . . engaged in purchasing activity or in the performance of services;" (3) "miscellaneous other activities by employees . . . in Wisconsin such as credit investigations, collection of delinquent accounts, conducting training classes or seminars for customer personnel in the operation, repair and maintenance of the [business's] products;" and (4) "leasing of tangible property and licensing of intangible rights for use in Wisconsin." Based upon this statutory provision, it is easy to conceive of telecommuting scenarios that may subject a Minnesota employer with an employee telecommuting in Wisconsin to Wisconsin corporate income tax. For example, if the telecommuter works with equipment leased by the employer, performs purchasing duties, is engaged in telemarketing or other sales activity with the authority to accept orders, or performs consulting or other services to the business's clients from the home office, it would appear that the "nexus" requirement has been met. In addition, it is possible that the Wisconsin Department of Revenue may consider a home office used by a full-time telecommuter as "any kind of office" maintained in the State of Wisconsin.

For all of the above reasons, employers should carefully consider all of the potential legal consequences before allowing an out-of-state employee telecommute from home.

Charles F. Knapp
Faegre & Benson, LLP
2200 Norwest Center
90 South Seventh Street
Minneapolis, MN 55402-3901
direct dial: 612/336-3442
facsimile: 612/336-3026
[email protected]

NOTE: Further details are necessary for a complete understanding of the subject covered by this article. For this reason, the specific advice of legal counsel is recommended before acting on any matter discussed above. If you have questions about any of the issues discussed above or any other employment law matter, please consult with employment law counsel.

Dear ITAC:  Should employers pay telecommuters the same amount?

My answers are Yes, No and Maybe.

Yes, teleworkers should be paid the same as non-teleworkers who are performing the same tasks with comparable and agreed upon terms: quality, quantity, cost, and time, or any combination thereof. Shifting from the industrial age to the information age clearly calls for a shift from surveillance management to management by results; thus, compensation should be based upon predetermined results, as agreed between the teleworker and manager.

No, teleworkers should not be paid the same as non-teleworkers who are performing the same tasks with comparable and agreed upon terms: quality, quantity, cost, and time, or any combination thereof. Whether we admit it or not, compensation for labor includes the hidden cost of going to work. Teleworkers are spared some, or all of their commute costs (auto, insurance, clothing, food, care giving), that the non-teleworker may or may not endure. Compensation for labor is also a function of supply and demand and the availability of a qualified teleworkforce.

Maybe. To use an overused cliché, "one size doesn't fit all." I
encourage assessing each telework arrangement in light of the value to the employer, the employee, and our society, all with a view toward attaining our respective objectives, or win-win-win telework arrangements. There should be no losers with any telework arrangement.

Dear ITAC:  How much of a perk is telecommuting?

My answer presumes that a perk is a perquisite: "A payment or profit received in addition to a regular wage or salary, esp. a benefit expected as one's due." [The American Heritage Dictionary, second College Edition]

If telework is considered perk, it is a perk due both the employee and employer. I view the telework option as a mutually beneficial work arrangement, not as one's due or as one's entitlement. Any manager in her/his right mind should not agree to a telework arrangement that didn't have some benefit to the employer. I urge managers to search for easy-to-find benefits before agreeing to a telework arrangement. Among the many employer benefits are: retaining valued and skilled workers; cost-avoidance (recruiting and training a replacement); and the loyalty of an employee trusted to telework. Assuming the telework arrangement is a voluntary bilateral agreement, the outcomes should be positive for all.

This month's question was answered by David Fleming of  Fleming LTD Telework Consulting - purveyors of custom telework solutions for government and industry.