Due to the COVID-19 pandemic, many of us are working from home, but what does this mean for your business? What do you need to consider? Working from home or working remotely literally creates a whole new environment, and this means new opportunities but also new risks. Understand what you're getting yourself into, and learn what steps you need to take and key points you need to consider when allowing employees to work elsewhere.
Why allow employees to work from home?
It is now obvious to most of us that an international pandemic warrants having employees work from home, but are there other instances when it might be wise to do so? There are many cases when it actually makes sense to ask some or all of your employees to work remotely. Winter weather could make traveling on the roads dangerous, so employees with long commutes or living in rural areas might be safer staying home. If half of your employees contract the flu, it may be in everyone's best interest to ask all employees to work from home to prevent the spread of disease. If your building is temporarily undergoing repairs or renovations, working remotely could allow your business to remain productive and keep you on schedule for when employees can return to the office.
Employees might also ask to work remotely. The freedom to work from home is a huge benefit: it gives your employees more flexibility, eliminates their commute, and allows them to spend more time with family. Working from home also reduces stress. New hires may negotiate this as part of their contract and current employees could also ask to work remotely for a variety of reasons: a long and stressful commute, a new addition to the family, or simply the desire for an improved work-life balance. Working from home may also be more comfortable and healthier for employees with disabilities, chronic illnesses, or older workers. You may be surprised to learn that remote work is actually most common in older workers!
The bottom line is that working remotely is a growing trend and is here to stay, and ignoring this fact could be risky. A 2018 survey found that 61% of respondents considered leaving a job because it was not flexible.
How does working remotely affect productivity?
Believe it or not, working from home can actually be a big benefit. A two-year study found that not only do employees who work from home have higher attrition rates with the company, but they actually work more productively. Working from home results in a full day's worth of increased productivity. Read more about this study here.
It makes sense that working from home increases the likelihood your employees will remain loyal to your company. Flexibility can allow them to accomplish work and life responsibilities more efficiently and saving time and money by forgoing commuting is a big perk. This flexibility can also mean health benefits because employees are less stressed.
How might having employees work from home affect my insurance?
If your employees are going to work from home, you should require them to prove to your that their homeowner's or renter's insurance policy will adequately cover them. If an event were to happen at an employee's residence while they were working, they need to be certain their current homeowner's policy would cover this event. Ask for documentation from all employees.
Ask your insurance agency what coverage your current policy includes for remote work. You may need to consider additional insurance to properly cover your risks. Home-based insurance is an option, especially if you think you may regularly have workers operating remotely.
How might working from home affect your risk as a business?
Working remotely can potentially mean a whole new world of risk, depending on your type of business, what you allow your employees to do remotely, what resources you have available to you, and how well-prepared and informed you are about remote work. Your employees could accidentally expose your network to a virus. They could forget a flash drive at a coffee shop or they could access your company's network using public wi-fi. If you let your employees take equipment home, they may damage or accidentally destroy it.
On the bright side, if your employee is injured while working from home, your worker's compensation will likely apply just as it does in the office, but it's always best to ask your insurance agent to be certain. There are also many steps you can take to reduce and even eliminate these risks.
How can I reduce risk when employees work from home?
Create a policy that maintains the same health and safety standards you would expect from employees working in the office, and make sure this policy is clearly communicated to employees. Specify what activities can be completed remotely and what activities and responsibilities should only be completed in the office.
Make sure you are clear about work hours and how employees will be compensated. Set rules for overtime and require stringent documentation of hours and duties performed. Require your employees communicate regularly. Be careful about allowing employees to work outside their normal hours and make sure you are complying with all wage and labor laws. This includes breaks and overtime compensation. Expectations and rules should be clearly communicated to employees.
Cyber security is a major concern when you have employees working remotely. Determine sooner rather than later how you will store and access data. What policies will need to be in place, how will those policies will be monitored and enforced, and what software may you require to ensure your customers and your employees are safe online? There are many ways confidential data can be stolen, and you will have to limit the work your employees are able to conduct remotely if you cannot provide the right levels of security. If this is the case, make sure you are very clear with employees about what they can and cannot do remotely. Can they use their cell phones? Can they work at a coffee shop or public place? Can they leave their work computer in the trunk of the car? At bare minimum, ensure all of your employees understand the threats and risks. Start with these easy ways to improve cyber security but don't stop there.
Hopefully you already have an emergency response plan for your business. Update it to include remote work and ask your employees to come up with their own plans for when they work from home. What risks might they be exposed to at home? What methods do they have of contacting you? How would they secure any important data? What steps would they need to take to evacuate their home? Having employees draft an emergency response plan lets you know what risks they might encounter, helps you avoid any unwelcome scenarios, and is an important step in keeping everyone as prepared as possible.
What are my other options?
If asking employees to work remotely isn't an option, there may be times when you're forced to close operations entirely to wait out whatever threat exists. In these instances, having business interruption insurance can be a lifesaver for your business. Business interruption coverage protects against loss of income that is a direct result of loss of or damage to your property due to a covered event, such as a fire or a natural disaster. Physical damage to your property is typically a requirement. Business interruption coverage isn't a cure-all. If an event not covered by your property insurance policy forces you to close your doors, business interruption coverage will not help you.
In the case of the current coronavirus outbreak, there have been no successful cases of insurance companies covering infectious disease outbreaks, as far as we are aware. However, given the serious nature of the current outbreak, this may change.