Telecommuting Benefits and Drawbacks for Employers

Last Updated February 25, 2020

As employers seek out new ways to provide employees with a greater work/life balance while helping improve retention rates, telecommuting is becoming a popular option. This style of work is different than a traditional office job in a number of ways and can have great advantages for employers and employees if the program is carefully crafted to meet employee needs and business requirements. However, there are some potential disadvantages that employers should be mindful of when establishing this type of working environment.

What is Telecommuting?

Telecommuting is an alternative work arrangement in which an employee works outside of the standard office, often from home or a location close to home, such as a local library. Telecommuting can be a full-time arrangement, in which an employee works remotely all the time, or it may be allowed on certain days of the week or when issues arise that make it practical.

Rather than requiring the employee to report to an office, the employee uses computer connections and telephones to remain in contact with supervisors, coworkers and clients. This can enable greater freedom for employees in regard to working hours and environment while still meeting the needs of the business.

Benefits of Telecommuting for Employers

There are a number of potential benefits for employers when they establish well-designed telecommuting programs for their employees. Some of the benefits can include:

• Increased productivity – While it might seem out-of-sight employees will take advantage of opportunities to slack off, studies indicate the opposite. A 2014 Stanford study showed that call center employees increased productivity by 13% when they worked from home. The University of Texas conducted a similar study and found that telecommuters worked on average, 5-to-7 hours longer than their in-office counterparts.
• Reduced turnover – Employee turnover can be a costly proposition for a business. Studies have shown that employees who are able to telecommute tend to be much happier than their in-office counterparts. When employees are happy, they are typically less likely to leave a position, which can add up savings for employers in the long run.
• Increased morale – This, too, can have an impact on turnover. Employees who are able to work from home and enjoy a better work/life balance tend to feel more valued. A Pennsylvania State University study showed that telecommuters tend to be less stressed and happier than traditional office workers.
• It’s environmentally friendly – Telecommuting takes the commute out of the working equation. For eco-conscious companies, this can be a big win.
• It’s economically sound – Employees aren’t the only ones who can enjoy financial benefits associated with telecommuting. It is estimated companies can save approximately $11,000 annually on each employee who telecommutes.

Potential Drawbacks

Telecommuting isn’t without its potential drawbacks, however. Companies that are considering this policy should note these possible pitfalls and seek ways to overcome them:

• Less oversight – It is nearly impossible to provide direct oversight or to micromanage a teleworker. There are ways, however, to overcome this potential pitfall by creating performance benchmarks and making sure employees who work remotely are meeting the requirements in regard to production and quality of work.
• The chance for production loss – While many workers can flourish in a telecommuting situation, some may not. Production and quality benchmarks can serve as motivators for these employees who find the distractions of home difficult to overcome.
• Security concerns – Remote access needs for telecommuting staff can create security leaks in company computer systems. Protocols should be put into place to shore up any gaps in security, including training on remote access security and frequent password updates.
• A lack of brainstorming ability – Remote workers can feel isolated and may find it difficult to collaborate with other colleagues on projects. Online team meetings, shared documents, frequent calls and occasional face-to-face sessions can help overcome these potential obstacles.
• Feared damage to a career – Some people believe telecommuting might put them at a career disadvantage when it comes to advancement. Employers, however, can overcome this perception by keeping the lines of communication strong and open while ensuring employees are given the opportunities to prove themselves.

Tips for Establishing a Telecommuting Program

Launching a carefully-planned telecommuting program can deliver employees a number of benefits. Consideration on the front end can help remove some of the potential pitfalls. With that in mind, here are a few tips for creating a program that meets employee and employer expectations:

• Consult legal advice – Be sure to talk with a legal expert about issues such as workers’ compensation, overtime, responsibility for company property.
• Get input on program creation – Managers and supervisors should have a say in designing a company-specific telecommuting program. This extends beyond what equipment should be issued to include assessing and establishing workflow, what positions are viable for telecommuting, establishing guidelines and so on.
• Create clear guidelines – Make sure the program is clearly defined in regard to employee roles and responsibilities, what days telecommuting is allowed who the policy applies to, including positions it does not fit.
• Keep communication strong – Devise tools upfront to help telework employees stay connected to supervisors, team members, clients and the office. Skype, teleconferences and other tools can go a long way toward improving communication.
• Keep it fair – Once guidelines are established for what positions lend themselves to telecommuting and which ones do not, stick to the policy. Don’t make exceptions to the established rules, but do be fair to those who are in the office by ensuring they are not left to pick up the responsibilities of those who can telecommute.

A carefully established telecommuting program can deliver a number of benefits for employers. Take the time to plan out a program with an eye toward removing some of the potential pitfalls. Once a program is established, review policies periodically to make adjustments where warranted. When a solid program is established, companies can retain talent while seeing their expenses drop and productivity rise.