Legal Issues to Consider When Employees are Working from Home

By Paul J. Welk, PT, JD*

Given the recent world events with the COVID-19 pandemic, many physical therapy private practice owners have had to consider an issue for the first time: how to manage employees who are working from home.

While working from home or another remote location (“telecommuting”) is common in other industries, the vast majority of physical therapy private practices historically operate with all employees physically located onsite. When employees work from home, it raises a number of legal issues. The purpose of this article is to highlight legal issues for private practices to consider in this time of a “new normal” that will likely involve an increase in employees telecommuting.

WAGE AND HOUR CONCERNS

Under the Fair Labor Standards Act (FLSA), non-exempt employees must be paid for all hours worked, and those who work more than 40 hours in a work week are entitled to overtime compensation. The FLSA also requires, in order to ensure that the two above requirements are met, that employers maintain accurate records of hours worked. Presumably, all private practices have established policies and procedures to track time worked in the clinic. However, it is more difficult to track hours worked when employees are working from home, and to some degree the employer is at the mercy of the employee, having to pay them for all hours that the employee claims to have worked that day. Therefore, in order to comply with the FLSA and ensure that wages are paid for all hours worked (and not for hours not worked) an accurate system must be put in place to track the actual hours worked by non-exempt employees working from home. This may include the practice establishing a fixed work schedule and designating hours when non-exempt employees should not be performing any work functions such as checking email. In addition, practice owners should also consider how to manage meals and other rest breaks where applicable for non-exempt employees.

If an employee who is working from home is exempt, FLSA issues related to tracking time worked are likely significantly reduced; however, readers must keep in mind that an exempt employee who works even limited hours in a particular week is generally entitled to his or her full salary. Moreover, the FLSA provides that salary paid to exempt employees must be a minimum of $687 per week, and the amount that exempt employees are paid may not be based on their hours worked. An additional consideration for exempt employees is whether they have employment contracts or employment agreements that provide for a certain salary. If so, and the practice wants to reduce the salary to coincide with the reduced hours, it may be necessary to enter into an addendum to the contract or agreement.

DISCRIMINATION

Physical therapy private practices need to carefully consider which employees are permitted to work from home. A practice’s failure to utilize an appropriate decision-making process can put the practice at risk for a discrimination claim, particularly if the employee falls into a protected class (e.g., race, gender, age, etc.). In addition, when seeking to mitigate the risk of discrimination claim, employers should be cautious to ensure that remote workers are fairly treated when it comes to issues such as promotions and compensation. If certain employees are not permitted to work from home while others are, this distinction should be for legitimate, legally supportable reasons.

SETTING EXPECTATIONS

When an employer is new to the concept of managing remote employees, there is an increased risk of the employer’s expectations not being appropriately communicated. Employees who transition to remote work may not be clear as to what their expected availability/work schedule will be, how productivity will be determined, and what their required deliverables will be. By way of example, consider a physical therapist who historically saw patients in the clinic on a full-time basis but has now transitioned to working exclusively from home and performing visits by telehealth. Presumably, the employer’s expectations as to productivity, work schedule, compensation (including incentive compensation), and other matters will need to be reconsidered and redefined, and then communicated to the physical therapist. In addition to creating a difficult work environment, failure to establish, document, and communicate appropriate expectations can cause legal concerns; for example, when adverse employment actions are necessary due to a failure to meet newly established expectations.

HIPAA AND SECURITY ISSUES

HIPAA does not prohibit an employee from working at home; however, there are some unique issues to consider when employees are telecommuting as compared to working in the traditional clinic setting. For all covered entities (which would include, with very limited exception, all physical therapy practices), HIPAA requires that a risk assessment be performed as part of its compliance process. If a practice performed its last risk assessment at a time when it had no telecommuting employees but the practice now does, it should review its risk assessment¹ to determine how new privacy and security issues will be addressed. For example, practices with telecommuting employees may need to consider issues, such as whether network access required for clinical documentation from an employee’s home is appropriately secure; whether employees’ family members have access to computers and other devices that may contain patients’ personal health information; how hard-copy records are retained; and whether the video conferencing platforms used by the employee are HIPAA compliant. While certain risks will prove to be common across the physical therapy industry, each practice’s risk assessment will be unique and identified risks will need to be addressed accordingly.

POLICIES AND PROCEDURES

As practices establish telecommuting programs, it is important to document the terms of these programs in appropriate policies and procedures. These policies and procedures should consider human resources, compliance, confidentiality, operational, and other issues. Once policies are established, employee training should be completed and documented. When considering telecommuting issues and developing policies and procedures, practices should keep in mind that telecommuting is common in other industries, including some health care settings. Therefore, practices should be able to identify a variety of resources to assist them in establishing a telecommuting program.

As private practices adapt to modified staffing patterns in connection with the pandemic, telecommuting may be part of a practice’s solution. Practices must keep in mind that allowing employees to work from home is not a decision to be taken lightly and may be difficult from a legal and practical perspective to discontinue such a program in the future. By considering the issues outlined here and others relevant to the particular practice and the state or states in which it operates, private practices can, where appropriate, make the changes needed to operate successfully while mitigating risks relative to telecommuting employees.

References:

¹Security Risk Assessment Tool. HealthIT website. https://www.healthit.gov/topic/privacy-security-and-hipaa/security-risk-assessment-tool. Accessed April 26, 2020.

Paul J. Welk, PT, JD, is a Private Practice Section member and an attorney with Tucker Arensberg, P.C. where he frequently advises physical therapy private practices in the areas of corporate and health care law. Questions and comments can be directed to pwelk@tuckerlaw.com or (412) 594-5536.

Please note that this article is not intended to, and does not, serve as legal advice to the reader but is for general information purposes only.

*The author has a professional affiliation with this subject.