Do Your Employees Work From Home?

Working from home, or telecommuting, has evolved from a rare and special privilege granted to only a select few, to a regular occurrence for normal employees.  If your business is the type that would permit your employees to telecommute either part or all of the time, make sure your business policies are equally up-to-date and address the issues that could arise.

Working remotely has obvious attractions for both employees and employers, often for different reasons, but  be ready to be flexible.  Your office polices will definitely need to be updated to reflect the situation and you need to be prepared for both the successes and failures that come with telecommuters.

Develop an Appropriate Remote Work Policy

Some employers develop remote work policies out of necessity, for example when a key employee relocates or has a personal situation arise that requires them to spend less time in the office.  Keep in mind, however, that developing a policy as a reaction to circumstances is not ideal – it is much better to plan ahead. And remember all of the aspects of moving an employee to an out-of-the-office worker: IT issues, tax issues, insurance, privacy concerns, and a clear, evenly applied remote policy.

There is no reason to fear telecommuting.  In fact, the ability to work remotely is generally viewed as a benefit by employees. Offering telecommuting to employees often means you can retain key people in your organization and your business as a whole becomes more attractive to potential employees. It is also important to remember that the Equal Employment Opportunity Commission argues that, on occasion, working from home must be considered as a reasonable accommodation option, even if the employer has no existing telecommuting program. However, all this means is do not say no to a remote working arrangement before you analyze the options.  Importantly, federal courts of appeal have concluded that regular, on-site attendance is often an essential function of many jobs and, in those circumstances, an employer is not required to offer the employee the option to work at home.

Questions You May Not Have Considered

Working remotely may permit the employee’s work location to be in a different state from the employer’s business, such as here in South Jersey, so close to the Pennsylvania border. You must determine which state laws will regulate the work and to which state the employee will owe taxes. Be careful! New Jersey is a state that insists remote activity requires an employer to pay state corporate taxes. The employer should also clear remote work activity with local zoning laws or property restrictions which may either inhibit or ban commercial activity in the employees’ homes.

I Do Not Want to Pay My Employee to Sit Home and Watch Netflix

Compensating non-exempt employees can be the most challenging aspect of tackling a remote work policy.  Usually work is measured and compensated by time – the amount of hours the employee is in the office.  Time in the office is easy to measure and monitor with supervisors, a time-clock or computer log in records.  An employer who wants to rely on more than a telecommuting employee’s say so must get creative and develop technological methods to substitute for the traditional time clock, such as a computer log-in records. There will have to be a level of trust developed and certainly the work product output should have relation to the hours logged.

What Now?

If you would like to explore a telecommuting policy to offer your employees, give us at Bergmann & Good a call to discuss the options.

 

Why Would I Use a Lawyer to Form an LLC?

Your accountant has recommended that you operate your business in the form on an LLC.  You go online and see the New Jersey state website makes filing the formation documents online very easy.  So why bother with an attorney?

Well, if you are both familiar and comfortable with the New Jersey Revised Uniform Limited Liability Company Act (“RULLCA”) then by all means, plug in your name, address and credit card number and save yourself a few dollars.  However, if you are not familiar with the revised statute then perhaps a consultation and creating a business that works best for you is the way to go.

The most significant difference between forming your LLC on your own and forming your LLC in consultation with counsel is that on your own, without an operating agreement, your LLC will be governed by the existing statute, or RULLCA.  For instance, under RULLCA, an LLC’s operating agreement may eliminate or limit a member’s or manager’s liability to the LLC and members for money damages, except for (a) breach of the duty of loyalty; (b) a financial benefit received by the member or manager to which the member or manager is not entitled; (c) a breach of a member’s duty to not consent to or receive any distribution from the LLC if the LLC is insolvent or would become insolvent as a result of the distribution; (d) intentional infliction of harm on the LLC or a member; or (e) an intentional violation of criminal law.

Having an attorney form the LLC and help you draft your operating agreement means you can set up your business exactly as you want it, rather than having to use the default rules of the RULLCA. LLC’s offer tax and liability protection whether or not you form with the help of an attorney, but working with a professional business firm maximizes those protections and makes formation costs well worth the price tag. Questions? Call Bergmann & Good.  We are here to help.

Make Room on Your Business Team for Debby Downer

Every small business should start with at least three essential outside team members: a small business accountant, an experienced commercial insurance agent and a small business attorney. Just as you should not wait to look for a lawyer until you’ve been sued, 10 months into your new business venture is also not the time to search for an accountant.

Needless to say, after the pipes burst is not the ideal time to start looking for your insurance agent, and no one starts looking for an account the day after their taxes are due, so why wait to look for a business attorney?

Everyone remembers Debby Downer, the Saturday Night Live character who just loves to bear the bad news.  As a business litigator, I think we have something in common.  Considering all the downsides is just as important as the upsides to the day-to-day operations of your business.  There is a lot the small business owner should know and it is much easier (and less expensive) for you to learn from the mistakes of others.  Your business attorney, or Debby Downer, probably has lots of stories about things gone wrong.  People work with people whom they like and trust and I would like to think we here at Bergmann & Good are a bit more fun to be around than Debby.  Take your business lawyer’s advice and listen to the war stories.  Don’t be at the center of the next piece of avoidable litigation.

Take the time to interview an accountant, a lawyer and a commercial agent before you take the deep dive into the world of small business.  Civil litigation is not something any new business can afford and not being properly insured can put you out of business quickly.  What I hear most often from established small business owners is: “I’ve been in business for 20 years and never been sued.”  That’s fantastic, but what if you were sued?  Court imposed response timelines are tight and scrambling for counsel, even against frivolous claims is very time-consuming.  Would you feel better working with something who knows not only you, but the internal workings of your business rather than your Uncle’s neighbor, Jan, a divorce attorney?

The best use of a your small business attorney is as a partner to guide and protect you in all aspects of opening, running and even selling a business–before you’re faced with legal issues.  Pre-litigation counseling is a much better use of your resources, rather than hoping you never need to hire an attorney.

Some areas a business attorney can guide you through include:

  1. Contract and/or lease negotiation and review;
  2. Developing employee, office and business policies for recruitment, hiring, discipline and termination;
  3. Creating non-compete and confidentiality agreements;
  4. Business succession planning;
  5. Creating and protecting intellectual property;
  6. Regulatory compliance;
  7. Banking and finance law;
  8. And, of course, litigation.

Small business owners dread the idea of dealing with lawyers because they assume the business cannot afford it.  Lawyers are expensive. For this reason many business owners simply avoid investing in legal counsel until there is simply no choice.  There are better ways to address this very basic business need.  Simply incorporate an attorney as part of your ongoing business expenses.  Budget for the unexpected litigation, and when it never happens, your end-of-year bottom line will be better than expected.  Once you develop a relationship with a business attorney, there are many things than can be resolved via a fixed fee, which of course, allows the small business owner certainty and the ability to budget for necessary work. By having an ongoing relationship with your very own Debby Downer, including basic litigation avoidance counseling, you just may avoid the problem altogether.