Smart Phones Require 'Smart' Employers

In the bricks-and-mortar business world and its e-counterpart, executives and rank-and-file employees alike carry smart phones. Smart phones ' cellular phones with advanced capabilities (such as BlackBerrys and iPhones) ' are invaluable tools for many employees.

e-Commerce employers must be especially “smart” about employee smart-phone use and the problems it can bring if acceptable use isn't spelled out. Unfortunately, few employers fully consider the various issues these high-tech gadgets pose, such as overtime compensation dangers, security risks and offensive blunders in etiquette.

Points to Ponder

e-Commerce enterprises aren't exempt from the need for these policies, despite their phone users' and managers' tech savvy. In fact, they may need these policies more, given gadget-users' proclivity to use such devices and due to the nature of the online business world and the increasing ability to conduct actual business from such devices.

To avoid potential problems (including legal liability), companies should consider issues related to employees' smart-phone use, and, if necessary, draft and revise employment policies.

This article addresses six issues that every employer should consider concerning employees' smart-phone use.

Focus on After-Hours Smart Phone Use By Non-exempt Employees

If an employer expects or allows employees who are not exempt from the Fair Labor Standards Act (“FLSA”) to use smart phones for business purposes after working hours, then the employer could run afoul of overtime compensation rules. The FLSA requires a non-exempt employee to be paid for work performed off the clock, even if the employee voluntarily performed the work. At the time the FLSA was drafted, “work” was more easily defined. Now, an employer must question whether asking a non-exempt employee to quickly respond to an e-mail after hours constitutes “work.”

Some managers may scoff at this because an employee's time spent responding to e-mails is likely de minimus and possibly even offset by company time the employee “wasted” by sending personal e-mails from the office. But others, including plaintiffs' attorneys, disagree. Already, non-exempt employees have filed lawsuits seeking overtime pay for after-hours work performed on smart phones. For example, in one case, the plaintiffs allege that their employer required them to respond to work-related e-mails, text messages and phone conferences outside the normal workweek, and without compensation. See, Agui v. T-Mobile USA Inc., No. 09-2955 (E. Dist. N.Y., July 10, 2009).

The lesson here is clear: When creating smart-phone policies, employers should anticipate and address overtime compensation for non-exempt employees. To be completely safe and to avoid any overtime compensation issues, an employer should not distribute smart phones to non-exempt employees and should not allow non-exempt employees to access company data via personal smart phones.

If a company does assign smart phones to non-exempt employees, however, then the employer must establish clear guidelines regarding after-hours use. At a minimum, an employer should delineate the times that an employee should and should not respond to messages and telephone calls. A stricter policy could require employees to leave smart phones at the office or to disable them during non-working hours. Significantly, even though an employer can terminate an employee for violating company policies, an employer cannot avoid compensating an employee for the time the employee worked.

If an employer plans for a non-exempt employee to complete work after hours via a smart phone, then the employer should establish a system to capture the time the employee works (perhaps by using a smart-phone application) and should compensate the employee at the proper overtime rate. Additionally, an employer must educate its managers about its policies and explain how contacting non-exempt employees after working hours could have legal implications.

Employers Should Address
Accessibility Expectations for Exempt Employees

For employees exempt from the FLSA's overtime compensation requirements and their employers, smart phones present a complex dichotomy. A smart phone may enable an employee to sneak out early to catch a kid's baseball game, while remaining accessible should a client or co-worker need assistance. But, if an employee feels relieved of the need to come into the office because the employee is accessible via phone, the employee's productivity may drop and the morale of those employees without this freedom may weaken.

Conversely, smart phones may prevent employees from ever truly escaping the office's demands. Many smart-phone users report feeling “always on” and tied to their devices, even during leisure time. Smart-phone users are notorious for compulsively checking their phones; the term “crackberry” aptly describes many BlackBerry users, and iPhone users are similarly compulsive.

To help employees achieve a better work-life balance and to bolster productivity and morale, an employer should address its accessibility expectations for exempt employees. First, the employer should clarify to what degree accessibility via smart phone is a substitute for presence in the office. Second, the employer should evaluate its response-time expectations for smart-phone users and communicate those expectations to employees. By defining its expectations, an employer enables its employees to be alert and available when needed, and to relax at other times.

Employers Should Try to
Prevent Etiquette Blunders

Unfortunately, some employees abandon common sense and proper training when it comes to appropriate smart-phone use, and employers must remind these employees to be mannerly. An employee's failure to exercise courtesy can lead to unexpected and negative consequences, including lost business and liability for a hostile work environment. Clients and co-workers alike want to feel valued and important, but an employee cannot convey this message by paying more attention to a device than to the conversation at hand. Moreover, potentially offensive jokes or remarks ' although always problematic in a workplace ' are even more so when preserved via smart-phone technology.

Proper meeting etiquette should top an employer's concerns. How many meetings have you attended lately in which all participants sat with their heads bowed, looking in their laps? Typing under the table fools no one! Often, smart-phone users are not even conducting more important business, but are merely commenting to each other about the presentation. These employees not only miss meeting content, but also risk insulting the speaker.

Different meetings, however, may require different rules. For meetings with clients or customers, employees should be instructed to silence their smart phones ' period. Few issues are so critical that they cannot wait for a meeting to conclude or, at the least, for a meeting break. And, few things can upset a client or customer more than feeling like a low priority during a face-to-face meeting. If an employee is truly concerned about missing an important e-mail, the employee can program his or her e-mail account to send an automatic reply indicating when the employee will be available and naming an alternative person to contact if immediate assistance is required. While an employer may wish to enact a more lenient policy for internal meetings, employees should still be asked to turn off their phones and to put them away. If an employee must take a call or respond to an e-mail, the employee should tell the speaker or meeting organizer in advance, and should quietly exit and close the door prior to responding.

The informality associated with messages sent from smart phones prompts a second etiquette concern. Typing on a tiny keyboard is difficult, so users understandably resort to abbreviations and short phrases; however, no one appreciates receiving an e-mail replete with misspellings and odd abbreviations, or one that requires significant time to decipher. Also, employees often regard e-mails (especially those sent from smart phones) as casual, conversation-like communications rather than as written records akin to business letters. Consequently, an employer may need to remind employees to treat smart-phone e-mails like formal business correspondence in tone and style, and to initiate a face-to-face conversation or a telephone call if the topic involves a sensitive subject.

Finally, the same rules regarding general workplace harassment apply to smart-phone use. Employers should not tolerate workplace harassment in any form and should caution employees to avoid texting or e-mailing harassing comments to others.

Employers Should Try to
Minimize Security Risks
Presented By Smart-Phone Use

Despite its small size, a smart phone can contain enough sensitive company information and contacts to fill a small storage facility. While an employee may enjoy carrying a virtual filing cabinet around in his or her pocket, if a smart phone falls into the wrong hands, it could lead to a massive security breach. Imagine that a law-firm associate leaves a smart phone in a restaurant booth. The next patron to sit down (inadvertently or not) may read attorney-client communications, attorney work product and even confidential trade-secret documents previously e-mailed to the associate.

To avoid such security breaches and to protect sensitive documents from disclosure, an employer should control the applications and data that can be downloaded onto a smart phone. An employer should also require smart-phone users to protect company information and e-mail accounts with hard-to-crack and frequently updated passwords.

Employers Must Address
Personal Use of Company-issued Smart Phones and
Business Use Of Personal Smart Phones

Most employers allow incidental personal use of company-issued smart phones in the same way most employers allow incidental personal use of the company's landline telephones. Doing so may avoid the enforcement issues inherent in a policy that prohibits all personal use. (Although “excessive personal use” may be difficult to define, an employer may find it easier to discipline one employee for sending 100 personal e-mails a day than to discipline 30 employees, all of whom violated a zero-tolerance policy in varying degrees.) For this reason, an employer may wish to enact a smart-phone personal-use policy that parallels the company's landline policy.

Regardless of an employer's personal-use policy, an employer should inform employees that they should have no expectations of privacy and that all company-issued smart phones remain subject to monitoring by the employer. By requiring employees to expressly confirm that they understand that the employer may access its phones at any time, an employer may avoid disputes and simultaneously ensure that contraband applications and inappropriate content are not installed on company-owned smart phones.

An employer must also determine whether to allow employees to log into company e-mail accounts and to access company data via personal smart phones. Granting this access raises huge security concerns because an employer cannot truly control any devices that it does not own. No doubt, the safest policy would restrict access to those who carry a company-issued smart phone.

But if an employer does allow employees to access company data via personal smart phones, the employer must determine how and to what level it will assert control over the smart-phone user, such as by requiring employees to run antivirus software or to encrypt data. An employer must also determine whether the company's information-technology team will support user-owned smart phones. While a policy of no support may leave employees in a bind, an information-technology department should not devote countless hours to supporting personal devices. Many companies strike a balance by creating a “best efforts” policy: the information-technology team will attempt to fix user-owned smart phones, but will spend no more than “X” minutes doing so.

Employers Must Be Aware of
Road Safety Issues

Texting or e-mailing while driving may be as dangerous as driving while intoxicated, yet employees frequently send business-related e-mails while on the road. To avoid potential liability to others and to protect its employees, an employer should forbid employees from conducting business while driving or require employees to use hands-free headsets.

Final Thoughts

As with any employment policy, an employer must educate its employees about its smart-phone policies. Equally important, an employer must uniformly enforce these policies and must not allow informal, competing policies to develop. And, given smart phones' ever-evolving technology, an employer must remain flexible and be willing to revisit and revise its policies as needed.