When the COVID-19 pandemic hit in 2020, many employers pivoted to a work-from-home model. Though initially seen as a temporary measure, two years later, work-from-home (WFH) has become a permanent feature for many companies.
While the change comes with many positives for employees and employers alike, it also changes important aspects of the overall risk and liability profile. It is important, then, that employers reevaluate their business operations and make sure their insurance is adequately addressing their current exposures in this new, remote environment. Some key coverages and considerations affected by the shift include:
Employment Practices Liability (EPLI)Video conferencing is not new, but in an age of WFH, it’s ubiquitous. With increased use comes the likelihood of an incident, such as an employee or manager saying something inappropriate on a Zoom session.
In this instance, the rules of an office are the rules of the office no matter where the physical office is located. The policies and procedures in an employee handbook apply whether working in an office or at home. The physical structure may look different, but employees are still part of the same company culture and have agreed to conduct themselves accordingly. Still, details – and fine print – matter. Ensuring an EPLI policy is not limited to “onsite” behaviors is essential.
Also, many people are working more hours as easy access to a home office and computer blurs the line between on and off the job. Employers should be mindful of the hours they are asking nonexempt employees to work and the possibility of violating the Fair Labor Standards Act (FLSA) if they fail to pay overtime to nonexempt employees. A wage and hour insurance coverage endorsement can may be added to your EPLI policy to defend claims in this situation.
Workers Compensation
Location can affect this coverage and with many employees working remotely, workers compensation coverage should be re-evaluated. Claims procedures follow the laws where the employee is located, not where the company is based. Employers should therefore ensure their workers compensation coverage extends to any state in which employees are working to protect against claims made.
Cyber
Outside of a traditional office setting, many are less cognizant of the fact they can be the target of a cyber-attack. People juggling both home and professional responsibilities, become more careless, and therefore vulnerable.
To counter this tendency, it is important to reinforce education and do consistent training with employees to maintain awareness of cyber security and best practices. Using real life examples that employees can relate to will help keep cyber exposure top of mind and minimize claims.
Crime
Employee dishonesty has increased since the start of the pandemic and with employees having access to business accounts while from home, it’s more important than ever to make sure you have safeguards and procedures in place to minimize the opportunity for a financial loss. These can include auto-alerts for large check amounts, two-factor authentication for bank accounts, counter signature requirements, quarterly reviews, and frequently changing passwords. In the event an employee does steal, crime or employee dishonesty insurance can help recover the cost of inventory and revenue resulting from the theft.
While the shift to a remote work has saved companies on expenses, including building leases, office furniture and utilities, those savings could be lost in an avalanche of claims if their changing risks aren’t properly covered. Evaluating insurance needs today can protect the new future of work and the bottom line.
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