Work/Life - Office/Home - Day/Night: 
Compensating the Workplace "Slashes" of the Future

By Gil E. Gordon

(Note: This article appears in a special issue on work/life of the American
Compensation Association JOURNAL.  Copyright (C) 1998, American
Compensation Association.  All Rights Reserved.)


Once upon a time, life was simpler.

Virtually all "office work" was done where it belonged - in the office, of
course.

Certainly, people took work home in a briefcase from time to time and
commandeered the kitchen table after the dinner dishes were cleared. They
caught up on their mail (translated: went through a manila folder full of
papers), reviewed their upcoming schedule (translated: flipped the pages of
their appointment book), and perhaps reviewed the budget (translated:
spread out a spreadsheet, i.e., a green-tinted, doublewide, multi-column
piece of paper). If they were really ambitious, they drafted a few memos or
a report (translated: filled up a few pages of a legal pad with handwriting
that, with luck, was decipherable by a trusted secretary).

That trusted secretary might have handed our "home worker" his (and it
almost always was a "he") phone messages (translated: a stack of pink
"While You Were Out" slips) before he left for the day, but this was mostly
for curiosity. There was no reason to try to deal with those messages;
nobody was in the office in the evening, and if you tried to return a call,
the phone would just ring, and ring, and ring.


How Soon We Forget...

That little scenario from the Dark Ages actually is not as ancient as we
might think. It was, in fact, a fairly accurate description of the
situation in the early 1980s. "Voice mail" was just barely coming onto the
scene, a few IBM personal computers were starting to appear, and Visicalc
was the spreadsheet software of choice for a select few.

How does this compare with corporate life today?

There are, by various estimates, somewhere between 9 and 15 million
salaried corporate telecommuters in the United States who spend at least
one day per week working at home during normal work hours.

A computer is no longer something that fills a big, air-conditioned,
double-locked room; it is something that most people carry in their
briefcase, if not their pocket.

After decades when parents dutifully relocated to new cities at the drop of
a hat, and missed countless birthday parties or cut short family vacations,
today's workers are renegotiating the "work comes first" rules or rejecting
them entirely.

The concept of a "regular, full-time, permanent employee" is almost
extinct. Instead, the work force is populated with an ever-changing mix of
workers in odd categories such as "flexworkers," "job-sharers," "free
agents," "9/80 compressed week workers," and others.

The word "mail" is almost always preceded by "voice" or "e."

And, anyone who spends most or all of the work week stationed in his or her
office with four floor-to-ceiling walls and has a dedicated secretary
stationed outside is either among a handful of senior executives or utterly
out of touch with the work force and work place of the late 1990s.

In short, we have seen dramatic, unprecedented, and (to some) unsettling
changes in the nature of work, workers and the work place itself. Like it
or not, the "good old days" are long gone. 

The good news is that the new workplace has, in most cases, created changes
that are for the better. The less good (but not bad) news is that many of
our work-place systems, policies, and practices have not kept pace with
these changes. This article will refer to some of the trends we're seeing
today, while focusing on one change in particular, and suggest some
implications for compensation and benefits professionals to consider.


Changing Work and Workers vs. Changing Workplaces

The before-and-after contrasts noted above run the spectrum from technology
and office design, to work schedules and HR practices. We have seen, and
continue to see, overwhelming changes in what people do, who those people
are, and where they do their work. 

It is this last change in work location itself that seems to me to be the
most profound. It's one thing to change from a paper spreadsheet to an
Excel spreadsheet, or to change from a full-time, predominantly male work
force to a much more diverse one. But, it is significantly different to
consider changes in the "office" part of office work that we have taken for
granted.

In fact, the deconstruction of the term "office work" is at the heart of
many changes we are seeing. This results from the explosion of hardware,
software and telecommunications technologies that are shaking up the
workplace of the last 300 years. 

This is the first time in the history of the workplace that we can separate
activity from location. In the Agricultural Age, we had no choice but to
bring all the workers to the workplace; that's where the dirt was. In the
Industrial Age, we had no choice but to bring all the workers to the
workplace; that's where the machinery and assembly lines were. But now that
we're in the Information Age, we do have the option of separating what
people do from where they do it.

As we begin to do this, it is essential to consider some of the obvious
(and less obvious) implications for HR issues in general, and compensation
and benefits concerns in particular.


It's the Same - But Different

When an employee starts telecommuting (which in most cases means working at
home one to three days a week), the only thing that changes is the work
location. Pay, benefits, employment status and all other company and
regulatory protections and entitlements are unchanged. 

Some employers have tried to use the shift to telecommuting to justify a
shift from employee to independent contractor status for telecommuters
which, in most cases, is done to avoid benefits costs and coverage. The
IRS, not surprisingly, has taken a dim view of this change. Though the
whole issue of employee vs. independent contractor status is under
legislative review, employers should tread carefully when contemplating
this shift from the world of the W-2 to the 1099.


FLSA Doesn't Go Away

There is no reason why a non-exempt employee cannot telecommute, as long as
all existing requirements for work hours, time recording, etc., are met, as
they would be if the person were in the office full-time. Some employers
argue that the work hours and schedule for a telecommuter at home can't be
monitored and verified as they are in the office. That's true, but it's
also true for the thousands, if not millions, of non-exempt workers (e.g.,
installers, service reps, health care aides, and more) who worked away from
the workplace long before the word "telecommuting" came into our
vocabularies.


Are We Paying for Presence or Product?

This is the million-dollar question: are exempt employees paid for the
hours they put in or the work they turn out? And, if they're able to do
what would have taken a full day in the office in less time working at
home, who "owns" those extra hours? The essence of telecommuting is that
the results count much more than the activity that led to the results. It
really doesn't make much difference, for most jobs, when you start and stop
work, or how many lunches you miss.

This thorny issue leads to all kinds of interesting and complex discussions
often bordering on philosophical debates. As with many telecommuting
issues, the attempt to resolve these questions, as they apply away from the
office, inevitably leads to some long-overdue discussions about these same
issues in the office.


Is It Time to Revisit Piece Rates?

One way out of this dilemma is to consider an updated approach to piece
rates, or more broadly, pay-for-performance plans. Even though most
telecommuters don't work in unit-measure jobs that lend themselves to
tracking hourly or even daily output, there are still possibilities for
measuring and rewarding extra effort.

The reason this is relevant to telecommuting more so than in the office, is
that it is generally easier to do office work via telecommuting than in the
office. The old joke is that "the hospital is a terrible place to get
well," and an updated version is that "the office is a terrible place to do
office work." The gains in output, quality and multi-tasking that are
common for telecommuters are almost always due to being in an environment
that is more conducive to concentration, with fewer distractions and
interruptions. If the results are markedly better than what we've come to
expect in the office, might it not be wise to ask whether the compensation
should reflect that change?


How Broad is the "Compensation" Package?

Almost all employers provide almost all the "tools" for telecommuting - the
computer, the phone lines, the software, the office supplies, and so on.
Far fewer provide furniture, but a growing number are offering a one-time
stipend for home-office set-up costs. For example, several of my clients
have written checks for $500 to $1500 (often grossed-up) to cover the costs
of anything from buying a desk and chair to putting a fresh coat of paint
on the spare-bedroom-turned-home-office walls. Ongoing household expenses
(heating, cooling, electricity) and commuting expenses are not covered,
however.

Consider this logical extension of those expense policies: what if the
employer gave telecommuters a catalog of home-office "supplies" in the
broadest sense - everything from furniture and filing cabinets to scanners
and stereo systems? Since we know that telecommuters sometimes have their
own furniture or computers, or have unequal needs for extra phone lines or
new rugs or paint jobs, why not give them dollar-based credits toward
purchases from a wide range of products and services? 

This is like incentive and recognition programs in which employees earn
credits that can be used to order from a catalog. Instead of trying to come
up with the single best uniform policy or equipment package that fits
everyone (and thus by definition, probably fits no one perfectly), it may
make more sense to let the employee, not the employer, do the choosing.


Should We Rethink Vacation Pay?

As long as we're opening up the issue of broader compensation packages,
let's go as far as to challenge one of the most sacred tenets of benefits:
service-related vacation allotments. The original intent of paid vacation
was to reward loyal workers for their longevity, and to give them a break
>from what had been the demanding and tiring existence in the factory era.

As more work shifted from the factory to the office, we of course retained
the vacation benefit and even enriched it. Over time, most employers have
begun to grant more vacation time for less service time. But if the
intention of paid vacation is to give workers a respite from the workplace
(in this case, the office), what happens when the worker telecommutes and
might not need to get away from the office in the same way?

Paid vacation is an escape not only from the stresses and strains of the
work itself, but also from the commute to and from work and the pure
aggravation of working in a noisy, interruption-driven work environment.
Telecommuters working at home a few days a week spend less time in (and
getting to and from) that environment, so perhaps they don't need quite as
much time away from it.

This may not be the most popular suggestion. Perhaps the only thing more
sacred than the paid vacation is the number-one rule of benefits
administration: it's almost impossible to take back a benefit that you have
already given. Perhaps the best approach then would not be a unilateral
takeback, but a subtle shift to the cafeteria model that has been adopted
for other benefits, in recognition of the diverse makeup and needs of the
work force. Let's say, for example, that telecommuters were given the
option of trading up to 25 percent of their vacation allotment for cash,
near-cash, or non-cash benefits. Many would probably jump at the
opportunity, and those who did not could still get their three weeks after
five years.


Carbon Paper to Copiers - Offices to "Officing"

In the late 1930s, Chester Carlson began showing his new invention called
"xerography" to business executives. Rudimentary as it was, there was no
doubt he had found a way to make extra copies of an original without
resorting to messy carbon paper. Yet, in many cases he was met with the
response, "Why do we need it? We have carbon paper."

The need to have copies did not go away; Carlson was simply trying to offer
another way to generate those copies. Similarly, not all the technological
wonders of this decade, coupled with the employee-driven shift to a
workplace that better balances work and personal needs, eliminate the need
for the office. It will be a long, long time before our downtowns become
ghost towns because everyone is working at home. In fact, it probably will
never happen. What will happen, however, is a subtler shift; our focus will
change from the office as a place, to "officing" as an activity. We will
worry less about where people do their work and more about how much they
do, and how well they do it.

How much work is done and how well it is done are among the concerns of the
compensation and benefits profession. The changes and possibilities
outlined in this article are only suggestive of the kinds of changes that
will follow as offices are decentralize and, in some cases, have employees
working and living under the same roof.


About the Author

Gil Gordon heads Gil Gordon Associates in Monmouth Junction, N.J., and
specializes in the implementation of telecommuting and virtual-office
strategies. He has published the monthly newsletter Telecommuting Review
since 1984, conducted the annual TELECOMMUTE conference since 1992, and his
Web site <www.gilgordon.com>, has become known as the leading worldwide
resource for telecommuting information. Before taking the entrepreneurial
plunge (which landed him in his own home office) in 1982, he spent almost
10 years in Human Resources with Johnson & Johnson.


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