Many companies are allowing employees to work from home to take advantage of cost-savings, an increased talent pool and a better work-life balance for employees, but remote work policies also bring a host of challenges, according to a new executive report from RIMS.

The report, “Risk Management & Remote Policies,” discusses the pros and cons of remote work policies and the role risk professionals should play in their development.

One of the most compelling benefits of a remote work policy is the associated cost-savings. The decreased need for rented office space, parking facilities, furniture and equipment can lead to significant savings. In addition, reduced expenses for commuting, gas, parking and even work-appropriate clothes are savings that can add up for a remote worker. In fact, the privilege to work remotely has become a key selling point for employment, the report said.

In addition, remote work policies allow companies to retain employees who may be unable to keep commuting into the office, according to the report. The presence of a remote work policy also widens the potential talent pool, giving organizations the ability to find and hire qualified people, regardless of their location. The benefit also creates opportunity for candidates who are inhibited by medical or other limitations, the report noted.

But along with the benefits, allowing employees the opportunity to work remotely also presents its share of potential challenges.

“Information technology, confidentiality, employee health and safety, and workers compensation coverage are just some of the challenges that can surface upon introducing remote opportunities to a workforce,” said RIMS Executive Director Mary Roth. “Being in-tune with the organization’s operations and its strategic direction leaves risk professionals well-positioned to contribute to the development of a strong policy that clearly defines expectations for both employees and their managers.”

Most standard remote work policies cover ethics, confidentiality, productivity and specific business area requirements, the report said. There may also be guidelines regarding information technology and acceptable work environments.

“Organizations want to ensure that the employee understands how many hours a day they are expected to work, how often they should check in with the home office, as well as the type of reporting they must provide to their managers,” said Lori Seidenberg, RIMS board director and senior vice president of insurance/risk management for Alden Torch Financial LLC.

• Confidentiality and Data Protection

“Potential loss of data is a top concern to consider when developing a remote work policy,” said Leslie Lamb, RIMS board director and the director of global risk management at Cisco Systems Inc. “Although it is safest to issue technology to employees, it is often not the most cost-effective [method]. For this, and many other reasons, the organization’s IT staff should be involved in the policy development process.”

• Lack of Oversight

Working remotely also presents the risk that employee productivity will suffer, the report found.

“Ideal work-from-home candidates have the type of job that includes productivity measurements that demonstrate that an employee’s responsibilities are being met,” said Carolyn Snow, RIMS ex-officio and director of risk management for Humana Inc. “There would be immediate red flags in certain jobs that would indicate to the employer something is amiss.”

Both employer and employee need to work hard to ensure the work-from-home arrangement is productive. Lack of in-person oversight can lead to miscommunication and failure to meet deadlines.

Frequent communication is important. “Quick check-in phone calls to discuss the status and direction of projects is an effective measure to avert such misunderstandings,” Snow added.

“It takes a high level of trust for a work-from-home arrangement to succeed,” said Seidenberg. “Whether the employee is underworking or overworking, the organization must help their remote workers focus on their goals and objectives, set a consistent pace and acknowledge work ethic.”

• Feelings of Isolation

Working remotely can also leave employees feeling isolated. “Those valuable personal relationships or interactions are absent for remote workers, creating a disconnect between them and the team,” said Seidenberg. To combat this, she recommends establishing a structured communication protocol that includes regular communication—whether daily, weekly, phone or even video meetings.

• Workers Compensation

Workers compensation can be a particular challenge for a company that offers a remote work option. Risk professionals and human resources will need to determine whether or not a medical incident is a result of business activities and might require a workers comp claim to be filed.

Lamb pointed out that even in an office, not all workers comp claims are physically witnessed. “Health risks such as carpal tunnel syndrome, back issues and even a relatively new issue called sitting disease [a medical issue caused by sedentary behavior] will go undetected by others in the workplace but are often covered under workers compensation policies,” she said. “The key to managing these claims for remote workers is to establish clearly defined procedures for reporting health issues and getting them resolved.”

Creating a Remote Work Policy

Lamb recommends establishing a cross-functional team that involves human resources, legal, IT, employee health & safety, facilities and risk management professionals.

A cross-functional team should be set up to ensure:

  • The remote work policy is broad enough to encompass everyone but allows for specific measurable objectives.
  • The policy is properly communicated throughout the organization.
  • No one can change the document or “adjust” the document unless it is approved by the appropriate channels.

Risk professionals need to confirm that the remote work policy addresses potential risks and that it complies with the requirements of the organization’s insurance policies. “If there are inconsistencies between the remote work policy and the organization’s insurance policy, it is incumbent upon the risk professional to communicate these discrepancies to those responsible for its creation,” said Seidenberg.

Every organization will view remote working differently. Companies will have to determine what works best for them by considering both their needs and the needs of their employees. Not all employees have the necessary traits to work from home successfully. Remote workers must be self-motivated, focused, dependable, self-disciplined and able to demonstrate that they can perform at an agreed upon level of productivity.

On the other side of the equation, managers must adapt to a different style of management for remote-working associates. They must maintain frequent contact and include remote workers as part of the team.

A well-defined remote work policy will set expectations and provide guidelines for employers and employees to successfully implement this work arrangement.

The report is available in RIMS Risk Knowledge library at

Source: RIMS Executive Report: Risk Management & Remote Policies