Companies may have to reconsider employees' use of personal phones for work purposes in light of a California appellate court ruling requiring reimbursement.
The state Court of Appeals decided that businesses must pay a "reasonable percentage" of the phone bill, if employees' jobs require the use of their phones.
Failure to reimburse could be grounds for employees to file a class-action lawsuit.
Companies in California that have so-called BYOD (Bring Your Own Device) programs should start reviewing them for compliance with the court decision, which remains the law unless it is appealed to the state Supreme Court.
But dumping a BYOD program altogether may leave unhappy employees.
"Data tells us that people are so attached to their mobile device that it becomes a part of their persona," Steve Coco, a human resources management consultant with Buck Consultants, a Xerox company, said.
5 tips to improve BYOD expense management, compliance.
In fact, new hires allowed to keep their phones and apps tend to become more productive faster than workers with company-issued phones, Coco said.
Handing employees a phone with a corporate wireless plan is the easiest way to comply with the ruling, experts say.
Here are five items to consider in deciding the changes necessary to stay out of legal trouble. And companies in all states can benefit from keeping tighter tabs on BYOD use.
1. Create a sound device policy. Whether employees are allowed to use their own phone should depend on how well that would fit into the company's overall telecommunication strategy. CIOs must decide whether BYOD or company-issued devices are a better fit for how the business handles security, enables network access, approves the use of apps and handles equipment support.
2. Consider a corporate billing plan. A company can have one wireless plan for all employees and receive a monthly bill from the service provider. That way, the organization is in a better position to monitor phone use and seek reimbursement from employees for non-work activities.
3. Pay a percentage of the bill. Another option is to reimburse a percentage of an employee's bill, based on a reasonable estimate of work-related activity on the phone. Be generous to avoid a legal challenge, but monitor the overall cost, which could end up being more than if the organization had a corporate plan for all employees.
4. Company-issued phones. Handing out phones and paying for the wireless plan is the simplest way to meet the requirements of the law and simplify cost control. The advantage is less administrative overhead, full control over phone usage and leverage in negotiating pricing with wireless carriers.
5. Avoid dealing with each employee's phone bill. Having employees itemize calls, texts and data usage for reimbursement each month would reduce productivity. Also, checking the expense submitted for mistakes would add a lot of work to financial staff without much return.
"Clearly, it would be an administrative nightmare," Katherine Jones, vice president of HR research at Deloitte Consulting LLP, said. "And your employee would be spending all his or her time not working."
The BYOD trend has created a niche market for expense management programs from providers like Visage Mobile, Cass Information Systems, Telesoft and others that automate the process of separating personal from work use and billing accordingly.
Gartner predicts half of all organizations will require employees to use personal devices for work by 2017.