How Regulation is Stifling Distributed Work (and what needs to be done to fix it)

February 24, 2021

US employment laws are written for the traditional workplace. They’re written for companies where employees go to an office from 9-5 Monday to Friday. Where workers work at a designated workspace on company equipment, with set breaks and set work hours. But this is no longer the reality for the many businesses. So many moved (quite quickly) to work-from-home arrangements when the pandemic broke out. And it doesn’t look like it will be the reality going forward either. 

Telecommuting has been growing for years.

The pandemic sparked a monumental shift in the number of people working from home. But, telecommuting was growing in popularity before the pandemic. In fact, between 2005 and 2017, there was a 159% increase in the number of people working remotely

And it shows no sign of slowing down…

Now that more US workers (and employers) have realized the benefits of working offsite, most don’t want to return to the office full time. 55% of respondents to a recent survey said they would prefer to work-from-home at least 3 days per week going forward. It’s estimated that the number of remote workers will double (from pre-COVID rates) by 2025

And why not? The business benefits of flexible workplace arrangements are incontrovertible – and include: 

But regulation is stifling distributed work.

The laws that govern workplaces are (necessarily) intricate. The legal landscape for employers spans labor laws, workers’ compensation and health and safety, harassment, hiring and firing, and more. 

But all of these laws are written to govern workplaces that people physically go to during their work hours. Not workers who are working from home – or wherever else they’d rather be. 

Regulation of remote workers and telecommuters

Let’s consider an employee’s right to a safe workplace.

Under federal law, employer responsibilities include that it must:

  1. Develop and implement a written plan where hazardous chemicals can be found in the workplace.
  2. Examine workplaces to ensure that they are safe and compliant with OSHA standards. 
  3. Post the OSHA poster prominently within the workplace. 

These obligations make a lot of sense in a traditional workspace, but significantly less in a distributed setting. Imagine the burden of examining the home workspace of each of your employees. Or implementing written plans to mitigate the risks associated with employees cleaning their workspace with strong chemicals. 

Moreover, it’s difficult to manage workplace risk management without infringing on worker rights within their own homes. 

Health and safety policies banning guns from the workplace don’t reflect the realities of employees working from home. Similarly, flexible workplace arrangements make workplace policies that prohibit cannabis complicated. There are a growing number of states that have legalized medicinal and/or recreational use of cannabis, yet it remains illegal federally. Your workplace policies need to reflect this. 

Distributed workplaces face even greater regulatory hurdles.

Fully-distributed workplaces, like CGL, don’t have an office to work remotely from. We hire our employees on the basis of their experience and fit, not where they live. Consequently, our employees are located around the world. Many of them move frequently.

While this business model eliminates the traditional overhead associated with office spaces, the regulatory red tape associated with running a distributed workplace is staggering.  

Hiring employees who live in different states can be difficult to navigate. Our workplace policies are complex. Even interviewing candidates from different states come with different regulations. 

So, we’ve hired a HR firm to reduce the burden of complying with the various laws. 

Whatever Happens Next: Education is key. 

The pandemic aside, the world is getting increasingly smaller and workers are flooding to flexible workplace arrangements. More than this, flexible workplace arrangements work in favor of diverse workers. Many states, California included, and the federal government, are working to increase diversity in our workplaces – largely as a result of the significant business and social benefits associated with doing so

Yet, federal and state policymakers don’t have a firm grasp on the realities of a distributed workplace – or how regulation is stifling distributed work. The laws that govern work from home arrangements aren’t fully developed either. If we’re going to make flexible work achievable and sustainable in the longer term, businesses need greater certainty – and that will only come from regulators developing a framework geared towards our new and emerging reality. 

Education is going to be key in achieving that.

Noam with her child working from home on her Macbook


The materials available at this website are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this website or any of the e-mail links contained within the site do not create an attorney-client relationship between CGL and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

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