California Bolsters BYOD

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This week a California appeals court ruled that employers must cover the costs of employee cell phone usage that are related to work. Courts don’t make rules, they interpret them and in this case they interpreted California Labor Code section 2802. Within the ruling: “an employee need only show that he or she was required to use a personal cell phone to make work-related calls, and he or she was not reimbursed.” 

Most of the media coverage of this ruling suggests its a blow to BYOD – it’s actually the opposite. This is a good thing for UC and BYOD.

  • Pre BYOD – employers provided cell phones to employees. This worked well until the current iteration of smartphones became poplar (about late 200n). The problem was employees wanted iPhones or similar and employers were issuing Blackberries or feature phones. This caused the employee emotional distress and/or introduced the requirement to carry two phones.
  • BYOD became popular and employees could use their own phones for work. Employer got out of purchasing the phones, but BYOD was never really about who was paying for it. In many cases, the employer continued to pay for it via expense reports. In a BYOD world, employers rarely if ever directly pay for the cell phone service – instead the employee submits an expense report or receives a per diem/allowance type model.
  • A hidden cost of BYOD was that a single cellular bill was replaced with potentially hundreds or thousands of expense reports. Not only does the employer lose the ability to negotiate a larger discount, but the cost of processing so many checks can be significant.
  • Of course in many cases the employer never paid a dime. The general rule is employers pay for work-related costs that employees encounter – but it’s always been a gray area. Many things like laundry bills and company cars have largely disappeared as employee covered costs. I can recall paying for a second home line for remote home-based employees  – but Internet access is a tougher sell as it’s assumed that most people will purchase it anyway. Technically it would be acceptable to allocate the home Internet bill and expense a portion of it, but could be interpreted as an audit flag.
  • Sales or field employees are generally straight forward – the problem is the employees that technically don’t require a cell phone to do their work. This is further exacerbated because many people now cut their home line cords. This means the cell phone becomes the primary phone, so of course it gets used for work-related calls even though these may not be an approved/authorized activity.
  • Let’s go back 15 years and give the employee a company pager. We page them and they call from their home phone – no problem. Today, if we did that they might call from their cell phone. The ruling says the cell phone must be reimbursed (but not the home phone).

Pretty confusing, but still this is a good thing

  • BYOD introduces several problems – security, control, privacy, and of course financial issues. The best course is clear policies regarding these matters, but that’s the exception.
  • One of the big features of UC is a Single Number concept where employees make/receive calls on their UC client using their single phone number. Although just about every UC system supports this, few actually use it. Most just give out their cell phone number.
  • Employers don’t like it when employees give out their direct cell phone number because they lose control over the call. If that employee goes to work for a competitor and customers dial the employee’s cell number directly – your customers are now calling your competitor.
  • Employees don’t actually like giving out their cell phone number either – even though they do it. It’s done because it’s easy and more intuitive. The issue is they can’t turn off work calls when they dial the cell phone directly. It’s hard to enjoy a day off if customers/colleagues keep calling. Turning off the cell phone completely is not ideal because it will block friends and family calls as well. A single number service solves this because they can turn off routing to the cell phone during the vacation.
  • This ruling is the impetus for employers to now insist on the UC client. If they make/receive calls over Wi-Fi there is nothing to reimburse. The ruling was specifically about cell phone usage. In other words, expect California companies to now start stating that unless specifically authorized, employees are not to use their personal cell phones for work. Employees that download and install the UC client on their devices are free to make/receives calls as much as they want over Wi-Fi services.
  • Because employees will now know they can’t get reimbursed for their minutes (without specific/explicit permission) they will refrain from using their own minutes (oh yeah, take this). They will likely now install and even insist on the mobile UC client.

BYOD is not going away – it’s very practical and desirable for many reasons. The reality is employers and employees need to be on the same page about how to communicate in our highly mobile world. The general answer will become be via UC clients, and this ruling will help. It will drive clarity and motivation regarding acceptable use and adoption for enterprise mobility.

Special thanks to:

Hyoun Park – Data Hive Consulting for talking me through this
See coverage by Larry Seltzer and David Weldon .

Dave Michels