How ‘Working at Home' became an employer's nightmare

A loan service company had eight employees. At any given time, it allowed four of its employees to work from home. The employer had a staff of employees who were experienced, dedicated and most responsible. The employer, having confidence in its experienced employees, did not bother preparing any rules or regulations relative to the activities of its employees while working from home. One of its employees, while working from home, allowed a customer to drop off a package of documents at the home of the employee. The customer, unfortunately, fell on the employee’s driveway resulting in permanent injuries to the customer.

The customer sued the employee and the loan service company. The employee tendered a claim to her homeowner’s insurance company. The insurance company denied the claim because the policy excluded claims for bodily injury arising from “business related activities.”

The company also tendered a claim to its insurance company, but the claim was denied because the injury occurred outside of the insured premises.

This nightmare for both the employer and the employee could have been mitigated if certain action had been taken, including the following:

1. The company establishing rules and regulations regarding activities of its employees who are working from home. One of the rules would be to prohibit any customer of the employer from entering upon the property of the employee.

2. The company obtaining an endorsement to its insurance policy extending liability coverage to encompass activities occurring on or about the home of a ‘working at home’ employee.

3. The employee obtaining an endorsement to the employee’s homeowner’s insurance policy to encompass any business activity occurring on or about the homeowner’s property.

In the event you are an employee who works from home or you are an employer who allows its employees to work from home, the attorneys at Chuhak & Tecson are available to review and evaluate potential risks and provide counsel to minimize the potential risks and liabilities.

Client alert authored by Arnold E. Karolewski (312 855 4320), Principal.

This Chuhak & Tecson, P.C. communication is intended only to provide information regarding developments in the law and information of general interest. It is not intended to constitute advice regarding legal problems and should not be relied upon as such