Think Twice Before Handing Out Smart Phones to Your Employees

Think Twice Before Handing Out Smart Phones to Your Employees If you are a small business owner and you have non-exempt employees on staff, beware. There’s a danger lurking that makes sense but almost no one saw it coming.

If you are a small business owner and you have non-exempt employees on staff, beware. There’s a danger lurking that makes sense but almost no one saw it coming.

Going mobile

The trend has long been for companies – especially technology-based companies – to hand out laptops and mobile phones to their employees. Desktops are become archaic – except in the case of graphic artists and employees who are generally chained to their desk all day long and never work remotely or at customer sites.

But things are changing. Companies aren’t just handing out mobile phones. They’re providing their employees with smart phones and PDA devices. These devices can browse the web, send text messages, record video, and of course – send and receive email.

All access

While this sounds incredibly productive from a business standpoint – and it definitely is – it is also a danger. It has turned employees into potential 24/7 workers. If the boss needs to get in touch with an employee at 10pm, he sends and email or sends a text message. Clients? They have nearly round the clock access to your employees if there’s a critical project going on. Sounds great, right? Not necessarily.

The issue at hand is that there is a category of employee that is considered non-exempt. The type of work they perform, not their specific job title, determines their non-exempt status. These are the employees that do not fall into the areas of Professional, Administrative or Executive employee. And if you’re issuing iPhones, Blackberrys, Google phones and other similar devices to these employees then beware that the 24/7 access you (as the boss) and your clients enjoy may end up costing you in the way of overtime.

The potential danger

After-hours usage of these devices for work related purposes is convenient for both sides and it is skyrocketing. These employees are eligible for time plus one-half of their hourly rate for every hour they work over the normal 40 hour work week. Reaching out to these employees any time of the day or night is both productive and convenient, but it can present you with a dangerous and costly overtime issue. This constant availability via these devices means that your employees are basically working outside the regular 40-hour work week if they’re using these devices to respond to customers, co-workers, and managers.

What makes this even more of an issue in terms of litigation – should it become a legal issue – is that the communication method used on these devices lends itself well to time and date stamping and tracking. Calls, text messages, and emails are all trackable – even long after they’ve been deleted from devices. With this traceability, if there is a debate, employees can prove they were working during off hours by merely referencing the date and time stamps on their communications.


There’s no easy solution because this is definitely a trend that will continue long into the future. We don’t really want to stifle our employees’ commendable work ethics in going the extra mile for clients late at night and on weekends. We also like to have them available to us in case there is a critical need.

However, consider this a warning. Proactively incorporating good business practices and policies now concerning after hours usage of these devices and how to charge and track time may protect your organization in the future should a dispute arise. You don’t want to find yourself in court defending your company against thousands of dollars in unpaid overtime claims with no documented policy in place.

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