Overview

The work-from-home campaign just got a big push from the current global pandemic. Even before COVID-19 became the trigger, many had advocated for work from anywhere and have been longing to say goodbye to their onerous commute to and from work. India is a country with a humungous population of more than 130 crores, which is second largest in the world. Naturally there is huge pressure on the infrastructure and the environment. Further, lack of balanced development of the country and a huge rural urban divide caused large chunks of population to migrate towards the cities looking for greener pastures. Therefore, there were bound to be clogs in urban infrastructure.

It is interesting to note that for a long time, the employers were trying to experiment work from home (WFH) models, but these were only attempts and no whole hearted initiative was taken due to  many factors.

According to a recent research study at Harvard Business School[1], companies with work-from-anywhere policies, can boost employee productivity; reduce turnover, and lower infrastructure and organizational costs.

A variety of top enterprises and firms, including Amazon, Dell, Humana, Kaplan, and Sales force, have started offering remote working opportunities. However, it is pertinent to note that some of these advertisements are scams and tool used by cyber criminals to dupe the workforce.[2]

Profit or Loss? What is the scenario of different sectors?

Amidst the ongoing nationwide lockdown, when all organizations in the IT sector are engaging their employees in remote work or WFH, a study has revealed that only 0.2 per cent workforce in the IT industry is highly productive. This means that around 99.8 per cent of the workforce in the information technology sector is incapable of working from home and only 0.2 per cent are ‘Work from Home’ champions showcasing high productive attributes, according to the study by research-backed innovative venture SCIKEY Mind Match.[3]

The Industry captains have also been active on social media highlighting changes corona virus crisis is going to bring and how it is making the world hit the reset button.  Some of these changes include stronger digital outreach accelerating adoption of ‘work from home’ model. Further, as per HR experts, while employees are being allowed to operate from home and is seen widely as a humane approach by business leaders, the manufacturing industry in India is not only finding it hard to adopt it, but is conceptually against it as a practice.[4]

Impact on Labourers and Employees

Government’s main focus has always been saving the lives of people. However, in this scenario it has made an attempt to keep the interest of the employer and the employee on an equal footing. Disclosures under SEBI, GST filings, loan repayment deferments (moratorium) and many such relaxations have been announced to benefit the employers. In the case of employees the Government of India, together with the state governments, have issued multiple guidelines and notifications calling upon the employers to abstain from retrenchment or lay-off and to continue providing salaries to their employees. Even after the steps taken by the government several  private companies are beginning to implement cost cutting strategies to minimise their losses so as to survive in times of COVID-19. However they must remain aligned with the numerous labor laws and notifications issued by the various governments. Non-compliance of the same could eventually lead to litigation risks along with potential fines and/or imprisonment of the employers.[5]

Demands for suspension of labour laws

Employers’ associations called for the suspension of labour laws excluding some key primary provisions around the country for next 2-3 years to help the industry recover from the crisis caused by the COVID-19 pandemic lockdown. Labour Minister Shri Santosh Gangwar held a webinar with employers’ bodies such as CII, FICCI and ASSOCHAM to discuss issues such as re-starting economic activities, creating jobs and improving the situation of MSMEs to enable them to perform their obligations under labour laws.[6]

In the midst of the coronavirus-induced lockdown, a growing number of states including Uttar Pradesh, Madhya Pradesh, Rajasthan and Gujarat have pushed through modifications to their labour laws by way of amendments or ordinances or executive orders. They aim to grant the employers  some sort of blanket exemption from labour laws.[7]

The Uttar Pradesh government has brought an ordinance to exempt industries from several labour laws for 1,000 days and the Gujarat government has raised working hours from eight to 12 hours a day. Trade unions have strongly criticised these steps.[8]

Employment law issues while implementing work from home model

While the new reality of work from home is evolving, India’s labor laws have not yet matured into a stage where such a term is completely understood or provided for. Despite the advantages it brings, there is no specific regulation or statute governing the concept of work from home. While the recent changes to the Maternity Benefit Act, 1961 provides for working mothers to be able to work from home, for such a time as may be agreed between the employer and them depending on the nature of their employment, they do not go into providing more specifics. However, India’s labor laws and proposed labor codes remain silent on the issue. They do not recognize work from home as a job arrangement that is viable.

Therefore, in the absence of a special statute, it can only be assumed that the employment laws that would otherwise apply to employees when they are working from the employer’s establishment would be applicable. However, is it practical to place the physical work model arrangements and WFH model on the same footing?

The following factors should be considered when drafting any legislation around a ‘work from home’ alternative :

Tracking work schedules – Because the employees would be working from home, there is no instrument designed to ensure their work schedules and thus assess whether they eventually end up working overtime or working at all. In view of the fact that there are legal provisions that provide for specific working hours for most establishments and for overtime payments, it should be made possible for employees to claim overtime in WFH scenario as well by claiming that their work was carried out beyond the normal working schedules. Although employers may propose using software that monitors employees activity on their computers, this will need to be done in light of potential proposed changes to the data privacy regime in India that could restrict such tracking. Another factor to take into consideration is regulations applicable to establishments that choose to employ women in the night shift (usually between 8 pm and 6 am). Because a lot of these laws are meant to ensure the health of female workers, most of them will not apply in the event that female employees are expected to work from home during the night-shift.

Possession of intellectual property rights – Under the 1957 Indian Copyright Act, the copyright in any work done by the employee during the course of his employment lies with the employer, in the first place. Most employment agreements these days, however, create carve outs that allow employees to develop their own copyright in work that they do during ‘non-office hours’ or in their free time. The lines may get murky and vague when implementing a work from home policy without knowing when an employee was working and when the employee was taking a break, and it could lead to conflict as to who is the real owner of a specific product or development.

The Employee’s Compensation Act, 1923 aims to provide employee and/or their dependents certain relief in case of accidents arising out of and in the course of employment causing either death or disablement of the employee.  Therefore, an employer is obligated to pay an employee or his /her heirs if such employee experiences an accident and is injured during the ‘course of employment.’ Given the difficulty in determining when the employee may be ‘in the course of employment’, it could lead to a sticky scenario where an employee is claiming compensation from his/her employer for any injury that the employee suffered at home.

Foreign Developments in the WFM model:

After the pandemic descends, a paradigm change in working from home as a norm is anticipated and many employees will want to do that, at least for part of the week. But where do they legally stand? Some countries have specific laws supporting WFH, but India is presently far away from endorsing this ‘New Normal’ and recognizing it legally atleast qua the labour laws.

In Philippines, for example, employers are needed to develop a telecommuting system that accommodates working hours, substitute workplaces, equipment costs, occupational health and safety, applicable incentives and data privacy compliances. The employer is also supposed to ensure that the very same treatment is given to telecommuting employees as their peers working at the premises of the employer. Different countries approach WFH differently. In some cases the right to work from home is provided by a statute; in others it is entirely a contract between employer and employee.

German employment laws are one of the most developed and strongly pro-employee legislations in the world. The German Ministry of Labor and Social Affairs (BMAS) recently suggested that, even after the restrictions have been abolished, workers would be able to function from home where possible. The proposal follows a BMAS study, which shows that at least occasionally 40 per cent of Germans would like to continue working from home.

For decades, flexible work has been integrated into Finland’s working culture, originating from a deep-rooted culture of trust, equality and pragmatism. In 1996 Finland adopted flexible labor laws by means of its Working Hours Act. Although the rest of the world is catching on, Finland is taking further steps to keep ahead of the curve. Recently it amended its legislation in order to allow even more flexibility. In effect from January of this year, the Working Hours Act, 2020 allows employees to decide not only their working hours but also their place of work. The amended Act also allows employees to decide how to apportion at least 50 percent of their worktime and establishes a bank for statutory working hours. This allows an employee to save extra and overtime hours, flexible hours, time off accrued, vacation perks and additional benefits and later withdraw free time from such accrual.

Work from Home: Is it causing breach of security?

As work from home (WFH) becomes the new standard  at least for another few weeks businesses are scrambling to put in place more structured and formal WFH policies, say employment law experts. “Companies need to soon learn and understand that they are intermediaries under the Information Technology Act 2000 when they allow work from home, including mission-critical work. Hence, they are also required to comply with due diligence requirements and other compliances under the Indian cyber law, rules and regulations,” says cyber law specialist Pavan Duggal.[9]

To protect work laptops and devices from misuse, organisations may be lured to incorporate software to monitor how employees (or criminals) use the device. There are plenty of softwares that can record keystrokes or monitor mouse movements, but this raises GDPR compliance issues. Remote employees may well keep unusual hours and use their systems for both personal and work related reasons, so it is difficult to distinguish between monitoring the work and private life of an employee. Therefore, there is no way to track devices without violating the right to privacy of the employees. Seeking legal basis for storing and processing the data would also be challenging.[10]

Data protection compliance for organisations has been tested over the past few weeks as many employees settle into work from home routine. As if many were not already struggling to maintain compliance before COVID-19, it is all the more important now that they are aware of the potential risks. Coronavirus does not change the fact that employers also have to ensure the security of personal data and human rights.[11]

The risks associated with data security have significantly increased with the increase in employees working from home. Not only is this down to human error (although that is the most usual form of data infringement), but also includes fraudsters seeking to exploit the vulnerability of businesses. Zoom is among popular online conference tools that employees are using to remain connected. But all screen sharing apps have vulnerabilities if not used properly and the right security protocols are not conformed to. Hackers can easily target meeting calls that are not protected by passwords. Businesses must ensure their teams only submit meeting invitations with an appropriate password – particularly if it contains confidential information. This includes financial spreadsheets, HR files and CRM databases. It also helps reduce the possibility of a data breach. Using a strong password created by a random generator of passwords will help provide a link that cannot easily be hacked.

Most employees will have been loaned computers and other devices to use while working remotely. Companies need to closely examine the  possible threats and consider how they can be minimized. If employees do not use a virtual private network (VPN) to view shared company assets, then perhaps now would be the time to do so. Wi-Fi networks at home are unlikely to be as safe as a work network. Using a VPN will help secure the link, otherwise this could lead to easy hacking and allow unauthorised data access. Another common threat is the PC safety software standard. Employees may find their home computer is better than the work laptop given to use. Perhaps they have used a USB stick to transfer large files back and forth between the PCs to accelerate the process. There needs to be a proper guidelines in order to minimize such practices. Whether it is the web security gateways, cloud security defences, encryption, or anti-malware applications, the truth is that significantly fewer of these are available at home or, could be inadequately configured if they are present. Using one-time codes sent to recognised phones, or using an app to generate one-time PIN can help.[12]

Is Work from Home causing breach of Privacy?

Personal data may only be collected if necessary to achieve a specific purpose. In the existing Covid-19 crisis, the underlying principle of proportionality is essential. For example, is it crucial to document videoconference meetings regularly or to acquire the chats posted by employees to arrange virtual events? Similarly, is collecting information about the duration and frequency of employee break times proportionate to monitoring their working hours? Furthermore, what data is required to guarantee the security of the company’s information systems (e.g. webcam activation, tracking of mouse movements, screenshots)? Companies would need to determine whether the data security  by design and by default will be built into such tools to adhere to the data minimization concept.

In addition, employees have a part to play in restricting the amount of personal information that their employers obtain. For example, they should abstain from using work-related videoconferencing software during their free time for personal conversations or surfing on their professional laptop; they should remember to log out from videoconference sessions and turn off their webcams if they are not in use; and they should only provide information required to register on a work-related tool.[13]

What changes can be expected in the Indian Legislation?

India’s IT sector is trying to seek amendments in the tax and labor laws of the country as more than half of the workforce in the $191 billion industry could start delivering services remotely as part of the overall pandemic changes. During a meeting with government officials, IT business representatives, who predicted that approximately 50% of the 4.3 million IT employees in the country would soon be working from home, were asked to explain the policy reforms needed to promote this major transformation. Industry body Nasscom has already been tasked with preparing a comprehensive report after which it will be sent for further action to government bodies such as the telecommunications department and the labor ministry. “Some of the labour laws may not cater to a work-from-home environment, so (we) need to start looking through a fresh lens, said Rao, who is also the chairman of Nasscom.[14]”

Officials are of the opinion that labor laws should be amended in such a way as to protect employees while also offering employers flexibility. “As working from home catches up, people could work for multiple companies at the same time. So, the government will need to let employers and workers choose NPS (National Pension Scheme) instead of EPFO as a social security scheme, as in NPS a worker can be an employee today and a gig worker tomorrow, said Ashish Aggarwal, senior director and head of public policy at Nasscom.[15]”

Current labor laws would need to be changed to offer flexibility to the industry to allow working hours and timing shifts. In addition, employer ‘s role in workplace safety and health factors will require a reconsideration as the home is becoming the new place of work. Income tax laws shall also be checked as costs incurred by employers to allow work from home shall be considered as business costs and not as benefits in the worker’s pockets, including broadband or office furniture costs.

Work from Home

Pros	Cons
More independence	Risk of overworking
Less expenses	Disproportionate work-life balance
Improved technical skills	Risk in innovation
Improved communication skills	Risk to productivity
More work flexibility	Home office costs
No office distractions	Distractions at home
Collaborate across locations	Chances of breach of security
Reduction in work absences	Increased isolation
Provides more job opportunities	Less face time
Build professional networks	Technical problems
Lower Attrition	No human interaction
More productivity	Misunderstandings & Mistakes
Savings to National Electricity Grid	Difficulty in mentoring
Lower Traffic Jams	Slow progress
High levels of motivation	Threat of Impersonation

[1] https://hbswk.hbs.edu/item/how-companies-benefit-when-employees-work-remotely
[2] https://www.investopedia.com/personal-finance/work-from-home-guide/#citation-2
[3] https://economictimes.indiatimes.com/tech/ites/99-8pc-workforce-in-it-sector-incapable-of-remote-working-study/articleshow/75080948.cms?from=mdr
[4] https://economictimes.indiatimes.com/news/company/corporate-trends/covid-19-impact-for-manufacturers-work-from-home-doesnt-work/articleshow/74569188.cms?from=mdr
[5] https://www.legaleraonline.com/articles/lay-off-and-retrenchment-in-the-time-of-covid-19
[6] https://economictimes.indiatimes.com/news/economy/policy/lockdown-hit-industry-demands-suspension-of-labour-laws-for-2-3-yrs/articleshow/75633578.cms?from=mdr
[7] https://www.civilsdaily.com/news/relaxation-in-labour-laws-due-to-covid-19-outbreak-and-their-impacts/
[8] https://www.thehindu.com/news/national/coronavirus-lockdown-suspend-labour-laws-for-2-3-years-employers-associations-urge-government/article31537997.ece
[9] https://www.business-standard.com/article/companies/work-from-home-ensuring-data-security-a-challenging-task-for-businesses-120032900972_1.html
[10] https://www.itgovernance.eu/blog/en/gdpr-the-implications-of-working-from-home-or-on-the-road
[11] https://digit.fyi/working-from-home-and-the-impact-on-data-protection/
[12] Ibid
[13] https://www.fieldfisher.com/en/services/privacy-security-and-information/privacy-security-and-information-law-blog/the-risks-of-online-employee-monitoring-during-the
[14] https://economictimes.indiatimes.com/tech/ites/it-seeks-changes-in-laws-as-work-from-home-set-to-become-norm/articleshow/75684748.cms?from=mdr
[15] https://economictimes.indiatimes.com/tech/ites/it-seeks-changes-in-laws-as-work-from-home-set-to-become-norm/articleshow/75684748.cms?from=mdr