Updated: Sep 21, 2022
California does, indeed, require employers to pay all business costs, but do they need to pay for your increased electricity use?
Like every other company, Amazon sent all employees who could work from home to work from home in 2020. But what they didn't do was start paying for internet and electricity costs for their employees, according to a lawsuit filed by an Amazon engineer in California.
On the surface, it makes perfect sense. California law requires companies to pay all business expenses. Employees who work at home use more electricity and internet than they would if they came into the office. Therefore, the engineer has a case. At least, that's why the judge didn't throw it out.
Amazon argues that these expenses aren't the company's obligation since it wasn't its choice to send people home; it was following the state orders to send everyone home. The law doesn't seem to have an exception for emergencies.
My best bet? The Amazon engineer will win.
And then he and every other California employee will lose. Here's why.
Companies want employees in the office.
There has been an ongoing battle between bosses who want people in the office and employees who want to be home. Hybrid work seems the best solution to that problem--as it gives everyone a little of what they want. Ninety percent of companies offer hybrid work and only 4 percent demand full-time in-office work for jobs that employees can do remotely.
But hybrid work requires the company to maintain office space and all the costs that go with that. If they have to pay people extra to work at home while still paying for office space, the work-from-home perk will likely be the thing that goes away.
Employees are currently coming out ahead.
While I believe that the engineer will win--California law is pretty straightforward--he's not considering how much money he's saved by not going to work. Pre-corona Californians spent an average of almost 30 minutes commuting one way.
Even before gas prices began to skyrocket, people probably spent far more on gas than on they were spending on increased electricity and internet costs. As of June 9, 2022, Californians are paying an average of $6.403 per gallon of gas. The plaintiff argues that he's owed expenses between $50 and $100 per month. In pre-pandemic 2019, the average American used 34.5 gallons of gas per month. If working from home cuts gas usage in half, the engineer still comes out ahead. Not to mention wear and tear on the car and the cost of pants suitable for the office.
How do you figure out the costs?
The cost is evident if an employee has no home internet and needs home internet for work. However, I doubt that an Amazon engineer lived in an internet-free home prior to 2020.
If he is single and lives alone, and his electricity costs go up when he comes home, that's also easy enough to show. But, when things shut down in California (as they did in most of the world), everyone came home. Kids did online school and were home all day. Spouses and roommates came home. How do you divide the percentage of increase that varies from what person did to the others?
I realize this is nit-picky, but it's not actually going to be that easy to tell. Companies will have to estimate or give everyone the same stipend based on a figure they hope will pass muster with the courts.
This is just California, right?
Yes, this is a California case based on California law, but what happens in California tends to spread across the nation. If the engineer wins, you may see this concept spreading across states.
Of course, it makes sense for your company to pay for work from home costs when you don't have office expenses to pay for. Share the wealth. But because most companies are, at most, hybrid, office space expenses remain. (Though they should be less than when everyone is there every day.) Be careful about how you treat your employees and how you approach work from home. Even if Amazon wins here, the court expenses are tremendous. Amazon has the cash to fight it; smaller businesses won't.