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Expense reimbursement for office chair at home office

This is a new one for me. We had an employee, who works out of his home and travels, request reimbursement for a new office chair for his home office. Is this standard practice to allow the expense? Thanks

Answers

Len Green
Title: Performance Improvement Consultant and E..
Company: Haygarth Consulting LLC
LinkedIn Profile
(Performance Improvement Consultant and ERP Strategist, Haygarth Consulting LLC) |

In the world of telecommuting, remote workers, expectations that staff are available via a device 24x7 (almost), the definition of standard practice changes I think.

Why does he need/want a new chair?
Do you cover other costs such as cell phone and internet access?
What risk do you really face if you reimburse him for a reasonably priced chair?

I'd work on defining if this is a whale v a minnow first of all.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

Pay for a reasonable chair, but tell him that it would be a taxable event (to him).

Edward Thill
Title: VP - Finance & Operations
Company: Performance Trust
(VP - Finance & Operations, Performance Trust) |

If his home is his primary work environment and you want to throw a good employee a perq, it's certainly justifiable. The risk of course is how many others are in similar circumstances and will want the same treatment? What about a new desk to go with that chair? I think it could be a chip of goodwill if used with discretion but depending on the size and structure of your organization, it could also open Pandora's box. Think broadly before ruling.

James Scott
Title: Consulting CFO
Company: Early Growth Financial Services
LinkedIn Profile
(Consulting CFO, Early Growth Financial Services) |

Up to $100 and treat it as a disposable office supply. But no other furniture, no desk, no lamp, no waste paper basket...long list of no's or some folks will abuse this. Yes to pay for cell phone and internet connection. Maybe an extra monitor, depending on the job. But not the rest of cable tv cost. Some folks think the company should furnish their entire home office, which is ridiculous.

John Cook
Title: Independent Consultant
Company: Consultant
(Independent Consultant, Consultant) |

My recommendation would be to have a written policy. Whether it is standard practice I think depends - many, if not most really large corporations (read $5B+ revenue and 10,000+ employees) I have worked at have a published policy on this topic. The reason is that many companies actually encourage or even require that certain workers don't have a permanent cube or office at the main office (they have "hotels" or "drop ins" locations for when people have to come into the office, but basically require that they work from home most of the time). The reason these companies do this is it saves money.

The last really large company I consulted at had 33% of its workforce as "remote" workers (mostly "knowledge" workers like code writers who could attend meetings via Webex etc as needed, and who could be given manageable quantitative goals - like write x lines of code per day or finish certain milestones on time - I don't want to start a debate as to the relative merits of whether this model works for all types of folks as I actually think it works in some instances and doesn't in others - but the reality is that many companies utilize this model).

In those cases, the goal of the company is to make sure that they are treating all workers fairly and so the company would actually provide the desk, chair, keyboard, monitor, etc and send an ergonomic consultant out to the employees home to ensure a proper work environment (just like is done for people who drive to the office each day). Ultimately, the company believes that it saves them money in the long run due to reduced workers comp claims and it allows them to have fewer office buildings (either owned or leased). The company I consulted with was able to reduce its office footprint by 5 buildings and 300,000 sq feet. Not an insignificant chunk of change.

Just giving you the large corporate view. Understand that this may not be your fact-pattern, but believe that either way it would be good to have a policy on it for your company. Depending upon the employee, you might find that if he develops carpal tunnel at home, he would have a claim - as basically it would be hard for you to claim that you didn't know he was performing the majority of his work from home. Even if you avoid legal issues, it's still best to just treat your employees fairly if you know that they are working from home. Pay for a reasonably priced chair and expense it as it's your business expense and not compensation to him - in the companies that I described above, the typical cost to set up a remote worker at home was $2K (all non-taxable to the employee) - but the fully burdened cost to keep them in an cube in Santa Clara for a year was $5K per year. The employees signed an agreement stating that upon termination of their participation in the remote workforce program, the company would take the equipment back.

Having a policy just ensures consistency and allows for communication to your workforce. I've found that when employees feel they are looked after and treated fairly, they are far more productive (read profitable) for the company. Make sure you don't see employees as the problem. They are the solution. I think many people often forget this when "dealing" with employee issues - look at it as an opportunity to make your employee happier - not just another reason to say no to them (penny wise - pound foolish). If it wasn't a smart thing to do, the top companies wouldn't be doing it (google, apple, etc).

Anonymous User
Title: CFO
Company: Local Government Agency
(CFO, Local Government Agency) |

Again. Who owns the chair, etc.?

CFOs are conscientious of such things.

Anonymous User
Title: CFO
Company: Local Government Agency
(CFO, Local Government Agency) |

I would ask him or her to sign a document that says the corp owns the chair and he is to return it should he leave.

His/her reaction will speak volumes about the employment relationship.

Michael C
Title: Tax/Business Consultant
Company: Self
(Tax/Business Consultant, Self) |

The company should have a written policy for its telecommuting employees.

I've consulting with some companies and many telecommuters over the years and, in many instances, regardless of the company's size, the telecommuter is responsible is responsible for all of his/her furnishings for their office in home.
There are exceptions in which the company will pay for certain expenses like a cable/telephone line as it's needed for work.

Basically, it really depends on the company and the type of policy is should have or already have regarding the telecommuting issues with its telecommuting employees.

The other issue is having the telecommuter get a written/signed letter from the company stating that it's the company that necessitates the employee from working from home instead of at the company's location, IF it had a local, physical location, as some companies do not.

The company's policy should dictate, amongst other things, on what reimbursements are allowed and who has ownership on those items that are reimbursed. Those reimbursed items could be considered "taxable income" to the employee.

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