Telecommuting in Trouble – Or Is It?

A recent column in the Wall Street Journal pulls together a series of reports on retrenchments in telecommuting policies: AT&T, Intel, HP, and the federal government have all pulled some employees back into the office from existing telework programs. Business consolidation, security worries, and a desire for more face-to-face interaction all played a part in these widely-publicized losses for telecommuting.

And yet, the telecommuting landscape is not entirely bleak. Last year, 135 employers in Georgia instituted new telework programs, helping to cut down on traffic and pollution and improve the quality of life for the affected employees.

The difference? Georgia has a cutting edge tax credit program[PDF] for employers who move employees to telecommuting. Employers can get a tax credit of up to $1200 per employee for expenses incurred in setting up equipment, including computer hardware and software, internet connectivity, installation and maintenance fees. There’s a further credit for the assessments needed to determine how telecommuting can fit into a company’s operations – an up-front cost that can be a stumbling block.

In the face of economic pressures, especially with the threat of a looming recession, businesses are naturally driven to evaluate their operations strictly in terms of their own bottom line. From that point of view, the savings to society generated by telework are easy to ignore. The Georgia program recognizes these savings (employers in heavily polluted areas can get larger credits) and shares them with the employer: a fairly typical use of tax policy to influence behavior. The success and spread of such policies could do a lot to ensure a bright future for telecommuting.