Some employers permit telecommuting where employees work from home and contact the office through electronic methods. Which of the following identifies a problem that the employer may face?
A) Telecommuting could lead to the problem of self-selection.
B) The employer encounters new problems posed by moral hazard.
C) Telecommuting could contribute to an informal organizational structure.
D) The cost of hiring and retaining employees will increase.
E) Telecommuting can blur the boundaries of the firm.

Question

Quizplus · Accepted Answer

The employer may face new problems posed by moral hazard when employees work from home, as it may be difficult to monitor their productivity and ensure they are working as effectively as they would in the office. This can lead to concerns about shirking and reduced effort, which could impact the employer's ability to achieve its strategic goals. Self-selection (A), an informal organizational structure (C), increased hiring and retention costs (D), and blurred boundaries (E) are all potential concerns associated with telecommuting, but they are not directly related to moral hazard.

Some Employers Permit Telecommuting Where Employees Work from Home and Contact