The Problem with BYOD Stipends and What's Next for BYOD Costs

Companies have plenty of reasons to make bring your own device (BYOD) policies a part of their businesses. One of the main attractions, and a primary reason for adopting BYOD in the first place, is how using a personal device makes employees more productive both in the workplace and at home. Another consequence of using BYOD is that employees are more likely to be satisfied with their jobs. But with these benefits also comes the concern over BYOD cost. BYOD’s most vocal proponents say the policy ends up saving businesses money in the long run, but its critics maintain that bring your own device is ultimately costly. One of the main points of contention is companies’ use of stipends as a way to offset the costs of a BYOD program for employees. While BYOD is likely here to stay, it’s very possible stipends on the way out.

Finding the cost of a BYOD program can be somewhat tricky. Some policies place all the expenses on the employees themselves, which can cause more than a fair share of conflicts. To avoid these troubles, many companies have turned to paycheck stipends to try to offset these costs, but the amount the stipend covers depends largely on the company. According to one recent survey, the average stipend was $85 per month for each employee. With costs adding up to more than $1,000 each year for every employee, it’s easy to see how BYOD can quickly turn into a major expense for companies.

In many ways, stipends were introduced as a response to other measures taken to help employees deal with the added costs of using their devices for work. One of the most common ways early on was with reimbursements filed through expense reports. Employees would tally up their own expenses accrued through their mobile device and submit a report to the company. But this method presented plenty of challenges for the company as reimbursements became more complicated and costly. For example, a research group found that processing an expense report ended up costing the company $18 for each report, adding to the price of the reimbursement. Employees would also find ways to game the system, charging for expensive plan costs even if only a fraction of the data on the plan was used for work purposes. All of this added to a more complicated and costly strategy that companies felt they needed to change. As a result, the monthly stipend was developed.

At first, stipends looked like a fair way to measure out how much each employee should get for the work use of their individual devices, but like reimbursements, they may actually end up costing employers more than the actual usage should dictate. For one thing, each employee can end up having vastly different needs and duties. An in-office job would likely have much less mobile expenses than a job that takes an employee around the world, racking up international roaming charges in the process. There’s also the added complication of adding multiple devices for each employee. These days, workers tend to have more than one devices--usually a smartphone and a tablet--and the number of devices requiring internet connectivity is only likely to increase as the Internet of Things takes off. Employees may also take advantage of the system just like reimbursements by qualifying for large stipends, only to use a part of it for their phone bill.

So what do companies do about the costs of BYOD? There are a number of solutions being batted around. One looks at issuing wireless bill credits that go directly to a specified phone bill. The amount would be determined by splitting employees into separate tiers based on the work they do. This would require more management and oversight, however, and might result in some backlash by employees unhappy with what tier they’re placed in. Another solution focuses on specific data usage, centering on using data from phone companies to determine exactly how the phone is used and what percentage is used for work. Companies may also purposely pay only a part of mobile expenses, leaving the rest for the employee to pay for. There’s also the hands-off approach favored by many companies, where the organization leaves all expenses to the employee. The idea is that workers should simply get used to paying for their own usage if they want to use their own device.

Whatever a company chooses, it’s looking more and more like stipends may become a thing of the past. While solutions are out there for dealing with some of the problems with stipends, employees should start preparing now for handling BYOD costs without company assistance. With the economic situation still uncertain and businesses looking to cut costs wherever they can, it’s a likely possibility that BYOD expenses will come down to the employee’s responsibility.