Survey: Companies should pay cell phone bills

Not paying for personal calls ends up costing a company in time and paperwork, analyst says

So, your company won't pay for personal calls on your business cell phone?

Bad idea, according to one analyst firm that surveyed businesses on the topic.

Not paying for personal calls ends up costing a company in time and paperwork to recoup the costs, according to a survey of 1,023 business users in the U.S., said Bill Hughes, an analyst at U.S.-based In-Stat, in an interview Tuesday.

Hughes said the survey shows that 44 percent of employers take the right approach with business cell phones. The right way, he said, is for a business to set up centralized billing with a carrier or carriers that covers the calls or data use of its workers, without regard to whether the minutes are for personal or business use.

In-Stat's findings mean that more than half of employers, 56 percent, are "trying to save money no matter how much it costs," Hughes said. "If a company is trying to save a few bucks by getting employees to avoid personal calls on cell phones, there's no way it can be done."

The survey, conducted in December, included large and small business users in the U.S. "Some small companies are doing cellular billing right and some of the biggest companies in the U.S. are doing it wrong," Hughes added.

Hughes said the cell phone should be treated the same way a company treats a photocopier or a desk phone, paying for all of it and trusting employees to regulate themselves.

In fact, Hughes said the survey findings show that the time an employee spends on paperwork and related tasks to reimburse a company for personal calls made on a company cell phone often exceeds the value of the personal calls. This is true 25 percent of the time, while for all the rest, the savings is only a "few bucks" per month.

In-Stat also found that asking employees to pay for their own cell phone minutes doesn't result in that many more minutes of personal use, compared to the group that reimburses such calls. But having employees pay the bills for business calls can lower overall business calls considerably, resulting in lower business productivity, the survey found.

Hughes explained this phenomenon, noting that those users who carry a "corporate liable phone" with all calls paid by the company, made 216 minutes of business calls per month and 54 minutes personal calls per month, on average. By comparison, those users with an "individual liable phone" with all calls paid by the worker, spent 58 minutes per month on personal calls and 77 minutes on business calls, on average.

So, the difference in personal calls per months averaged only four minutes, compared with business calls going way up when they are paid for by the company. "So comparing 77 minutes versus 216 minutes, congratulations Mr. Manager, you saved your company maybe US$30 a month [avoiding personal call costs] and have reduced the productive time of the employee by 2.5 hours of business calls," Hughes said.

Hughes said about 7 percent of the companies in the survey will pay for business calls and issue their employees an itemized listing of the calls, and then ask the employees to reimburse the company for the personal calls.

Hughes said he was somewhat surprised by the findings, and noted that the survey was not sponsored by any carrier. The findings could be used to encourage carriers to educate their customers to impose corporate billing, which is the best option for a customer, but will also lead to increased revenues for both voice and data services for carriers, he said.

"The takeaway is that a lot of companies want to save money by pushing cell phone costs onto employees, but it's a bad idea," Hughes said. "If the chief financial officer in a company has the opinion that his employees aren't honest and will eat and eat minutes until they throw up, I would hope this would give the CFO's pause."

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