I've argued both sides of this issue (both for and against) and generally they come down to situational communication.

Before jumping in though I'd like to create some definitions that I use in my mind to keep things differentiated. There are three configurations of remote work that have been called at one time or another, telecommuting.

1) Working from home. This is perhaps the most interesting one and it is specifically an employee in their own home using their own or company equipment to connect back to "the office". They participate in teleconference calls when invited and generally have a VPN type connection to the company network.

2) Working at a 'commuter' desk. These are people who are working away from where they normally would and sitting at a desk in a company owned facility that is not specifically assigned to them but hosted in a company facility.

3) Working at a 'remote site'. These are members of the group who are working at a company facility that is distant from the primary facility that is hosting the group they are associated with. It may or may not include other "remote" members of the group but it is a permanent arrangement unlike #2 above.

I don't think there is a lot of controversy or question around #2. People are traveling, they can stop in a local office and get some work done and have access to things like printers and conference rooms. So for those workers it is a way to work effectively while travelling.

Option 3 (a "local" office for a member of a "remote" group) is generally well supported by most organizations, especially ones with extended sales presence in multiple markets. This arrangement benefits the company by allowing them to hire in places where people don't want to move away, and in my experience, it makes the sales team (if there is one) at that facility more effective as it can cut down on communication time between corporate and sales.

So lets agree when we're talking about "telecommuting" as something which can be argued for or against, we're talking about allowing full time staff to work out of their homes.

There is lots of material on this with many different angles from team building to team communication to legal liability.

Most people don't think about the legal question, just like they don't think about collecting sales tax from people at their garage or yard sale. However, in some jurisdictions it is illegal to work full time out of your home without a business license, fire department inspection, and ADA compliant facilities (for example). In some places you need a zoning allowance. There is a question about injuries you sustain while at home but "working", is that covered by workman's compensation? homeowners insurance? (likely both will refuse to cover it). To the extent that working at home becomes more popular, you will see municipalities crack down on this just like they do on lemonade stands[1] from time to time.

Then there are the team dynamics. If you have an office which some people hate (say a noisy open office plan) but they can't work from home (maybe they are renting one room out of a 3 bedroom apartment which has two families living in the other two rooms). They will have negative feelings about the company and their fellow employees who have the luxury of working from home. If you have a lot of spontaneous brainstorming sessions, few will remember to "dial in" someone who is not in the office. This will make the person off site feel "out of touch" (which can lead to them feeling anger and distrust for the rest of the team).

But lets answer the 'hiring side' questions, that is easy.

-- They have to be on site to avoid negative team dynamics and legal liability.

-- Yes, and I told the employee they had to work on site at least 4 days a week.

-- No.

-- I've seen that happen (I wasn't personally involved in the decision). The change was okay because the person's job was essentially a group of 1 (they had few external dependencies) and they were reliable at meeting the schedule. They essentially became a "remote office with 1 employee" in it.

-- I have been in companies where it was pretty absolute (everyone comes into the office) and companies where it was more flexible. In my experience, groups within the company without work-at-home people had better group dynamics and higher productivity. But to really understand why that was you needed to understand how the company got things done and how groups negotiated deliverables.

[1] From 2011 -- http://www.forbes.com/sites/erikkain/2011/08/03/the-inexplic...