Phone Stipends vs. Company-Issued Phones: Pros and Cons

When employees are required to use a phone for work, most employers opt for one of two options: phone stipends or company-issued phones. Each option can have its benefits and drawbacks, but the right choice will depend on what type of industry you work in, your budget for managing employee phone use, and other extenuating circumstances.

Learn more about these employee phone options to help determine which one is right for your workplace.

Businessman using ompany phone

How Each Option Works

With a phone stipend, employees use their own phone but get a reimbursement to help cover their bill at the end of each month. In most cases, employees are responsible for choosing and purchasing their actual phone and data plan. They continue to use their personal number for work purposes, and the employer simply pays for all or part of the phone bill to compensate for this work use.

With company-issued phones, employers have more control. They choose which phone and data plan the employee will have. The phone is generally used only for work, so the employee has a unique work number that isn’t shared with personal contacts. In addition, some employers use call tracking features that allow them to monitor track call analytics and listen in on and record employees’ conversations.

Security Concerns

Security should be one of the biggest factors in deciding whether to give an employee a phone stipend or a company-issued phone. If your company is not dealing with sensitive materials or client information, this likely won’t be an issue. But for many businesses, allowing business materials onto personal devices like smartphones puts the company at risk.

When personal and work phones are not kept separate, work material is more likely to be compromised. Someone other than the employee may have access to the phone outside of work hours or the phone could be hacked. This is also a risk with company-issued phones but, since the company will have more control over phones they give to employees, it’s easier to maintain the security features necessary for protecting work materials stored on these devices.

Company Phone Plan Affordability

While security is certainly a concern, most companies are just as concerned about the bottom line when it comes to managing employee cell phone use. If you’re looking to make the smart choice for your business budget, you’ll likely find that cell phone plans from a carrier like T-Mobile can easily accommodate company-issued phones at an affordable price.

For example, T-Mobile offers budget-friendly monthly rates for plans that include unlimited talk, text, and data. Other perks, like international texting and data, in-flight texting, and free mobile hotspot data make these plans especially convenient for employees who travel or work outside the office. While there is also the upfront cost of purchasing employee phones to consider, many employers end up saving money in the long run thanks to lower monthly bills across the board.

Businesswoman on the phone

Tips for Successful Implementation

If you choose to use phone stipends for your employees, be sure to set parameters from the start. Clarify that even though you are helping to cover the costs, employees are responsible for their phones should any damage occur. You’ll also want to detail professional standards you expect your employees to use on their phones, such as professional voicemail greetings.

Due to the complications that come with phone stipends, more and more companies are choosing to utilize company-issued phones in their workplace. To make sure this effort is successful, however, come up with a clear process for monitoring phone use and keeping hardware up to date. Explain whether employees are permitted to use their company-issued phones for personal calls, and detail expectations for the hours during which employees are expected to be available to respond to work calls, texts, and emails.


Finding the right fit for your company will require some research, but the results can include improved productivity, client satisfaction, and savings for your bottom line. Use this information to decide whether your employees should receive a company-issued phone or a monthly phone stipend.