Businesses must change their attitudes about people working from home and use the internet to connect employees through "telework", the Minister for Broadband and Communications Stephen Conroy has announced.

The federal minister said Australia is lagging behind other developed countries in harnessing the internet for business and needs to catch up.

"In Australia the number of people with an arrangement with their employer to work from home has been low by international standards," Senator Conroy said at a Telework Forum in Sydney yesterday.

Australian statistics are indeed at odds compared to other nations, with the ABS recording that 6% of employees from Australia have a degree of telework arrangements with their employer.

"In the US, 10% of employees telework at least one day a month and eight European Union countries reported that more than 10% of workers [were] involved in telework a quarter of the time or more, and that was in 2005," Conroy said.

With the roll out of the National Broadband Network (NBN) approaching,Senator Conroy promised that high speed connections would "potentially revolutionise" business.

By connecting workers from home, employers could tap into the skills of workers from across the country, improve work-life balance and potentially reduce absenteeism, he said.

But industry experts warn about the many challenges associated with working from home.

According to Business Wealth online, working from home can pose many new challenges - namely the problem of setting boundaries, having self-discipline, and working in isolation.

The industry website said being able to work from home offers many benefits, however the most challenging task of working from home comes from setting clear boundaries between work and family obligations. "It is not uncommon to work a 12-15 hour day, [and employees] can face difficulty separating work from the rest of [their] life."

Business Wealth online said having employees working from home may cut time otherwise wasted on office politics, but "no more Friday night drinks, no more pats on the back, less time just being with your co-workers"could also lead to a lack of engagement.