More companies are enacting and enforcing return to office (RTO) policies, if not on a full-time basis, then at least for two or three days a week. In doing so, they are hoping to enhance corporate culture, increase creativity through interaction, and ultimately boost productivity. But at the same time, employers must meet workers' needs, ensuring that in attempting to boost morale and the bottom line, they don't end up chasing their best workers away.
A survey of 1,000 corporate decision-makers by ResumeBuilder.com found that 90% of companies with office space will have an RTO policy in place this year. While many businesses gave up their physical office spaces during the pandemic, the survey found that 64% of respondents said their company currently has a physical workspace, 20% plan to by the end of 2024, 11% plan to in 2025 or later, and just 4% never plan to have a physical workspace. To encourage employees to return to the office, 72% of business leaders said their company will offer commuter benefits, 64% will provide catered meals, and 57% will offer childcare benefits. Twenty-eight percent said their company will threaten to fire employees who don't comply with its RTO policy.
RTO Trends in APAC and LATAM
Asia Pacific (APAC) countries lead the world when it comes to time spent in the office, according to a November 2023 report from Jones Lang LaSalle. In the first half of 2023, the global average for time spent in the office was just over three days per week. Meanwhile, in China, it was 4.7 days, 4.4 days in India, and 4.2 days in South Korea. In Japan, workers were in the office for 3.8 days per week. Findings from Coldwell Banker Richard Ellis 2023 Asia Pacific Office Occupier Sentiment Survey revealed that the office utilization rate in APAC was about 65% by the end of the first quarter of 2023.
KPMGs CEO Outlook 2022 South America found that 64% of company leaders believe that work will return to being fully in-office by 2025. A study from Quiddity found that three years after the pandemic, on-site is the predominant work modality in Argentina, Brazil, Colombia, and Mexico. Seventy-five percent of workers surveyed are already in this modality in those countries, while 14% are in hybrid work arrangements. WERC and Global Lines 2023 survey on mobility in Brazil found that three-quarters of the 130 multinational businesses surveyed reported that they are using a hybrid schedule, while 20% of companies report exclusively being on-site.
The Companies Pushing for Full-Time RTO, and the Workers Pushing Back
United Parcel Service (UPS) and Boeing are among the major corporations requiring at least some of their employees to come into the office full-time, as more employers seek a return to pre-pandemic ways of working.
During labor negotiations at UPS last year, union officials said drivers and warehouse staffers resented working in person while office employees could stay at home. I'm a big believer in the power of one, UPS CEO Carol Tom said on a recent call with investors, explaining the move to require everyone back in offices. In terms of our culture, we are a network company, not just of logistics capabilities, but of personal relationships, too.
Analyses show that these companies, however, remain in the minority. About 80% of Fortune 500 companies offer at least some remote work opportunities, according to data from software firm Scoop Technologies. The number of companies requiring full-time attendance dropped to 38% at the end of 2023, from 49% at the start of the same year.
A large reason for that is employee pushback. Last fall, Boeing told workers in its commercial division they need to be in the office five days a week. Boeing noted that manufacturing employees have been working in person since factories reopened, following a brief pandemic closure.
Employees soon took to social media to remonstrate, and the union representing Boeing engineers said some of its members planned to quit if they were forced back full time. If Boeing can outsource engineering work to Poland or India"effectively letting those workers telecommute from other continents" it can and should also allow its aerospace professionals living in Stanwood or Sumner to work remotely too, the Society of Professional Engineering Employees in Aerospace union said.
Will the Stick Approach Work?
For years, employers felt they didn't have enough leverage to compel employees back to the office. Now, in the face of a softening job market and white-collar layoffs, some workers say they feel more compelled to show up. Office occupancy across the biggest U.S. business centers has stayed around 50% of pre-pandemic levels for the past year but hit a post-pandemic high of 51.8% in late January, according to data from Kastle Systems.
But getting workers back to the office has not been easy, and some companies are making it even harder. AT&T, for example, ordered more than 60,000 managers to return to the office on a hybrid basis starting in July. At the same time, the company reduced the number of offices for managers, making it harder (if not impossible) for some to commute, employees said.
Resistance to RTO has been formidable and vociferous, and not just in the United States. An internal letter criticizing German software company SAP SE's back-to-office policy included more than 5,000 signatures in less than two weeks after its announcement in January. We feel betrayed by a company that until recently encouraged us to work from home, only to ask for a radical change in direction, stated the letter.
Even pre-pandemic, SAP allowed many of its workers to work remotely. As recently as 2021, SAP CEO Christian Klein described the company as a 100% flexible and trust-based workplace. But after the company reported strong earnings in January, Klein expressed frustration with the effects of remote work on SAP's culture. I'm not a big believer that on a video conference platform, you can understand our culture, you can get educated, and you can get enabled to do your job best, Klein said.
Many companies, rather than offering the carrot of boosted benefits to draw employees back, are offering a stick. Some companies that had flexible policies during the pandemic have tried linking office attendance to performance reviews, while others have threatened to fire those who don't come in. Employees working remotely full time were 35% more likely to be laid off in 2023 compared to counterparts who worked in the office at least some of the time, according to an analysis of 2 million white-collar workers conducted by employment data provider Live Data Technologies.
The Carrots Used to Lure Workers Back
Other companies are taking a more pragmatic approach, focusing on corporate culture to draw workers back. When bringing workers back into the office, some employers offer commute-worthy experiences that create excitement and compelling reasons for employees to get on board and participate. Free lunch, game nights, and live concerts are among the other perks a growing number of employers are using to entice workers back. Companies are also relaxing their dress codes, adding commuter benefits, and even raising salaries. Some companies are turning to the Envy Office to attract workers.
Whether carrot or stick, companies are walking the line between increasing productivity and employee discontent. Businesses must recognize that top professionals now prioritize flexibility and work-life balance, a key finding of the 2023 KPMG Global Assignment Policies and Practices Survey states. To remain competitive, organizations will need to blend the advantages of in-person collaboration with a continued commitment to accommodating the diverse needs and preferences of their workforce, all while striving to attract and retain the best talent in this ever-evolving employment environment.
RTO's Impact on Talent Mobility
When it comes to RTO and mobility, there are two points to consider. The first is the impact of company policies on the work of mobility itself. As RTO becomes more mainstream, it's likely we'll see the amount of global and intracountry assignments, and therefore mobility work, ramp up. As companies settle on RTO structures, their need to move employees to support those structures" and overall business and talent strategies" will become clearer. With greater clarity comes the need to implement mobility programs to facilitate relocations.
Clear and consistent RTO policies also play a key role in employee morale and retention, which ultimately impacts mobility as well. Top companies recognize that prioritizing the employee experience yields numerous benefits for their business, including enhanced productivity. Neglecting the employee experience can have negative consequences for a company's future growth and profitability. With RTO mandates continuing to pick up steam, employers should focus on workers' wellness to maintain their support, while at the same time not sacrificing work culture and productivity.