Preamble
This blog is about work. How and where we work, and why the discussion generated by these questions is relevant to the future of work. The world of work is evolving. This blog will provide some history and context, highlight the push and pull between employees and employers, and sample some Return To Office (RTO) policy considerations. It’s important enough to repeat: The world of work is evolving. Correspondingly, this blog will try to keep pace.
Why RTO
The COVID-19 pandemic has had an impact on how, and where, many people work. Prior to the pandemic, the vast majority of workers spent 5 days in the office every week. The shutdowns in response to the pandemic forced employees to work from home, or not at all, for an extended period of time. Many companies have instituted RTO policies to get their employees back into the office, but what are the motivations behind this decision?
In this article, we provide some motivations for why a company may institute a RTO policy. The justifications are split into three main categories. Most companies have multiple motivations for crafting their RTO policy in their specific way. We will use future posts to confirm or refute the logic of some of these motivations.
Irrefutable - mostly
The first group appears to be irrefutable on the surface. We will dive into these justifications in future posts.
Physical presence required
Some job roles within some companies require a physical presence. As covered in the July 2024 and the August 2024 blog posts, wait staff, teachers, and store employees need to be physically present in order to do their jobs.
Regulation
Regulations come in all shapes and sizes, and may force a company to call their employees to the office for work. Some regulations are generated by the company’s industry - e.g. financial advisors’ workspaces are subject to inspection by FINRA, the Financial Industry Regulatory Authority. The company may require its employees to work from the inspected workspace in the office, rather than get an employee's home workspace inspected. Others may be imposed by the company’s customers - e.g. federal contractors may be required to come into the office to prevent the possible leak of classified information.
Credible
The next group of justifications is typically based on logic. These justifications are typically shared by a company because of their logical appeal. Whether or not the logic is backed by research is something we will cover in future posts.
Collaboration
One argument made by many companies is that physical proximity leads to better communication. By being in the same office, teams are able to work through roadblocks more efficiently.
Innovation
Physical proximity can also lead to greater creativity. Innovative ideas percolate in the break room when employees from different teams engage in ad hoc conversation at the water cooler or the coffee machine.
Mentoring
Some jobs require an entry-level employee to shadow a more senior employee to learn the ropes. There is an argument to be made for the value of in-person mentoring.
Local economy
Some companies may require their employees back into the office in order to boost the small businesses in proximity to the company's office. The deli that's a favorite among the employees of the company. The dry cleaner that offers same-day service. The daycare that the company has an agreement with. The fitness center where the lunchtime Pilates class looks like an extended team meeting.
Hidden
Some motivations may be discussed internally within a company’s leadership, but not shared broadly. One of the most common reasons why these motivations may not be shared is the backlash they may cause among the employee population. Some may even stem from an unconscious bias.
Lack of trust
Some senior executives may believe that their employees are slacking off when remote. They may influence that company's RTO policy to require employees back into the office to have the peace of mind that everyone is working.
Return to normal
The pandemic forced a lot of change. Companies and executives may be feeling change fatigue and institute a “flight to normalcy” RTO policy to match what existed prior to the disruption. This can be an especially powerful motivator if the company is not doing as well as they were before the pandemic.
Follow the leader
When one company in an industry or geography institutes an RTO policy, it’s only natural for other companies to feel that they can do the same. This is especially true when the first company is considered the leader in the industry. Other companies almost feel that they have to follow suit, or risk falling further behind their main competitor.
Justify real estate investment
Empty offices may cause some heartburn in the financials of a company. If the company is in a long-term agreement for their real estate, some executives may push the desire to justify their lease costs by filling up their offices. This phenomenon may be amplified if the office location is a part of the company's identity - many of the big financial institutions may have a strong desire to keep their landmark or iconic lower Manhattan addresses, but can't justify leaving the offices empty.
Alternative to layoffs
If a company over-hired during the second half of the pandemic, and the number of employees is no longer justified by the business, the company may be forced to reduce headcount. Instead of imposing layoffs, the company may attempt to use a more restrictive RTO policy in the hopes that employees will choose to quit rather than return to the office.
The Bottom Line
A company may have multiple reasons for instituting an RTO policy. The justifications shared by a company may not be an exhaustive list.
Up Next
Our Shameless Pitch
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