Three Ways Return-to-Office Mandates Risk Your Bottom Line

Many CEOs consider return-to-the-office mandates desirable, believing they will foster collaboration, increase oversight, and improve company culture. However, a recent academic study shows a global trend of return-to-the-office mandates failing. Companies are facing legal challenges ranging from being sued to employment tribunals awarding large compensation packages to workers who refuse to return. There are benefits to a return – but do they outweigh the risks? This article outlines the main downside risks that need to be considered and gives six steps companies considering a return should take.

Risks to Employee Retention and Attraction

The most evident risk of enforcing blanket return-to-office mandates is the loss of current employees and the difficulty of replacing them. Employees are resisting a return to the office. 97% of workers would like to maintain at least part-time remote work for the rest of their careers.  Many workers have adapted to remote work, appreciating its flexibility, reduced costs, and better work-life balance. 41% of Millennials and 40% of Gen Z workers now say they would not accept a job that didn’t have flexibility.

By requiring staff to return to the office, employers risk:

• Losing Talented Employees: Employees who value remote work might seek opportunities elsewhere, losing skilled and experienced personnel.
• Decreased Employee Satisfaction: Mandates negatively impact morale, reducing job satisfaction and productivity.

Additionally, such policies make it harder to attract new talent. Flexible working conditions can be a significant advantage in a competitive job market – and remote work allows you access to a much larger pool of talent.

Productivity Risks

Pre-pandemic, much of the resistance to remote work was the assumption that it would harm productivity, but the reality for many companies has been a different story. Many employees can be more productive when working from home due to fewer distractions and a better work-life balance. For these employees, returning to the office can lead to Decreased Productivity. Employees might face longer commutes, increased stress, and less personal time, which can contribute to burnout and increased absenteeism.

Legal Risks

The legal risks of a return to office mandate are perhaps the most underestimated. If a remote working arrangement is in an employee’s contract, they have the right to refuse the change. However, many employers are unaware that even if it is not explicitly stated in their contract, flexible work could still be considered an ‘implied term’ of employment, especially if the role was remote when the person was hired. That could be most hires made in the past four years. In the UK, Nationwide faced a £350,000 compensation payment after making a remote employee redundant for refusing to return to the office. An employment tribunal ruled that the return-to-the-office mandate was discriminatory and that the justification given for it was based on “subjective impressions” rather than actual evidence.

Health Risks

We should also not forget the key driver of the rapid growth in remote work—preventing the spread of disease. In-person environments act as a disease transmission vector, so returning to them increases the future risk of outbreaks and infections. We’ve all been aware of that endless ‘office cold’ that does the rounds, or when everyone in a team seems to go down with the same bug at the worst possible time. New research by the Ulster University Economic Policy Centre finds that remote workers take fewer sick days than their in-office counterparts, which the CIPD attributes to a reduced exposure to contagious illnesses, noting fewer cases of contagious diseases like norovirus reported during lockdown. A shared environment means companies who have returned to the office are far more vulnerable to future illnesses and pandemics, from new Covid variants to norovirus, as an outbreak spread in the office may affect several teams or employees simultaneously.

Covid has not gone away, and while it remains endemic shared spaces carry higher risks to health. We now know that even mild or asymptomatic covid infections can lead to the debilitating long-term disability of long-covid, and with 28% of  COVID-19 infections leading to long-term health damage, this has legal implications for return to the office mandates.

“An employee may have legal protection from any detriment, including dismissal, if they reasonably believe that returning to the office would put them at risk or serious and imminent danger” – Stephen Jennings, Tozer Solicitors.

If an employee can show they reasonably believe there is an increased risk of infection, then a return to office mandate may not be enforceable. However if the company can show that they had reasonably mitigated the risk then it may not be considered unfair dismissal.

Considering a return to the office? Take these Six Steps 

If you are planning a return to the office, consider the following practical steps to help minimise your downside risks and liabilities.

1. Evaluate Productivity Metrics: Use data to assess whether remote work has impacted productivity and make decisions based on evidence rather than assumptions. If you can’t show that a decision is evidence-based, it may be ruled unreasonable at a tribunal. A return should be a business decision, not a preference.
2. Assess Employee Preferences: Conduct surveys to understand your employees’ preferences and concerns regarding remote work versus office work. Consider market trends and their impact on attracting and replacing staff.
3. Take Legal Advice: There are now a number of test cases and precedents in the UK and globally. Unfortunately, the advice is not always clear-cut. For example, there is no specific time after which a tribunal might find remote work has become an ‘implied term’ and different judges may differ on what constitutes a justified rather than subjective reason.
4. Measure cost/benefit: Physical spaces have high hidden costs – from rental commitments to reducing your available talent pool to those with the will ability and budget to commute.
5. Health and Safety Measures: Implement robust health and safety protocols in the office to mitigate the risk of disease transmission. Distancing, hand-sanitation and allowing masking are preventative measures even outside pandemic lockdowns. Strictly enforce the policy if someone feels ill they do not come in and spread it.
6. Adopt Flexible and hybrid Work Policies where possible. Research shows that Hybrid work models in which people can choose when, where, and how they work can help maintain employee satisfaction and the benefits of a shared space, giving you the ‘best of both worlds’.

Flexible Future

Flexible working is here to stay. Blanket return-to-office mandates, especially five-day ones, are unpopular and carry significant downside risks, but a hybrid model can allow you to enjoy the benefits of in-person working, reducing your legal and financial downside risk and helping you attract and retain the best talent. Ready to put it in place? read our guide to introducing flexible work.