Office, hybrid or home? Businesses ponder future of work

The government could announce an end to its work from home guidance in England next month, leaving companies with three broad choices: bring everyone back to the office; introduce a flexible working regime; or allow people to work from their home office, kitchen table or garden shed permanently.

Here we look at the pros and cons of each option.

1. Back to the office

Major investment banks have taken some of the most hardline positions on return-to-office plans, meaning staff will soon have to return to their daily commutes into London.

The boss of Goldman Sachs, David Solomon, dashed bankers’ hopes of splitting their time between home and office in February when he called remote working an “aberration” that needed to be corrected “as soon as possible”.

Morgan Stanley’s chief executive, James Gorman, told his New York bankers this week that anyone who felt safe going out to a restaurant should be returning to the office.

Gorman said the bank would take a different approach in countries such as the UK, where fewer than 25% of its 5,000 London staff have been going to work in person, due to stricter Covid restrictions, but insisted offices were where bankers learned their craft. “That’s where you build all the soft cues that go with having a successful career that aren’t just about Zoom presentations,” he said.

Goldman’s US staff marched back to their desks on Monday and its 6,000 UK bankers are expected to return to the Plumtree Court offices in London as soon as government work from home orders are lifted, potentially on 19 July.

About 30% of Goldman’s UK staff are going into the London office on a regular basis and are being tested twice a week by on-site medical staff as part of safety measures. While it has stopped short of demanding UK staff disclose their vaccination status, as has been asked of their American counterparts, an anonymous survey revealed “the majority” of its London workforce will have had at least one jab by next week.

Solomon is reportedly concerned that staff have been abusing work from home privileges, citing an incident last year when a junior employee approached him in the middle of the working day while they were dining in the Hamptons – 80 miles outside New York City. The chief executive said he was particularly worried about how to train the next generation of bankers if most staff were working from home.

The JP Morgan chief executive, Jamie Dimon, has also raised concerns about a lack of mentoring for young staff and a small drop in productivity on Mondays and Fridays. Likewise, the Barclays boss, Jes Staley, has bemoaned the challenges faced by young graduates and new hires, who needed to be immersed in the “culture and the values” of the bank by meeting colleagues face to face.

2. Hybrid working

For the majority of large corporates, the future is hybrid. Some of the UK’s largest office occupiers, from the big four accountancy firms to major tech firms, all intend to allow more flexible working after the pandemic, with staff splitting their time between their desk and a remote location.

Working from home is increasingly being demanded as a permanent arrangement by staff, especially younger workers. But company bosses are also aware of the bank bosses’ argument: the benefits of bringing teams together in a communal workplace to foster collaboration and corporate culture, while also helping to train younger employees and new starters, who may not have the luxury of a dedicated workspace at home.

As a result many corporates have opted for the compromise of hybrid working.

The accounting firm PricewaterhouseCoopers has announced a flexible working policy for its 22,000 UK staff, allowing them to split the week between their home and office, which the chair, Kevin Ellis, said was a “direct response to soundings from our people”. The company expects workers to spend 40-60% of their time with colleagues, whether at PwC’s offices or on client visits, and with the freedom to work remotely the rest of the week.

Despite the firm stance taken by Goldman, some City firms have gone hybrid too. The FTSE-listed fund manager Schroders is among those that have told staff they will not be required to return to the office full-time.

The consumer goods group Unilever, the owner of brands including Dove soap, Marmite and Ben & Jerry’s ice-cream, has said staff will never return to a five-days-a-week office pattern. Its chief executive, Alan Jope, has called the previous approach “very old-fashioned”.

Even technology firms, which should be at the vanguard of video conferencing, are favouring a half-and-half approach. Google’s chief executive, Sundar Pichai, announced a hybrid policy in May, with staff spending about three days in the office “and two days wherever they work best”, similar to the approach adopted by Amazon. However, he added that once the pandemic is over “we will be able to come back together in our offices to see all the people we have missed”.

More than two-thirds (66%) of businesses continue to offer some remote working, according to a survey from the British Chambers of Commerce. The poll of more than 900 businesses showed almost three-quarters of firms expected at least one team member to continue working remotely over the coming year. However, companies’ ability to offer flexible working varies greatly according to sector, and is far more prevalent in service businesses such as financial or law firms, and far less simple to implement in hospitality, retail or manufacturing.

3. Permanent remote working

During the pandemic some companies have seized the opportunity to wave goodbye to the office for good, slashing rental costs. Bosses have sent laptops and monitors, and in some cases desks and office chairs, to their workers, equipping them to work from home for good.

The outsourcing firm Capita announced last year that the majority of its 900 new hires, taken on to manage London’s congestion charge and low-emission zones for its contracts with Transport for London (TfL), would be allowed to work remotely and encouraged to do so from home. Capita has also expanded its office closure plans as part of a cost-cutting drive, with the goal of permanently closing a quarter of its office space by the end of 2021.

Yet just 4% of firms across all sectors intend to have their staff work exclusively from home, excluding major meetings and away days, according to a survey by the Federation of Small Businesses.

“Smaller firms tend to be more flexible and adaptive than big corporates by nature, enabling teams to arrive at arrangements that work for all,” said the FSB’s national chair, Mike Cherry.

Some larger companies have also decided to adopt permanent remote working, and not just as a means of cutting costs.

Facebook’s chief executive, Mark Zuckerberg, told workers earlier in June that all full-time employees would be allowed to work remotely if their job allowed it, something he intends to do himself 50% of the time.

“We’ve learned over the past year that good work can get done anywhere, and I’m even more optimistic that remote work at scale is possible,” he wrote in a staff memo.

About one in three staff at Natwest Group, representing more than 20,000 workers, will become largely remote workers, able to live and work anywhere in the UK and only required to attend their office in person for two days a month.

The number of remote working roles advertised in the UK has risen steadily over the past year, reaching approximately 145,000 jobs in May, equivalent to about 5% of advertised jobs. This means the number of remote jobs being advertised has more than trebled compared with last August, and increased sixfold since February 2020, according to the labour market data company Emsi.

However, talent consultants warn that working from home does not suit all staff, with some finding it hard to remain productive and motivated.

Few workers want to do away with visiting their workplace, said Natalie Douglass, the director of talent strategy consulting at New Street Consulting Group.

“What a lot of workers have discovered over the past year is that having the option to work remotely can be good but not having the option to go to the office at all can make a job much harder,” Douglass said.