Since hybrid and remote working models have become a normal situation during the last two years, it has become increasingly favorable to work from outside a physical office space. Companies are now paying higher wages in order to get employees back to offices. Actually travelling to work is perceived as an inconvenience after so many months of working from home. Many companies are renting office spaces that they could barely occupy during the pandemic and are therefore eager to get employees back to the office. Throwing more money at the problem is one approach.
There have been a lot of discussions on whether remote workers should be paid lower wages, especially if they have moved to lower earning areas. Less attention has been given to in-office workers. Should they be paid more for coming to the office? Surveys show that most employees have little appetite for going back to the office full time. More than half of remote workers admitted in a survey that they would consider quitting their jobs if their companies tried to force their return to the office.
Many companies now offer hybrid models of two or three days in the office and the rest remote, and they even consider offering some compensation for coming back to the office. However, many employees value flexibility far more than compensation. In addition, creating new compensation models for remote and in-office workers could increase pay gaps for women and minorities, creating new equity problems.
Pay can be used for companies to signal where they place value. If companies feel strongly about in-person connections right now, pay rises can be a useful tool. Pay rises are much better perceived than pay cuts. So instead of remote workers being forced to take pay cuts, it is more likely to see gains for the in-office staff. Quite some companies are talking about a 10% pay difference between fully remote workers to in-office employees.
In addition, some companies consider daily allowances for commuting. Many people absorbed the travel costs they had before the pandemic into their living expenses while they were home and now that feels like an additional expense.
Some companies also realized that people tend to choose days other than Monday and Friday to go to the office in hybrid working models. In order to coming to the office on those days, they have breakfasts, lunches and drinks after work.
Also, coming to the office encourages collaboration and creativity and companies therefore offer other benefits such as free gym memberships and social programs. Some companies even offered luxurious prizes to workers coming back into the office such as a Tesla and trips to Barbados.
However, these incentives and pay rises will most probably be a transitionary phenomenon. It is a phase of coming off the pandemic into the post-pandemic. Companies will not hire new people into fully remote roles and therefore in a few years it will be probably be normal to have hybrid roles.
There are clear demographic differences in who wants to come back to the office and who doesn’t. 52% of women want to work at least mostly remotely, compared to just 46% of men, according to a report from Future Forum Pulse. Therefore, pay rises for workers to go back to the office may cause a stronger pay gap between men and women.
A study from Switzerland’s International Workplace Group found that 72% of workers preferred long-term flexibility in where they are based over a 10% pay rise. Hence, it may not be enough to offer pay rises to get people back to the office. On the anonymous professional network Blind, users were asked whether they would prefer a significant pay rise over a work-from-home option and the result showed, that 64% chose flexibility over pay. It seems that for some workers, the pay rise would need to be very, very significant to overcome the benefits of working from home.
