One of the biggest impacts of the Covid-19 pandemic has been the government guidance to work from home to reduce transmissibility. The government has announced that guidance to ‘work from home’ will remain until restrictions are relaxed which is currently scheduled for 21st June. Many though have enjoyed the flexibility of home working and the benefits it’s brought so should flexibility remain once the danger has receded?
It is evident that not every profession has the ability to have flexible working, there’ll always be bobbies on the beat, posties on their morning route and its difficult to imagine many butchers wanting to work from their kitchen but what about the national army of office workers who already use cloud-based systems? We’ve proven it’s possible in 2020, so why not?
‘Work from home’ is a threat to city centre landlords
The thought of major firms downsizing offices is sure to send shivers down the spines of commercial landlords. Thousands of desks currently sit deserted in areas of what was prime real estate as employees have sent their workers to their living rooms, spare bedrooms and garden studios. Some companies are even beginning to consider moving out of London or even out of offices altogether to save on expenses. Making this change permanent will impact the economy but this won’t necessarily be a negative impact overall.
This could well be the rebalancing of wealth that many have been calling for however, they will not be able to do it without great resistance from those benefiting most from the status quo. Howard Dawber, the Managing Director of Strategy at Canary Wharf Group, expects 100% occupancy in the district to return. Canary Wharf Group own nearly 100 acres of land on the Isle of Dogs and are currently expanding into the new Wood Wharf district so could be under pressure to rethink their model.
What Dawber says runs contrary to what some of their biggest tenants are saying though. JP Morgan co-President Daniel Pinto says there is ‘zero chance’ of all staff working in the office 100% of the time and HSBC have said the company will move to a ‘hybrid model in the future’. Dawber has conceded that he does expect flexible working to become the norm but maintains that they are missing life in the city.
I think now people are really missing that opportunity to collaborate with and just see their friends in the office, to get your hair cut, to go and get a good coffee at lunchtime, and to do all the life admin things you can do in a city centre.’Howard Dawber, Canary Wharf Group
Dawber isn’t the only one to play down the future of work from home. The CEO of Goldman Sachs is vehemently against workplace flexibility calling it an ‘aberration’ and that it is something they will ‘correct as soon as possible’. Some employees have complained that the older generation did not have an understanding of modern needs however Mr Solomon raised the concern that new recruits wouldn’t get the “direct mentorship” that they need. Others have also complained that team cohesion suffers from a lack of a communal working environment.
Unfortunately for those desiring more flexibility after the pandemic, if your employer is insistent on working from the office you will be required to come in if your employment contract defines your place of work. At present, the employer has a duty of care to employees meaning you should work from home where possible but once the threat of infection has receded that will no longer be a concern.
Working from home could benefit employers as well as employees
Just because they can enforce office working, does it mean they should? The answer is an overwhelming no. Staff enjoy a better work/life balance and when looking at career options, a company having a flexible working arrangement is more likely to attract new employees. A report has even suggested that those working from home take 2.4 fewer sick days and 84% would even work through illness if they are at home.
Companies may soon find they will struggle to attract new employees and could lose the ones they already have with 28% of workers saying they’d change to a job that offers remote working. The same research even indicates that some workers believe themselves to be more productive but also that a portion believes some colleagues may not be working hard enough because of home distractions.
Perhaps though this is just more evidence that we need to continue to shift our thinking and trust the people we work with more. If employees feel more trusted by their bosses then this could reduce pressure enabling higher efficiency.
Not all will agree that working from home reduces stress. This is backed up by research by Microsoft and YouGov entitled Work Smarter to live Better who found that 65% missed social interaction the most and also, 53% felt that this newfound flexibility meant having to be available at all times.
‘Work from home’ could reduce the cost of living
London is seemingly at capacity and pushing worker’s finances to the limit. So having suffered from brain drain for so long could some of the nation’s rural talents be set to return to their countryside origins? Many have got accustomed to their new lifestyles, enjoying the flexibility that it brings. Research from Total Jobs analysis of ONS data suggests that 26% of Londoners want to continue working from outside of the city and 38% are considering where they live as a result of the pandemic.
It is not just rural living that attracts people, some workers are now even moving abroad where the cost of living is cheaper. This however does create tax implications both for the employer and employee. If the move is temporary then it is unlikely to cause problems but should the move become permanent you may be liable to pay local income taxes and it also runs the risk of the employer being permanently established in that country making them liable to corporate tax.
For those happy to keep things more domestic, having an employer that allows you to work from home whilst living out of the big cities could bring financial benefits. London property is notoriously expensive and living elsewhere could offer more space for less money with London properties not necessarily suited to home working. Add to that removing the cost of commuting and the employer could find themselves with more money in their pocket which offers hope to retailers. Not everyone will have the flexibility to move away for reason such as family but for those who do there is a lot to be gained.
It’s not just money you’d save, not having to commute twice a day will save nearly an hour in each direction on average. If as we’ve seen people would consider working longer there could even be a boost to the economy. If 57% of workers spent the time they commute working then there’d be a £20bn boost to the economy.
Of course many would prefer to use the extra time for leisure or simply additional sleep allowing individuals to be more rested for when it is time to work allowing the best of both worlds. Workers with families will probably be the keenest to continue reaping the benefits of having additional time on their hands. If employers can take their flexibility a step further this would allow parents, particularly mothers, the chance to continue advancing their careers who’d otherwise miss out on job opportunities.
Perhaps the biggest gain to be had from ‘work from home’ arrangements are the environmental benefits. Carbon emissions could be reduced depending on the distance they commute from. For those who have a short commute it could actually increase their carbon footprint due to extra residential energy consumption however commutes into the cities are normally substantial and the research found that if everybody capable of working from home could do so for just 1 day a week, global carbon dioxide emissions would decrease by 1%.
From a technology point of view working from home could bring additional risks to data protection. Companies would be required to change the way they manage security as there could be a renewed opportunity for hackers. Further to this, we are all familiar with the bane of Zoom calls – poor internet connections. Many areas still suffer from insufficient internet speeds with up to 20% of the country still not having access to BT Openreach’s fibre-optic broadband.
From a legal point of view we can see how employment, data protection and tax laws could be brought into questions so perhaps then the solution is not a binary ‘work from home’ or office working but a hybrid of the two options. The flexibility that allows companies and employees to save time and money whilst maintaining the level of scrutiny that some bosses desire. This could allow time for the infrastructure to adapt and eventually permanent working from home may become the new normal.
Alston Asquith have offices in London and Hertfordshire and can arrange a call to provide some initial advice.
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