The hybrid working genie is out of the bottle. Despite the insistence of some in the corporate world (and many more in the corporate real estate world), employees no longer accept being forced to work in offices for reasons that are, at best, obscure and at worst, simply untrue. As companies around the world struggle to balance the relative merits of office and remote working, new empirical research has begun to unpick some of the threads of the intertwining factors that govern how business leaders think and act around hybrid working.

The remote work side of hybrid working has well established benefits in employee job satisfaction, work-life balance and productivity, while the office side of hybrid working has opposing benefits in collaboration, relationship formation and informal interactions. These have been known for some time. But now, perhaps spurred on by the mounting costs of maintaining corporate real estates, many companies are beginning to demand that workers return to offices, perhaps in an effort to justify their high spends. Reasons for returning to offices have been inconsistent and often ill-justified. They rely on vaguely defined concepts like “culture” and “collaboration” without a lot of justification for what problems a lack of these is causing or what will happen when they improve. In many cases companies have done little to explain their decisions, merely ordering people to return to offices if they want to keep their jobs.

Now, for the first time, a scientific analysis has been conducted to uncover what is actually behind return to office mandates and what is motivating business leaders to pursue them. The analysis relies on publicly available statements made by companies about why they are returning to offices and business statistics that describe their performance. Analysing data from over 90% of the S&P 500, the researchers examined a range of factors for each company including: CEO ownership of the company, CEO power level within the company, company profitability and work-life balance, among others.

After completing their analysis, the researchers found that companies that enforced return to office mandates did not have any related benefits to their financial performance, but did suffer from greatly reduced employee satisfaction. This suggests that companies using this as a reason are doing so erroneously, or perhaps even as a cover for other reasons. The CEOs that wielded the most power in companies (those that tend to exercise the most control over employees) were also the most likely to have RTO mandates. The researchers conclude that control over the day-to-day activities seems to be the driving force of RTO mandates rather than any identifiable objective benefit to companies, and that if these benefits do exist, they are currently not evident. The authors note that many companies may be damaging employee satisfaction for little or no actual benefit, but that more research is needed to fully understand in detail what the true motivations for office mandates are.

In the meantime, it seems that companies should carefully consider why they are asking employees to return to offices. Companies go out of their way to hire intelligent, thoughtful people who are going to notice when they are told to return to offices without any clear reason why. It can therefore pay dividends to use workplace data to understand clearly what your company needs and work out a plan to support them working how they work best. Don’t sacrifice your company on the altar of control, almost certainly losing employee satisfaction for uncertain other benefits that in practice do not materialise.

Reference: Din, Y. & Ma, M. Return to Office Mandates. https://news.theregistrysf.com/wp-content/uploads/2024/01/SSRN-id4675401.pdf