Elon Musk has always been ahead of the game. Back in 2022 he ordered all Tesla employees back to the office full-time, declaring remote work a moral issue that privileged the "laptop class". He did the same at Twitter when he bought the social media giant, although, given he went on to sack about 80 per cent of the workforce, Musk didn't really need to worry about retention.

Other employers have taken a more softly-softly approach recognising they may lose staff over office mandates. However, it appears things have now reached a tipping point in Australia with the vast majority of employers drawing a line in the sand over minimum office attendance.

A survey by recruitment agency Robert Half towards the end of 2023 found 87 per cent of Australian businesses have mandated some level of return to the office, with minimum attendance requirements varying.

Only 19 per cent insist returning to full-time attendance. Those remaining have opted for:

• Four days (28 per cent).

• Three days (26 per cent).

• Two days (12 per cent).

• One day (2 per cent).

Of those businesses who have mandated minimum office attendance:

• 40 per cent say it is better to have important meetings face to face.

• 37 per cent say productivity is improved when employees are working in the office.

• 34 per cent find it hard to maintain corporate culture with minimal face to face time.

• 31 per cent say they need to make use of office space.

• 30 per cent say it's more difficult to manage teams virtually.

• 25 per cent say opportunities for junior employees to learn and progress is limited by working from home.

When releasing the survey results, Robert Half director Nicole Gorton said the benefits of getting staff back together in offices were undoubtable, but cautioned against strict edicts, saying about 30 per cent of businesses who mandated office returns also reported losing at least one staff member.

"Mandating makes people feel like they have been stripped of this choice," she said.

 

Carrot or stick?

In an effort to enforce mandates, it was reported in November that some major Australian corporations, such as Suncorp, Origin and ANZ, had linked performance reviews and bonus payments to minimum office attendance.

Other businesses approached the same goal from a different perspective - trying to lure staff back. Enticing rather than forcing workers to return is easily the more effective strategy, according to employee rewards platform Perkbox, which tried both. James Arnall, marketing director for Perkbox, which has staff based in the UK and Australia, told the BBC the company initially mandated a four-day return to the office after COVID-19 lockdowns, but after a huge pushback from staff they quickly changed tack. They dropped back to a two-day minimum with a catch - staff who attended the office for more than the designated two days could earn reward points for each extra day. These points could be used to pay for things such as lunch, groceries or a Netflix subscription.

For other employers keen to go down the path of an induced, rather than mandated, return to the office, a US survey offers some insight into what measures may be the most effective. Conducted by video conferencing company Owl Labs, the survey found the top three reasons workers didn't want to return to the office were commuting costs (38 per cent), lack of privacy (34 per cent) and dress codes (24 per cent).

Addressing these pain points could go a long way to boosting attendance while generating goodwill rather than resentment.

In Australia, some companies have started allowing staff to claim back commuting time and costs. At HR firm Flare, hybrid workers can claim up to $500 towards the cost of commuting each year. The Financial Review reported on a fintech company that requires staff to attend the office a minimum three-days a week, but for every day above this that they spend in the office, they can offset their commuting time to earn extra annual leave up to seven days.

And it's not hard to get there. According to McCrindle research, the average Australian daily round trip to the office takes 48 minutes. Adding just one extra day in the office (based on 48 weeks' work a year) would add about 38 hours - or a full working week - in commuting time.

Along with inducements, businesses around the country are also tweaking office spaces to make them more inviting and functional with more natural light, ventilation and greenery, along with nicer kitchens and bathroom areas. Designated quiet work spaces also help address common complaints that offices are too noisy and distracting for deep work.

While some commercial real estate experts predict the five-day working week may never return, businesses that can find a balance and keep staff engaged will emerge the winners.

 

What's driving insurance to new heights?

How to handle a pay rise request

The information provided in this document is a selection of information taken from publicly available sources and is current as at the date specified in the information. It does not contain all information or all public websites that may be relevant to our brokers and their customers. Please note AFG does not provide tax, legal or accounting advice. Any information provided is of a general nature and/or for illustrative purposes. It does not take into account our broker's or their customer's objectives, financial situation or needs and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. AFG encourages our brokers and their customers to consult their own tax, legal and accounting advisors before engaging in or considering the appropriateness of any transaction.