Versapay gathered 300 of its remotely working employees from around the country on Bentonville, Arkansas, last summer for a four-day, company-paid gathering to promote connection and camaraderie. Attendees got hotel gift bags; retailers visited them with chocolate tastings; they were regaled by a variety of musical acts. “We literally took over the town and creative spaces where people could serendipitously run into each other in the town square and in a naturally beautiful environment that opened up creativity,” says Carey O’Connor Kolaja, CEO of the Atlanta-based fintech company for accounts receivable. “We were thoughtful about how we curated every moment. It was a great time of shared experiences. It helped unite an organization that had been completely distributed.”
Even though having everyone together proved so productive and fulfilling, Versapay went right back to its remote-only work mode, with 380 employees scattered in home offices all over the Southeast and a skeleton crew in its Atlanta headquarters. “We looked at the evidence around when you’re forcing employees to come back to the office, and it creates a lot of issues with recruiting and attrition,” explains O’Connor Kolaja.
Yet, plenty of high-profile companies are issuing mandates for white-collar employees to spend more time in corporate offices. Amazon recently joined earlier movers UPS, Boeing, JPMorganChase, Walt Disney, BlackRock and Chipotle in boosting their return-to-office (RTO) requirements from three days a week to four days. And Stellantis reversed its 70 percent remote work policy, calling everyone back to the office for three days a week after a profit warning prompted a shake-up of top management of the Paris-based automotive giant—parent of the Jeep, Chrysler, Ram and Dodge brands in the U.S. “We need to be pragmatic, and we’re recalibrating,” Stellantis CHRO Xavier Chéreau told Bloomberg. “If there’s a difficult project that needs attention, then it’s all week in the office.”
Others have gone even further, eschewing remote work altogether. Tesla CEO Elon Musk brought his hallmark extremism to the issue, dubbing remote work “morally wrong” when he required staffers to be back in the office for at least 40 hours a week beginning in 2022. Coldwell Banker Warburg summoned employees back to their offices full-time even during the pandemic. “The decision wasn’t just about maintaining operations but about building a stronger culture,” explains Kevelyn Guzman, regional vice president. “Real estate, especially in the New York City luxury market, is such a high-touch business that being in the same space fosters collaboration and connection, both among agents and with clients.”
All-In on All Back
United Wholesale Mortgage has required all 7,000 employees at its Pontiac, Michigan, complex to be on campus five days a week since the pandemic lifted. “We know that we are better together,” says CHRO Laura Lawson. “Our unique culture thrives on in-person interaction, which we believe fosters stronger relationships, more effective communication and increased productivity.”
To make the policy palatable, the company allows employees to adjust their start and end times for up to 60 minutes, provides an on-site physician, runs a mammoth sports complex next door and provides two floater holidays a year in addition to standard paid time off and holiday time. Despite such efforts, 92 percent of employees globally still want to work fully or partly remote, according to recent World Economic Forum data, with 68 percent preferring a hybrid arrangement and 24 percent wanting to work fully remotely. Plus, 82 percent of Fortune 500 companies still offer flexible work, while only 18 percent require full-time in-office work, according to the most recent report by Flex Index.
Finding Flexibility
As a result, many companies are resigned to continue in hybrid mode even if they’re not excited about it. Many are taking the approach of Atrium, a San Francisco-based software company that has nudged its workforce from two office days a week to three. “We have a nice compromise, being able to offer both the luxury of remote work and the power of in-person work,” says Rebecca Cenni-Leventhal, founder and CEO. “Maybe there will be a time when we go to four days a week, but today, allowing my teams to be in a hybrid setting allows us to capitalize on the best of both worlds.” For Cenni-Leventhal, the value in face-to-face interactions is “simple things like a cup of coffee in the kitchen, like meeting someone you didn’t know who’s working on another team and sharing an idea.”
—Rebecca Cenni-Leventhal, Founder, Atrium
BambooHR also bumped up its in-office requirement, adding a fourth day to its previous three-day hybrid mode. “We want to be explicit with what we think success looks like,” says Anita Grantham, head of HR. “We see salespeople come in and achieve their quotas faster and make more money than people who work at home. We think that’s what’s required for them to succeed on the job.”
Others aren’t making mandates, instead finding ways to encourage and entice employees back. The hybrid policy at Marvin Windows calls for two or three days a week in the office, but CEO Paul Marvin says “many employees prefer to work in the office full-time.”
Helping tremendously is the fact that, just before the pandemic, a renovation of company headquarters in Warroad, Minnesota, added amenities, including an employee food garden, local cooking demonstrations, an outdoor walking path and club, an on-campus bike-sharing program and a room equipped with a hospital-grade breast pump and accessories for nursing guests and employees.
The company also augmented its collaboration areas with “me” spaces. One called Northwoods Retreat is stocked with puzzles and books, with an environment that encourages meditation.
The Home Team Advantage
At the same time, many chiefs still swear by a fully remote model. Paycor retains a remote-first model for its 2,800 employees and has even announced plans to sell its 136,000-square-foot headquarters. The company is creating a hub for training sessions, large-group meetings, corporate events and hosting workers from across the U.S. “Having the space for in-person collaboration remains crucial for maintaining strong connections and productivity,” says CEO Raul Villar Jr.
Worksuite is also sticking with a a remote-only model. “My entire development team is in Poland, but they know exactly what my expectations are,” says Ray Grady, CEO of the San Francisco-based provider of workplace software. “You need to have the right tools, be super thoughtful on culture and vision and get an aligned culture. It’s more difficult remotely than if everyone is together. But if you’re able to build the right infrastructure and true culture, it opens up more opportunities to grow and scale that business than traditionally being in the office.”
Remote models can also be a recruiting advantage, says Elin Thomasian, senior vice president at labor-market consultants TalentNeuron. “Companies take advantage of skill sets they can acquire that otherwise they wouldn’t be able to. They’re sticking to a remote type of environment because they’re seeing they can attract wide and diverse talent globally, with all the advantages of skills and lower costs.”
Exploring Options
The key to navigating the whether-to-return conundrum is understanding the business drivers for your decision, says Thomasian, who advises designing a clear strategy, with unambiguous communications and a value proposition. Things CEOs should take into consideration:
Forging your own path. Having the right security architecture enables AvidXchange, the largest software company in Charlotte, North Carolina, to maintain remote work, says CEO Michael Praeger, “never letting any third parties come into our network infrastructure to work on a portion of our code.” The company has settled into a hybrid mode of three days a week. While engineers “with a whiteboard in a room are 50 percent faster in their innovation cycles than if you have them working Zoom, those types of collaboration sessions for engineers don’t happen five days a week,” explains Praeger.
As BambooHR’s Grantham notes, “People don’t need to follow the trend of Big Tech [for more RTO] but ask the question: What work mode is best for your mission, customers and people? So often, tech companies let Amazon and Google set the pace. Let’s be independent thinkers and figure out what works best for our own products and services.”
Junior-level employees can benefit especially from RTO mandates. “It’s a detriment to start their career in a remote environment where the only office culture they have exposure to is on the screen,” Thomasian says.
Performing soft layoffs. A great suspicion of Amazon’s in-office mandate is that it’s an easy way to trim a bloated workforce amid recent tough times for tech giants. “Some companies certainly are using RTO as an attrition tool,” says Thomasian. “‘Strong performers who are loyal to us will return,’ they say. That’s probably not the best talent strategy and doesn’t lead to the best outcomes.”
That approach can affect morale. In a BambooHR survey, 37 percent of respondents in leadership roles believed their employers had undertaken layoffs in the past 12 months as a result of too few people quitting in protest of RTO mandates. Nearly the same number thought their management wanted employees back in the office just to monitor them more closely. A full 42 percent of respondents said they show up solely to be seen by bosses and managers, not to work more effectively.
Making the place a magnet. Some companies spare no expense in trying to lure people back to the office. “We make sure the food in the cafeteria is good, and we subsidize— though not provide free—meals,” says Nathalie Grenache, CHRO of French drug maker Sanofi, with U.S. headquarters in Bridgewater, New Jersey. “And from a tech perspective, we make sure the Internet is very good, and we have the right technology in place. People say they come to the office because it’s quieter, and they have all the space they need.”
Northwestern Mutual keeps adding to the appeal of its downtown Milwaukee campus, where it opened a 550-foot-high, $450 million new tower in 2017 and is now investing another $500 million in consolidating 2,000 employees from a suburban office. The Tower and Commons were constructed with collaboration in mind, with plenty of flexible workspaces and amenities, so the pandemic delivered a blow. While maintaining its three-times-aweek hybrid policy, Northwestern Mutual has sweetened the pot with recent moves, such as opening a 4,000-square-foot convenience store on the campus.
—Nathalie Grenache, CHRO, Sanofi
BambooHR just turned over 100,000 square feet of space—of which it was using only 30,000 feet—to lease 50,000 square feet in a new building. “We went from 50 people a day to 200 a day, especially on Tuesday and Thursday,” Grantham says. “They’re flocking because all the people are there, with great food and amenities, light and bright and new and airy and fun.” However, basics may be the most important element of a compelling workplace. “It can’t anymore be just meals or CEOs acting as baristas,” says Brandon Holden, CEO of Eptura. “It has to be around creating a frictionless experience to drive their productivity, with technology, space, desks and rooms that allow workers to collaborate more efficiently and be more productive.”
But making buildings nicer is far from certain to lure people back, cautions Michael Silver of Vestian. “There’s a feeling that if I’m a CEO and we’re going to move to a nice building, my employees will come back to work because they have amenities they didn’t have before, including better cafeteria facilities, maybe gym facilities, maybe a more inviting lobby,” he says. “But those things haven’t been working. People are investing in buildings and repopulating it that way, and it hasn’t been worth the money.”
Allow a slow crawl. Many CEOs believe workers will continue to come back to the office voluntarily. “They realize they miss the camaraderie, they’re not as productive and can’t coordinate with team members,” says Fred Burke, CEO of Guardian Pharmacy Services. “On their own, they’ve decided to be in the office more. It has resolved itself without a mandate.”
This approach can include some tugging. Corpay, for example, has a policy that “says that if you’re going to work remotely, you’re going to work remotely where you don’t move to another state or country,” says Crystal Williams, CHRO for the fintech with about 5,000 U.S. employees. “We want you to be within commuting distance of the office to which you’ve been assigned.”
Proceeding with caution. “The way the company treats employees affects their loyalty,” Thomasian says. “If they believe there’s no empathy for employees and it isn’t a people-first culture, and is more business-driven, companies will see some good people look for other opportunities.”
Corpay’s Williams says, “Almost everyone I interview asks if they’re required to be in the office full-time, and we’ve had a few say, ‘Thank you very much, but no thank you’ if they’re required to be here full-time.”
At particular risk are employers with workers proficient in AWS, Javascript, Microsoft Azure and other computing skills. “There’s a lot of scarcity of skills, and companies making blanket rules are doing themselves a disservice,” Thomasian says. “On average in the U.S., 50 percent of those skills are remote.”
Stricter RTO policies may also hinder DEI goals. “Women gained a lot of flexibility with Covid,” Sanofi’s Grenache says. “So there’s a balance between creating the right culture for employees and making sure it doesn’t affect diversity.”
Keep pushing. Most CEOs still yearn to be able to see their employees for real. “If you keep putting pressure on in a subtle way, one of these days you’ll end up with 75 percent [attendance],” Silver says. “This is the condition that businesses will have to wait out.” OneStream Software CEO Tom Shea is willing. “We’re seeing more and more attendance,” he says. “If employees are doing complex engineering, for instance, they need to be in the room together. It’s the best way to convey thoughts. We see teams adapting to what makes them efficient. It works best for us as a company to be around each other.”