Work From Home, Be Laid Off Less?

Despite some research to the contrary, many workers have maintained since the pandemic that they are more productive at home. But a new survey offers them an even more persuasive argument for staying on the couch.

According to a surprising survey from Startups.co.uk, the odds of remaining employed increased the more people stayed out of the office. Indeed, the survey shows that only 16% of UK firms that operated with entirely remote staffs laid off any workers last year—as opposed to the 38% of companies with fully in-office staffs that did so. One factor: Firms with people in the office bear much higher real-estate costs.

“Some companies with large offices are cutting costs by reducing staff and saving on rent as well as salaries,” says Stuart Richards, Korn Ferry’s sector leader for consumer products across the UK and EMEA.

To be sure, although more firms worldwide are mandating that people return to the office, British workers continue to resist at a higher rate than their counterparts in many other countries. According to one survey, just 30% of UK companies are working fully on-site, as opposed to 57% before the pandemic. Given high inflation—and increasing commuting costs—that percentage may not change anytime soon.

Experts say that executives at entirely office-based organizations are typically older and more experienced, and that they’re likely to have survived tough economic times in the past. That combination may drive them to take more aggressive action amid a soft economy. “They are more likely to make layoffs sooner,” says Drew Hill, a senior client partner at Korn Ferry who specializes in helping CEOs and their teams manage talent and develop new behaviors in complex organizations.

Another key issue may have to do with the legal implications of laying off remote workers. During and immediately after the pandemic, many employees were told they’d be allowed to work from home. A company that heavily reduces its remote staff could be accused of discrimination, experts say, and to avoid litigation, executives need to be careful that they base any decision to downsize on individual circumstances.

Working from home has its disadvantages, however. Another survey showed that 41% of respondents thought they were less likely to get a promotion or a pay raise if they didn’t spend enough time in the office. “If you’re happy with that status quo of lower raises or infrequent promotions, that’s fine,” Hill says. “If not, you may need to get into the office.”

It’s also the case that junior staff, including recent graduates, could suffer without the hands-on training they’d receive at the office, under the guidance of more senior staff. “If you make a work mistake in your bedroom, it's odds that no one in the company will know about it,” Richards says. No one will be there to explain what you did wrong, or why, he points out, or how to perform up to standard. “You can’t learn,” he says.

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