The mandated return to the office has had worse consequences than anticipated.
The mandated return to the office has had worse consequences than anticipated.
The Impact of Flexible Work Policies on Employee Retention
In the wake of the COVID-19 pandemic, companies worldwide were forced to adopt remote work policies to ensure business continuity. This shift sparked a global experiment in flexible work arrangements, with employees embracing the newfound freedom and balance. However, as the corporate world begins to transition back to the office, a new challenge arises: how to retain employees who have grown accustomed to flexible work policies.
The Unexpected Consequences of Return-to-Office Mandates
Recent studies have shed light on the unintended consequences of return-to-office mandates. According to a report by Unispace, nearly half (42%) of companies experienced higher-than-expected attrition rates, while 29% struggled with recruitment. These employers anticipated some level of attrition, but they were unprepared for the serious problems that ensued.
Simultaneously, a Greenhouse report reveals that a staggering 76% of employees are willing to leave their current jobs if their companies revoke flexible work schedules. This sentiment is even more pronounced among historically underrepresented groups, who are 22% more likely to consider other options if flexibility comes to an end.
The gravity of the situation becomes more evident in the SHED survey, which equates the displeasure of transitioning from a flexible work model to a traditional one to experiencing a 2% to 3% pay cut.
The Rise of Flexible Work Policies as a Key Talent Acquisition and Retention Strategy
The collective findings of the Greenhouse, SHED, and Unispace reports provide compelling evidence for the significance of flexible work policies in talent acquisition and retention. Greenhouse found that 42% of candidates would reject roles lacking flexibility outright. Additionally, the SHED survey indicates that employees who work from home a few days a week highly value this arrangement.
- A Columbia Business School professor says boards avoid addressing C...
- Saudi Arabia has the world’s most profitable company and $3.2...
- Tech worker’s LinkedIn post listing past and current salaries...
Employees rank flexible work policies as one of their top priorities, second only to increased compensation, according to the Greenhouse report. The Unispace study introduces another vital factor: choice. Employees are more open to returning to the office if it is their own decision rather than a forced mandate.
Real-Life Cases Confirm the Findings
Real-life examples mirror the findings of these reports. For instance, a regional insurance company enforced a return-to-office policy and began experiencing a worrisome increase in attrition rates. Seeking a solution, the company called upon an industry expert to assist in adapting the plan to a team-driven approach focused on collaboration and mentoring. As a result, attrition rates dropped, and employee sentiment towards the office improved, aligning with the Unispace report’s suggestions.
Similarly, a large financial services company noticed employee turnover despite competitive salaries and growth opportunities. Internal surveys revealed that flexible work policies were a critical factor influencing job changes, as confirmed by the Greenhouse and SHED reports. After adjusting their policies to be more accommodating, the company saw a decrease in turnover and a rise in job applications.
In another case, a late-stage SaaS startup embraced flexible work policies. With expert consultation, the company incorporated these policies, resulting in a significant reduction in employee turnover and increased interest from potential candidates. These success stories reinforce the collective message from all three reports: companies must adapt their policies to offer flexibility to remain competitive in the job market.
Understanding Employee Perspectives
Navigating the changing landscape of work requires acknowledging the human elements at play. Cognitive biases, such as the status quo bias and anchoring bias, subtly shape decisions and perceptions.
The status quo bias, deeply embedded in the human psyche, inclines individuals to maintain current states or resist change. For employees who have experienced the benefits of flexible work, the resistance towards relinquishing these newfound freedoms becomes apparent.
The anchoring bias, on the other hand, leads individuals to heavily rely on the first piece of information offered. For instance, employees who initially joined an organization may have primarily prioritized compensation and job security. However, the pandemic shifted their focus to work-life balance and flexibility, as highlighted in the Greenhouse and SHED reports. A rigid return-to-office policy can make these newly established anchors seem unattainable, resulting in dissatisfaction and an increased likelihood of leaving.
Understanding these cognitive biases can help create a workplace that not only attracts but also retains employees in the new age of flexibility. As we navigate these tumultuous waters, success in the world of business depends not only on numbers and strategy but also on understanding and addressing the needs of the workforce.
Gleb Tsipursky, Ph.D., known as “the office whisperer,” serves as the CEO of the future-of-work consultancy Disaster Avoidance Experts. With expertise gained from over two decades of consulting for Fortune 500 companies and academia, Tsipursky helps tech and finance industry executives drive collaboration, innovation, and retention in hybrid work.
Disclaimer: The opinions expressed in this article are solely the views of the author and do not necessarily reflect the opinions and beliefs of ANBLE.
More Must-Read Commentary Published by ANBLE:
- ‘The global economy is due for a reality check,’ warns the central banks’ bank
- Demand for urban real estate will be challenged for the rest of the decade. Here’s how the world’s superstar cities are projected to fare by 2030
- ‘The Feckless 400’: These companies are still doing business in Russia–and funding Putin’s war
- Great Place To Work CEO: ‘It’s time to acknowledge why diversity makes us uncomfortable’
