- Return-to-office (RTO) mandate criticism. Research indicates that strict return-to-office mandates decrease employee satisfaction rather than improve productivity or profits.
- Mixing RTO policies and performance reviews. Particularly when in-office days are inconsistently enforced, tying performance reviews to RTO can reduce employees' trust in companies.
- Flexible policies may be best. Building a company-specific policy around in-office and remote work — taking employee needs and experience into account — may boost employee satisfaction and improve company profits long-term through greater talent retention.
Some employers rushing to implement return-to-office (RTO) mandates may find the move backfiring on them, particularly in the case of inconsistently enforced policies being tied to performance reviews.
A recent University of Pittsburgh study adds weight to current research about the shortcomings of swiftly implemented or overly strict RTO mandates and policies that lack nuance.
The study — co-authored by Mark Ma, associate professor of business administration at the University of Pittsburgh, and Yuye Ding, PhD student at the university's Katz Graduate School of Business — suggests that some RTO mandates reflect a company's lack of trust in employees, or an attempt to blame poor company performance or a reduction in stock prices on remote workers' lack of productivity. The study also pointed to evidence that RTO mandates reduce employee satisfaction but do not necessarily improve employee performance or company profits.
“If employees who work from home, and are efficient and productive at home, perceive that their managers don't trust them, their trust in management will drop as well,” Ma said. “Several employees have told me that when people are asked back to the office, they just do the minimum so they don't get fired.”
Negative Impact of RTO Mandates
According to a 2023 WTW survey, 55% of 720 organizations said that they expect more than half of their employees to be remote or hybrid within the next three years. RTO mandates may feel like a “180 shift” for employees, particularly those who took a job because of the flexibility it offered, said Rachael McCann Jones, global DEI leader at WTW.
“If employee well-being and diversity, equity and inclusion are important to an organization, a mandate may signal to employees that [the company is] not committed [to them], as flexible, hybrid and remote work are a game-changer for work-life balance, caregivers and disabled employees,” McCann Jones said.
Recent research from Gartner indicates that women, millennials and high-performing employees are most likely to leave their job if faced with strict RTO mandates. Women said flexible work allows them to manage at-home needs and reduces their encounters with biases and microaggressions; millennials are most likely to be caregivers and benefit from additional flexibility; and high-performing employees said RTO mandates imply a lack of trust from leaders. Almost half of the nearly 3,500 employees surveyed by Gartner said their company's RTO mandates prioritize leaders' desires rather than employees' needs.
The University of Pittsburgh study found that employees' job satisfaction, work-life balance, and views of management and company culture all decreased after RTO policies were implemented.
“The long-term outcome will likely be that businesses that offer greater flexibility will attract the best talent,” Ma said. “As a result, they will outperform those businesses with less flexibility.”
Tying RTO to Performance Reviews
Many RTO policies are inconsistently enforced or tracked. Ma noted that some of the employees he interviewed in his study went to the office in the morning so that the swipe of their badge was recorded, then left midday to finish working at home. Their managers did the same.
If companies tie RTO policies to performance reviews, particularly with inconsistent managerial oversight of the policies, employees may feel they're being punished for the initially offered perk of flexible work.
"Tying RTO compliance to performance reviews without clear and consistent implementation can lead to perceptions of unfairness,” WTW’s McCann Jones said.
Other Options for Employers
Given the fact that the majority of employees globally have indicated they would exchange pay for greater quality of life, finding ways to offer flexibility is a smart total rewards move, Ma said.
“Financially, compared to cash or stock rewards, greater flexibility is the most cost-efficient way for companies to motivate employees,” he said.
Noting that prior research has probed consequences of remote work, Ma pointed out that limited attention is paid to determinants of workplace flexibility taken together. The study highlighted other factors that come into play, such as firm-level attributes, CEO characteristics and policy-making roles, industry types and local transportation options — all of which affect RTO mandates and the level of flexibility that employers may believe they can accommodate.
Given the negative effect the study found of RTO mandates on employee satisfaction, however, any policy or strategy adjustment to working arrangements should involve discovering employees’ needs and preferences, McCann Jones said. Gather their insight directly on what would help improve their productivity.
“These insights can be critical in understanding the current state and finding opportunities to both meet business goals and potentially not implement a mandate,” she said.
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