The Great Resistance: Return-to-Office Enforcement Collapses
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Suddenly, businesses find themselves embroiled in a new challenge known as the Great Resistance. At most companies, return-to-office initiatives have disintegrated into colossal failures because many employees are declining to come back to their old workplaces.
How can we tell?
We understand that trend because of results from an ongoing, monthly academic survey of 5,000 full-time workers across the United States. Called the Survey of Working Arrangements and Attitudes (SWAA), the study’s principal investigators are led by Dr. Nicholas Bloom, an economics professor with Stanford’s Department of Economics, Institute for Economic Policy Research, and Graduate School of Business. His team includes Dr. Steven Davis at the University of Chicago’s Booth School of Business, and Dr. Jose Maria Barrero, a finance professor with the ITAM Business School at the Instituto Tecnológico Autónomo de México in Mexico City.
The Challenges of Enforcing Return-to-Office Policies
Consider these surprising facts uncovered by the professors during July 2022 alone:
At businesses that have purportedly instituted a full, five days per week return-to-office (RTO) policy, the employee compliance rate is astonishingly low—it’s less than half of America’s workforce. Only 48 percent of workers show up at their company’s offices for all five days. Conversely, that estimate means a majority of 52 percent are actively defying such mandates.
At firms that have provided their personnel with a work-from-home option, about 20 percent of the employees still do not show up at their workplace during the minimum number of days the company requests.
Compliance at companies who request four or fewer days at their offices each week ostensibly seems better, at about 80 percent of employees. However, consider Dr. Bloom’s analysis of what that estimate really implies: each day, on average, within every typical seven- or eight-person team that’s supposed to attend in-person meetings at the workplace in-person, at least one or two of those teammates will remain working from home.
These findings mean that working within a company’s place of business is no longer the connected experience it might have amounted to for millions of workers during the postwar era since World War II. In fact, Zoom video meetings are now a widespread fact of life every day within corporate America—even within company facilities.
Why? That’s because only through using online platforms like Zoom can meetings include the contributions of all team members. And this fact begs the question of why employees should invest the time and expenses required to commute to their companies’ facilities. Why bother, given that interacting with colleagues working from home will require all the teammates who showed up at the office to spend their day talking through their computers anyway?
One might suppose that managers might be cracking down on all this subversion across America. Instead, one would be mistaken. The professors’ data shows that enforcement efforts at most companies have essentially collapsed.
The most common response to this noncompliance by 43 percent of managers is to do absolutely nothing. These supervisors routinely ignore their subordinates who refuse to come in on the requested schedule. By contrast, termination eventually results in only 6 percent of cases. In another 40 percent, the penalties are relatively minor, ranging from verbal reprimands and less satisfactory evaluations to a consequence that the professors found many employees would accept in exchange anyway: pay reductions.
About 60 percent of the survey respondents reported that they’d be more likely to consider an offer for a new job so long as it enabled them to work away from the office four or five days each week. The respondents also said that they considered working from home so important that they valued it equivalent to an 8 percent pay raise.
The professors then asked respondents currently working away from the office one day per week what they’d plan to do if their employer made office attendance 100 percent mandatory, five days a week—just like it was still 2019.
Forty-two percent said that they would leave. About 36 percent reported that they’d comply temporarily but start looking for a new job that allowed them to work from home. Six percent even said they’d quit on the spot, as we discuss below.
Reasons for the Inaction of Managers
Managers supposedly required to enforce return-to-office policies find themselves caught between a rock and a hard place. Here’s their dilemma: If the managers don’t attach negative consequences to insufficient attendance, the company’s leadership appears weak. But on the other hand, the past two years of record company profits and growth would never have happened if most workers weren’t getting their jobs done. That amazing performance record makes it difficult for supervisors to justify punishments for hardworking employees, merely because they complete their assignments away from their companies’ workplaces.
One reason why companies refuse to enforce these policies is that most of their managers don’t support the edicts. In testimony provided to the researchers, supervisors argue they can still perform effectively even if they come into the office only two or three days during the week, and while they also turn blind eyes to their employees who work extra unscheduled days at home.
A second reason for this non-enforcement is that working from home makes finding a new job vastly easier. “Searching and interviewing while working at the office can be hard, with several hours away under some dubious excuse,” says Dr. Bloom.
Instead, working at home simplifies and streamlines job searching so much that managers told the researchers they fear a torrent of swift resignations if they were to crack down on their employees who work excessive days at home. That fear is certainly justified. Los Angeles employment attorney Ann Marie Zaletel with the law firm Seyfarth Shaw LLP told Business Insider that “with the tight labor market, employers are not in a position to lose their top talent. They’re not in a position to fire 50 percent of their workforce.”
What is an “Impulse Quit?”
In fact, the professors appear to have coined a phrase, “impulse quits,” to describe a new phenomenon where employees spontaneously and unexpectedly resign:
Indeed, some managers have raised fears of “impulse quits.” Employees who get frustrated with a bad performance review or a dressing-down from their managers rapidly search for a job, interview online, and accept a new job within a couple of days.
This is happening even within the day, particularly in hot markets like the tech industry. It’s not unheard of for someone to search the help wanted [advertisements] in the morning, take an interview in the afternoon, and accept an offer by the close of business.
It’s entirely possible that some of these impulse quits might actually be high-profile technical executives at blue-chip market leaders who fit the profile the professors describe. And losing their scarce and specialized expertise may put the future competitiveness of their former companies at risk.
For example, in May 2022, The Verge’s Zoë Schiffer reported that Apple’s director of machine learning, Dr. Ian Goodfellow, suddenly left the company after four years because of the firm’s return-to-office policy: “I believe strongly that more flexibility would have been the best policy for my team” he told his staff in an email message, saying Apple’s policy change accounted for part of the reason for his decision to leave the company.
An artificial intelligence expert, Dr. Goodfellow had earned a PhD from the University of Montreal in 2014. Before taking his job at Apple, the researcher had worked for Google, and he had also worked for Elon Musk at the machine learning developer OpenAI. CNBC reported that during only 13 months with Musk’s firm, Dr. Goodfellow had earned a staggering $800,000.
Today Dr. Goodfellow works as a research scientist for DeepMind, an artificial intelligence developer headquartered in London. Prominently displayed at the top of its LinkedIn profile, DeepMind describes itself as a “hybrid workplace” with flexible time on-site.
Requiring that all employees return to their offices in Cupertino for at least three days a week, and advocated by CEO Tim Cook, Apple’s new return-to-office policy has endured fierce criticism from a faction of employees. A letter to the firm’s senior executives
obtained by MacRumors contains this language:
Many of us feel we have to choose between either a combination of our families, our well-being, and being empowered to do our best work, or being a part of Apple. This is a decision none of us take lightly, and a decision many would prefer not to have to make.
Other tech firms like Twitter and Airbnb may have instead introduced new work-from-anywhere policies to distance themselves from the rigid stance taken by Apple, and to help them attract talent defecting from competing employers. For example, kicking off a statement released on their website in late April 2022 entitled “Airbnb’s Design to Live and Work Anywhere,”
the San Francisco-based company posted this language:
Since the COVID-19 pandemic began, a new world of travel has emerged. Millions of people are now more flexible about where they live and work. In response to this trend of newfound flexibility, Airbnb today announced our approach to allow employees to live and work anywhere, and how we will partner with destinations to help them attract remote workers.
Threatened by a Full-Blown Exodus
With this statement, Airbnb became the latest billion-dollar company to join the ranks of work-from-anywhere employers like GitLab, Zapier, and Automattic. Meanwhile, defections have forced hundreds of other firms throughout the technology and financial services industries to dramatically scale back their return-to-office plans.
In early 2022, we witnessed plenty of bravado from Goldman Sachs and JPMorgan throughout the legacy business press about how those firms would insist upon compliance with their 40-hour return-to-office plans. But after Dr. Bloom learned of conversations throughout the ranks of those two firms where professionals had threatened to quit, and after Citigroup, HSBC and UBS surprised observers by announcing their own hybrid schedules, Goldman and JPM suddenly went silent about their RTO plans.
Moreover, Business Insider had reported back in April that the sole big-tech firm that tried to compel full-time office work, Amazon, didn’t stand a chance when poachers Oracle and Facebook pounced on the Seattle firm’s disgruntled employees as soon as it had announced its 40-hour return-to-office mandate. To stop the bleeding from all the resignations, Amazon drastically rolled back those plans and gave employees two more days every week at home.
After observing the brain drain at Amazon, it didn’t take long for Google, Uber, and LinkedIn to scale their RTO policies way back. Facebook then expanded remote-work eligibility to all workers, even junior, early-career employees. Insider’s senior workplace trends correspondent Aki Ito eloquently summed up this widespread collapse in return-to-office enforcement this way:
Almost overnight, employees began quitting their jobs in record numbers. Emboldened by the red-hot job market, Americans felt free to shop for flexible work arrangements that better suited their needs. Threatened by a full-blown exodus, executives suddenly realized they could no longer afford to ignore the uproar over working from home. . .It was a remarkable sight: some of the world’s largest and most powerful corporations being forced to bow to their employees’ work preferences.
Overall, U.S. companies may not want the professionals they employ to enjoy the flexibility and freedom of working away from the office. Most never have. Nevertheless, the severe constraints those employers now face have resulted in extraordinarily limited options and bleak alternatives when it comes to limiting remote work. Enforcement of return-to-office policies has largely collapsed across America, and there’s no good reason to expect this situation will change anytime soon.