Why Recruiters And Experts Think Return To Office Mandates Are Actually Layoffs In Disguise
There's very little data supporting the notion that in-office work is better than working from home. So why are so many companies insisting on it?
wutzkoh, a40757, Eli Sommer / Canva The wave of return-to-office mandates in recent months has never made all that much sense. While the data that employees prefer working from home is pretty much conclusive, the data showing that in-office work is more productive than at home is sparse and dubious at best.
So why the rush to force everyone back into their cubicles? It turns out there might be far more behind it than any of us realize.
Return-to-office mandates are actually layoffs in disguise, according to many experts and recruiters.
Here's what we do know for certain about return-to-office, or RTO, mandates: They are wildly, almost uniquely unpopular with employees.
A recent survey by FlexJobs found that being able to work remotely was the most important criterion for a job for 63% of workers, even if it meant taking a pay cut. Accordingly, companies that are instituting RTO mandates have been found to be growing much more slowly than those that aren't.
Meanwhile, after decades of studies conclusively showing work-from-home actually makes people more productive and saves companies tons of money, claims that working in-office is actually the more productive scheme have proliferated lately.
This is despite the fact that the data supporting these claims is sparse at best, mostly focusing on a single study of data entry workers in India, hardly an apples-to-apples comparison for the majority of the American workforce. So what's actually going on here?
Some experts and HR professionals think return-to-office mandates are elaborate strategies to ensure employees leave without the legal and financial repercussions of formal layoffs.
According to a survey by Resume Builder, a staggering 90% of companies plan to institute an RTO mandate by the end of 2024. That is a frankly bonkers thing to do given that employees hate them, they hobble companies' growth, they cost companies tons of overhead to maintain brick-and-mortar offices, and there's hardly any data to support they're even worth it.
Of course one of the major factors is that many corporations, and the even bigger conglomerates and private equity firms that own nearly all the companies we all work for, are all heavily invested in the commercial real estate market.
But as several experts and HR professionals have pointed out, RTO mandates are also a clever way to get rid of tons of employees without any blowback. Because employees hate them so much, they end up quitting.
Morgan, a professional resume writer and HR professional, thinks this is the only explanation that actually makes sense. "Layoffs are actually a legal nightmare," she explained in a recent video.
To illustrate this Morgan referenced the infamous recent case of struggling gay dating app Grindr losing 45% of its staff in one go when employees balked at the company's new RTO mandate. "They lose half their staff without having to jump through all those legal hoops."
Layoffs are also often very expensive to companies due to the severance packages that are sometimes required to be paid, as well as because of the way layoffs impact the rate at which a company is taxed to fund state unemployment benefits. Neither of those are factors when employees voluntarily quit.
And Grindr isn't alone. Everyone from Meta and Microsoft to AT&T and Citi have been accused of running similar RTO-as-layoffs schemes as an easy way to circumvent all legal and financial rigmarole, while also avoiding the bad PR layoffs bring to a company by calling its financial stability into question.
As Morgan put it, "It just looks better to stakeholders to not call it what it is, which is a layoff."
Experts say some companies are also using RTO mandates to gauge employee loyalty and avoid a dip in morale, a strategy many think will backfire.
Layoffs come with a dip in morale. It's just part of the game when you shed a massive number of workers all at one time.
Experts CNBC spoke with about the matter said avoiding this problem is another reason for using return-to-office as a stealth layoff. They say companies are also using RTO mandates as a sort of loyalty test because only the most committed and dedicated employees will stick around.
But those experts and many other business leaders say those strategies are likely to backfire in a major way, a prediction Morgan agreed with.
"When you think about the people who stay and now have to pick up the work of everyone who left, I can't say that that's good for morale either," Morgan said in her video. "And as for those who are so committed they stayed despite the RTO mandate? Are they committed or do they just not have any other options?" Morgan posited.
Taken together, it's hard not to feel like all the business leaders issuing hardline RTO mandates aren't fundamentally misreading the prevailing mood in the professional world at the moment.
As real estate mogul and "Shark Tank" star Barbara Corcoran recently put it to Yahoo Finance, "The fact of the matter is [employers] are not in charge anymore, the employees are."
And the situation left Morgan issuing a warning to business leaders. "All these companies daring employees to quit, I don't think you're going to be very happy with the results."
John Sundholm is a news and entertainment writer who covers pop culture, social justice, and human interest topics.