What will the workplace of the future mean for reward strategies?

home office

Need to know:

The Covid-19 (Coronavirus) pandemic has tipped flexible working into the mainstream for the first time and office environments may never be the same again.
We are likely to arrive at a middle ground, where office workers enjoy a combination of working from home and office days.
In the aftermath of the pandemic, wellbeing benefits will be important; meanwhile, online delivery of benefits will be key.

In his book The Circle, Dave Eggers imagined an all-too-believable office of the future. A young woman is excited to be offered a job at a prestigious technology firm. At first, she is awed by its campus, with amazing cafeteria, dorms for those who want to sleep over and all-night parties. But gradually she gets increasingly sucked in to a claustrophobic and morally dubious dystopia.

While Eggers paints an extreme picture, many of us will have encountered real-life offices boasting some pretty incredible benefits. From Canary Wharf skyscrapers with in-house GPs, gyms and dry cleaners to hipster Soho advertising agencies with in-house bars and yoga studios, many employers have attracted the best talent by kitting out their offices.

Writing from my armchair, the future of these benefits looks unclear. Will people ever return to offices en masse? If many are working from home and a new job just means a new laptop, how will employers differentiate themselves?

The death of the office

A great deal will hinge on whether, having had a taste of home working, office workers will ever return to their skyscrapers or Soho lofts.

Office workers will have had vastly different experiences of the pandemic. As Ian Bird, business development director at employee benefits adviser Secondsight, says: “Employers are going to have to assess whether people can continue to work from home. Younger employers who might be working from their coffee table might be ready to come back to the office. Others, with more comfortable setups, might like to come into the office once or twice a week.”

Much will also depend on employees' personalities. Some will be dying to get back to chats by the water cooler, while others will prefer to work more peacefully at home. Andrew Drake, client development director at Buck, who normally commutes from Bristol to London, says: “Humans are social animals. The idea we are all going to be stuck on Zoom or Teams forever, I just don’t think it’s true. But I do think the flexibility piece is massive. I don’t want to be dragging myself into the office five days a week.”

As Bird and Drake suggest, most consultants think that we are set to arrive at a middle ground. Many workers are likely to want the best of both worlds, spending some time in the office and some at home. In itself, that has implications for benefits.

For jobseekers, the option of working from home could be seen as a benefit in itself. Bird predicts: “I think employees might look for variety in the new role: I can work from home if I want to, or I can come into the office.”

People can then use the time and money they save by not commuting on doing something for themselves. For those with families, it might help with the morning rush, or give them a precious window of time for exercise.

Howard Finch, managing director of benefits consultancy Vested, says: “Rather than spending two hours travelling to an office every day, four times a week, I do a bit of running or am on the cycling machine. I have been able to build a bit more exercise into my working day without really impacting my hours of work.”

If employees are more likely to mix working from the office and home in future, it might mean headlines about the death of offices are overblown. However, the end of the expensive trophy office could well be nigh. “I think employers are seriously looking at how much workspace they can shed," says Bird. "Hot-desking could increase, with different teams coming into the office on different days of the week.”

Strategic thinking about benefits

The home-working trend could have a seismic impact on how employers recruit and incentivise their workers. The post-pandemic recession, plus the possibility of a no-deal Brexit, is going to result in a period of severe financial constraint, says Steve Herbert, head of benefits strategy at Howden Employee Benefits and Wellbeing. With employed people feeling a new sense of gratitude for their jobs, employers may feel less pressure to create competitive benefits packages.

“We now have a very different recruitment market," says Herbert. "In February/March, there was a lack of talent to be recruited. Now there is a huge amount of talent, that is going to completely change the dynamic.”

Tighter budgets will lead employers to focus on what really matters to people, says Drake. “People always talk about the cost of private medical insurance on the high street versus buying it as a corporate. If something is wrong with my daughter, say, and I can get her in for treatment really quickly as opposed to waiting on the NHS, the perceived value it might get me is worth a lot compared to the cost to the [organisation]. So, what value can we offer people which will be perceived as greater than the cost?”

Employers will be looking for bang for their buck, adds Finch. “There is still a real lack of understanding of how employee benefits help people with their personal finances. Do people really understand things like four-times life cover? When the employer is spending lots of money on things that impact positively on people’s personal finances, it isn’t always appreciated.”

Interacting with technology will help people to understand how these benefits directly impact their own personal finances in a way that has historically felt quite intangible, says Finch.

People could value different things post lockdown, says Drake. Employers have typically resisted people using their own devices to work remotely in the past. “Now, I wonder if the IT question might come up again and again,” he says.

If careful security measures are taken, employers could think about giving workers a working-from-home allowance, which could be spent on technology or creating a more comfortable working environment.

Experts agree that wellbeing will be a big focus as we come out of the pandemic. “Employers will be looking at their overall wellbeing support far more precisely going forward and thinking about what a good wellbeing programme looks like,” says Bird.

Given the close link between financial and mental health, financial wellbeing will be a big focus, with employers perhaps providing people with access to debt counsellors or online financial MOTs.

The pandemic has not just been financially stressful, but emotionally exhausting for many. Iain Thomson, director of incentive and recognition at Sodexo Engage, says: “Wellbeing seems to be a massive hot topic. We have seen a massive take-up of employee assistance programmes (EAPs). In an office, particularly from a management perspective, [employers] can see how people are and whether they are a little bit down. That becomes more difficult when they are on a video conference. Having those channels helps people to open up.”

Changes in delivery methods

Longer term, the sheer logistics of managing a flexible workforce will mean saying goodbye to lunchtime seminars and hello to online platforms and apps. “It has to be benefits that work equally well if [the employee is] onsite, at home or somewhere between the two," explains Herbert. "What that means is hard to say but it points towards digital solutions, a lot more self-service rather than things being provided.

“At the moment, I think far too much of what [benefits experts] do is word related. That’s fine if you have someone like me standing on my hind legs in front of a group so that they can ask. Less so if they are struggling through an app. There needs to be a much bigger shift in the industry towards making things a lot savvier, quicker and more engaging.”

Health and wellbeing-related benefits will remain important, adds Thomson, who thinks that the principles will stay the same, but the delivery mechanism will change. “I think it is about adapting the benefits you have into an online setting. For example, with Covid, a lot of trainers and gyms have moved to remote workouts. So, you still feel part of a community that’s exercising, and you still get the interaction. That subscription-based gym membership might work particularly well as a benefit.”

What of the free breakfast or fruit that some workers used to enjoy at their desks? “There are loads of delivery services [employers] could offer subscriptions to; healthy things that can arrive at [an employee's] door. Having those as options will be appealing to employees,” says Thomson.

The pandemic may have inadvertently set in motion a flexible-working revolution, but some principles remain the same. People will want to feel looked after and as though they belong to a community, wherever they are.