Remote work has been on the rise over the last 15 years, and the COVID-19 global pandemic has provided the work-from-home option with a further boost.
In March, at the outset of the pandemic in Canada, Canadian companies were directed to close their doors unless they were providing an essential service. This meant layoffs for a lot of companies who needed their employees in the workplace to do their work. But for many companies, it meant sending their employees home to do their work there.
When all you need is a computer and an Internet connection, you can work from anywhere. Many companies, along with their employees, kept doing business and working throughout the pandemic. And companies and employees alike have found that business can run just as smoothly away from the office as it can at the office.
Certainly, adjustments have to be made. Security protocols have to be implemented, employees have to be trained on data protection and companies need to ensure that their employees’ at-home systems have the proper security and firewalls to protect sensitive information; but overall, it can be business as usual.
Now that some regions have entered the reopening phase, many employers are instructing their employees to continue working from home where possible rather than implementing the changes that need to be put in place to have people enter a physical workspace on a daily basis.
The steady rise of remote work that saw a boom with the onset of the global pandemic may not see a bust as the economy reopens. Companies will have to rethink their new work model if they allow employees to permanently work from home, and that may include salary adjustments or restructured compensation as employees take on some of the costs of doing business at home.
At a Facebook townhall in late May, Mark Zuckerberg told his employees that if they plan to continue working remotely from locations where the cost of living and cost of labour is lower, they can expect their salaries to reflect that. What remains to be seen is how many employees will actually choose to move to an area with a lower cost of living. Many workers have already established themselves in areas where they prefer to live and raise their families. Working remotely on a permanent basis for a lot of workers simply means no longer commuting to the office, not picking up and moving across the country in search of a lower cost of living. However, in Canada employers cannot unilaterally downgrade an employee’s pay, unless regional payscales are part of the original employment contract.
According to a June study from the Angus Reid Institute, only one-third of Canadians working remotely expect to return to an office as often as they did pre-pandemic, and one in five employees say that they will continue to work primarily from home.
Companies can benefit from this shift. Back in 1994, before remote work was wide-spread and long before we faced a global pandemic that made remote work a vital component to the protection of our health, AT&T experimented with telecommuting for their employees and saw a 30 percent improvement in cash flow by eliminating and consolidating office space and related overhead costs.
Where a company sees a decline in expenses related to their workforce shifting to a work-from-home model, the company’s employees may see an increase in their expenses where they bear the costs of setting up a work-from-home office, higher heating/cooling and electricity bills, office equipment purchases and improved Internet service to meet security protocols required by their employer.
Employers may want to consider providing a stipend for employees to set up work-from-home offices.
Because of the home expenses discussed above, re-adjusting the employee’s pay downward may not be the right solution for the company in the long run.
We’ll have to wait and see whether remote work becomes the new normal or workers return to offices after the pandemic. The advantages and disadvantages of both will have to be weighed, but one thing is sure, the option to work from home from an employer and employee perspective is beneficial to both parties when facing events like the novel coronavirus global pandemic or other unpredictable circumstances, like severe storms, security threats, health events and more.
By Nancy Currie, First Reference Inc.
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