Is There a Promotion Penalization for Remote Workers?
Like it or loathe it, remote working in some form is here to stay. Millennials and younger workers are more hesitant to return to the office than older generations, although all age groups have demonstrated a preference for hybrid working models rather than a full return to the office.
However, there has been concern voiced from various parties about remote workers being left out of promotions in hybrid working environments. The UK Chancellor Rishi Sunak emphasized the importance for young people specifically to be in a physical office in order to create strong relationships with mentors. Among the many rebuttals from younger workers was a woman with disabilities who noted she was less limited in the positions available to her now that working from home was standard.
Apart from anecdotal evidence, there is some literature to suggest those opting to work from home may be at a disadvantage compared to their colleagues in-office. A 2015 study of a Chinese firm found that employees who worked from home reported to be happier and more satisfied with their jobs, with attrition amongst that group dropping by 50% compared to the control, while performance improved by 13%. Despite the obvious benefits to the company from these employees (approximately $2K/employee/year on cost savings and total factor productivity improvement of 20-30%), those working from home had reduced rates of promotion of 50%, controlled for performance. In fact, after the study, some employees went back to the office specifically out of concern for being left out of advancement.
Employees themselves don't appear to feel as though they're missing out on important in-person face-time: In a large global survey done earlier this year, fully remote knowledge workers felt better about their level of access to relevant people, files and resources at work than both hybrid workers and those fully in-office. However, the same survey reported anxiety around being seen as "second class" by remaining remote workers in hybrid environments where those back in the office were "more senior, male and white". This is a likely risk—among American knowledge workers, white men were the most enthusiastic about returning full time to the office, while black men were the least. Hybrid workplaces therefore must be designed intentionally to quell these fears and avoid the "flexibility stigma", such as the career penalization working mothers face for preferring flexible working hours. Putting in place tools to engage workers in digital environments is a critical part of accomplishing this.
Employees have demonstrated a willingness to change companies and careers during the pandemic. The flexibility to work from home has become a valuable tool for attracting—and retaining—employees: Surveys from the US and UK indicate that workers would expect a 6-8% pay rise if they were unable to work from home at least two days a week. Employee attrition is expensive, and organizations with high rates of turnover may be viewed with suspicion by candidates. Alleviating stress and uncertainty for employees by communicating performance expectations and metrics across consistent channels for all workers is essential to avoid this. Getting digital corporate culture right is mission critical for both organizations moving to a hybrid model and those whose entire workforce is remote.
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