The true costs of flexible working


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Staff are usually keen to work flexibly, but what are the tangible and intangible costs incurred by employers?

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The true costs of flexible working

  1. 1. T echnology has unlocked all manner of novel ways to work, from working at home to hot-desking at the office, from sitting in a café using a laptop to answering emails on the train. Employees are generally keen to take advantage of these new working styles, as they allow them to work when they want to and manage their work-life balance more effectively. There are ample benefits for employers too: flexible working can engender a happier, more engaged workforce, and people who are prepared to work when required, not just when they happen to be in the office. There are also savings to be made, as employees voluntarily use their own devices and communications services to complete their work. But neither employers nor their staff should pursue flexible working without being mindful of the hidden costs – both tangible and intangible – that are passed on to the employee. Paying from home The equipment required to perform typical office work can now be found in most UK homes. According to the 2013 Communications Market Report by Ofcom, the independent regulator and competition authority for the UK communications industries, 79% of households have at least one desktop or laptop PC, and 80% are connected to the Internet. With the necessary equipment already in place, employees are rarely concerned about the initial cost when they are given the opportunity to work from home. “For the employee it’s an acceptable trade-off,” explains CIO-turned- leadership consultant Ian Cox. “They get the flexibility of being able to work where they want, which also removes the time, cost and hassle of commuting.” However, other home expenses can become a bone of contention, especially when flexible working is thrust upon employees as part of a cost-cutting drive, according to Dr Alexandra Beauregard, assistant professor of employment relations at the London School of Economics. At one organisation which Dr Beauregard has studied in detail, home- working staff found they were spending significantly more on heating and electricity than when they worked in the office, by virtue of being at home for more hours in the day. “There have been complaints from individuals working from home, because they weren’t being compensated for the extra heating and electricity costs,” she explains. “Organisations are going to have to put more thought into compensating individuals for these expenses.” It is not obvious how exactly companies should do that – how much of the heating bill should they cover? But there are plenty of precedents. “If employees use their own cars to drive to a meeting, there are established rates for reimbursing them,” Dr Beauregard observes. “Going forward, paying household costs will become more expected.” Intangible costs There is more to flexible working than simply working from home, and companies that support alternative approaches must be aware of the intangible costs that employees incur. For example, “hot-desking” – where employees do not have a fixed desk and computer but use shared facilities when required – is an increasingly popular strategy among employers, often in combination with some home working, as it reduces the number of desks and computers they have to provide. However, according to Dr Beauregard, hot-desking policies can place a psychological burden on staff. “Research is coming out which suggests that not having a regular workspace can be detrimental to staff and not optimal in terms of productivity,” she explains. Work may change every day, but having a consistent space, surrounded by the same people, gives employees a sense of certainty in the workplace. Furthermore, having to compete with fellow employees to get the best desk or the best computer every morning could be an unnecessary stressor. The hidden costs of flexible working Staff are usually keen to work flexibly, but employers should be mindful of the tangible and intangible costs they incur as a result Written by The Economist Intelligence Unit Sponsored by:
  2. 2. “People don’t deal with uncertainty very well, and there are some things we want to be able to rely on,” she explains. “Hot-desking adds another element of uncertainty to the working day.” She adds, though, that there are ways to manage hot-desking policies to make them more predictable, such as the option to book desks in advance. A suitable environment Pervasive wireless networking and the growing sophistication of mobile devices mean that flexible workers can set up shop anywhere. Some people who like to be surrounded by human activity may choose to work in a nearby café, using their laptop and a WiFi connection. A potential issue with this, Dr Beauregard says, is that cafés are not designed to be working environments. “Cafés are rarely ergonomically correctintermsofseatingandposture,”sheexplains.“Ifyouaresitting there for an hour or two, it’s fine, but if you are there, hunched over your laptop for several hours, it can be damaging in the long term.” If an employee has requested the right to work flexibly, then their posture is their own responsibility – in a café, at home, or anywhere else. But if their organisation has mandated flexible working, then it may be obliged to check that employees are working in safe conditions, just as it would for office-based staff. Another potential hazard of flexible working – and one that is contrary to the prevailing stereotype – is the risk of employees working too much. “One of the most robust and consistent findings about flexible workersisthattheytendtoworklongerhours,”explainsDrBeauregard. There are a number of possible reasons for this. First, when the office is in the home, it can be harder to disconnect. “When you leave the office, you’ve made a transition out of work. But at home, that transition is just walking down the hall, and it’s easy to walk back down the hall and return an email, or pick up your voicemail. It’s difficult for some people to switch off.” Another reason is that employees are so grateful to be able to work flexibly—andareusuallyawareofthestereotypethattheywillsitintheir pyjamas watching TV instead of working—that they overcompensate. Again, it is not the employers’ responsibility to ensure that their staff conform to a particular work-life balance, Dr Beauregard says. “But it is their responsibility to make sure they are not placing undue pressure on employees to work longer hours.” “Employees want flexible working in order to improve their work-life balance,” she explains. “But in some cases, they may be working harder for longer hours because they feel the need to pay the company back.” For now, flexible working initiatives are likely to be met with nothing but enthusiasm from employees. But as with any major changes, there are cons as well as pros, and forward-thinking organisations will pre-empt the drawbacks before they become significant management issues.