In this update, we’re looking at the hot topic of returning to the office post-pandemic.

Q: What’s the direction of travel on working from home in financial services?

While many industries have embraced hybrid working, financial services has generally been less enthusiastic about the idea of staff continuing to spend a significant proportion of their working time at home. Goldman Sachs boss David Solomon hit the headlines for calling the working from home shift “an aberration”. UK-based staff of the Bank of America were encouraged to return to the office once they’d received their first vaccination and the Bank told everyone they were expected back in the office by September.

That’s not to say that there’s no appetite for home working among staff. A survey by Accenture revealed that 24% of the UK’s financial services workers want to work from home full-time, and 69% want to work two days or fewer in the office. A mere 8% of respondents said they wanted to work from the office five days per week, so there’s a clear mismatch between firms’ views on flexibility and the wishes of their staff. Having conducted a similar survey in-house, the Bank of England has implemented a trial period whereby staff must only come into the office once a week for ‘team days’.

Q: Can we force staff to come back into the office full-time?

From a legal perspective, in most cases you can require staff to work from the office now that COVID-19 restrictions have eased. Assuming that their place of work as specified in their employment contract is the office then that is something that you can enforce.

There are, however, some important caveats to that. Case law has upheld the existence of a ‘childcare penalty’ in that women are more likely than men to bear caring responsibilities for dependents. Therefore, a practice of requiring staff to work exclusively from the office is likely to be indirectly discriminatory on grounds of sex unless the employer can objectively justify that requirement (which is where having a business rationale for the requirement will be crucial). Staff with disabilities may have difficulty commuting to and from the office every day – allowing them to work from home a certain number of days each week may be a reasonable adjustment.

It will also be important to be sensitive to the aftermath of the pandemic. It is likely that some people are reluctant to take public transport in and out of the City every day and mingle in the office for fear of catching the virus. Do what you can to make your premises secure and reassure your staff that their health and safety is important to you. If you still need them to come into the office, allowing them to commute outside of peak times may help with the concerns around transport.

Q: What if we receive a flexible working request?

Under current law, an employer must consider a flexible working request made by any employee with 26 weeks’ continuous service. As long as certain formalities are met, the employer will have to follow the statutory process set out in section 80G of the Employment Rights Act 1996, which includes only rejecting the request based on one or more of the eight business reasons listed in that section.

Unless it is clear that the requested working pattern is not feasible, it will normally be best practice to allow the employee to give it a try during a specified trial period. 

Note that the government is currently consulting to remove the 26 week eligibility threshold so that the ability to make a flexible working request becomes a ‘day one’ right.

Q: Should we maintain the pay of full-time home workers?

Firms who intend to allow staff to work from home most or all of the time may wonder whether they really need to pay them as much as they currently do. It is no secret that London wages are generally higher than the rest of the UK to account for the higher cost of living, but if there’s no (or an infrequent) need to come into the office, there’s no need to incur the costs of living in London. Google in the US is considering reducing the pay of staff who permanently work from home, and location-dependent salary is not unusual in the tech sector.

As yet, UK employers have been reluctant to make similar announcements. A CIPD survey showed that of those employers who vary pay geographically (e.g. by paying a ‘London weighting’), only 7% have changed pay to reflect homeworking so far. A further 16% are keeping the issue under review, which suggests that most employers are not considering making pay cuts. The likely reason for this is that (unsurprisingly) wholesale pay cuts do not usually go down well with staff.

However, from a legal standpoint, there’s nothing to prevent an employer implementing a pay cut when it agrees to vary a formerly office-based worker’s contract to allow them to permanently work from home. The employer would advise the employee that the consequence of amending the contract would be a corresponding pay cut, and it is up to the employee to take that reduction or not. Given the amount of money an employer could save in doing so, it is worth considering. The only caveat, as above, is to consider whether there is any potentially discriminatory aspect on sex or disability grounds in any given situation.