Most employers need to move out of the dark ages when it comes to their attitude towards remote workers and telecommuters. There are many huge benefits for companies and employers that implement flexible home working environments.
Our findings will impress you.
Telecommuting unlocks 26 critical benefits for employers, which we break into five core areas:
- Cost Reduction
- Improved Productivity
- Improved Talent & Workforce Management
- Employee Satisfaction & Retention
- The Marketability Of The Remote Work Policy
Fixed & Variable Cost Reduction Benefits For Employers
1. Lower Employee Salary Costs
Believe it or not, those people offered a flexible working contract to see immediate value and benefits of up to 20% of their taxable income. The cost of a car, road tax, and gasoline is a high cost to any commuter.
Add to that a typical 2 hours per day is saved on the commute, which equates to 10 hours per week. Considering we are awake for 112 hours per week and spend 40 hours of those 112 hours at work, a saving of 10 hours per week is a reduction of 25% of our effort of working and a 9% improvement in the time we have in our waking life.
A survey of 1500 IT professionals revealed that 37% would take a paycut of 10% if they could work full-time remotely 1
These benefits are enormous. Any prospective employee would be willing to consider a 10% lower salary on a job offer for the opportunity to work remotely and save nearly 10% of their waking life and additionally reduce overhead transportation costs.
2. Lower Office Costs
The fact is office space costs a lot of money. Any large business will see in their balance sheet that the cost of property, plant, and equipment will be anywhere from 15 to 25% of their asset cost. Office space maintenance, cleaning, security, reception, and canteens are a burden to employers.
A key benefit of moving more significant portions of the workforce is the ability to downsize office space and sub-let parts of the office buildings you own to other companies reducing your overall burden.
Even implementing a flexible work policy for employees who need to use office locations for customer and supplier meetings can reduce the need for a fixed desk. The rise of the mobile desk means a higher utilization of office space assets, which reduces costs overall.
Using a clever mix of full-time remote working for staff that does not need to be physically in the office and having hot desks for those that need an office some of the time can reduce overall office overheads by 30%.
3. Reduced Energy Costs
Smaller offices, fewer printers and laptops, less lighting, lower heating and cooling costs amount to additional savings for employers. As you will see later in this article, remote workers see telecommuting as a benefit; therefore, they will tend to cover the home office expenses themselves without requiring subsidies from employers. In many countries, home office expenses are also tax-deductible for employees.
4. Lower Costs Of Parking Facilities
Often overlooked, the substantial parking facilities required for a large workforce are a substantial burden for employers. Each employee’s working space is equivalent to the square footage of their car, so companies need to plan accordingly.
Fast-growing businesses often have huge issues with parking facilities for their employees, and needing to source more short-term parking can be a costly affair.
5. Lower Transportation Costs
Some companies subsidize transportation costs through company cars, discounted auto leasing, or even public transport discounts. If your employee works from home, you can deduct these burdens from the balance sheet. For a large workforce, these costs can be substantial.
Improved Productivity & Effectiveness
6. Proven Improved Productivity
Many large corporations have reported that teleworking or remote working has increased employees’ productivity by up to 40%, according to research conducted by globalworkplaceanalytics.com, who data mined over 4000 telecommuting academic research papers.1 The following points in this section cover the contributing factors to this productivity improvement.
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7. Fewer Distractions
Being part of the office means socializing, coffee breaks, team lunches, and water-cooler moments. While these things are part of the human social experience, they actually add little to the business of productivity.
Most people go for their social breaks with the same people, so it is not a matter of arguing that being in the same office adds a level of networking that increases employees’ ability to get things done across teams or organizations; this is simply not the case.
Remote workers simply do not have these distractions; therefore, more of their energy is put into actual work and actual beneficial relationship building to achieve a given task or goal.
[Related Article: The Unstoppable Trends in Remote Working]
8. Improved Networking
As someone who has worked remotely for Silicon Valley giants for the past 18 years, 13 years of which have been a mix of remote work and traveling to offices worldwide, I can share how networking in geographically distributed remote teams works.
If you need to find a contact who can help you achieve a task or build a cross-organizational team with people with the right skill set, you need to reach out to the right person.
This is where the organization chart comes in. Do you need someone responsible for real estate, datacenter, finance, or human resources? You simply reach out to the organization’s leader via instant messaging, email, or a quick phone call, and they will give you a name. If you are stuck for where to go, you ask your boss, and chances are they will know the organizational structure better than you. Over time your network will grow, and you will know who to call to get a result. Deep personal relationships are not required.
Office-based workers do not operate like this; they are confined to the walls they are within, they have not learned the ability to pick up the phone and talk to strangers in other countries to get things done.
9. Remote Workers Work More Hours For Free
I know this from experience, but research at Sun Microsystems Inc. 2 proves the point. Remote workers tend to give back to the company close to 60% of the commute time they saved. AT&T also reported that their telecommuters worked on average 5 hours more per week than their office-based counterparts. 3
Think about it, the people you trust to work unsupervised remotely are the type of workers that have proven they can do the job and deliver on their goals wherever they work. A motivated employee will get up in the morning, but will they wait until they would normally arrive at work after the commute to start work? No, they will start work immediately; they want to get ahead of the game. Do not mistake people working from home with a lack of ambition; there is zero correlation there.
10. Service & Operating Model Improvements
I have had the privilege of building from scratch many teams according to the needs of the business, and I have to say building a team of flexible remote workers is quicker and ends up being extremely effective at achieving the goals the team has before it.
Consider the example of a global organizational transformation team. You are tasked with building a team to transform the work of 8,000 people who are spread across 12 large global sites, and you need to improve eight core processes that run in each of the sites.
What do you do?
Build a local team
Do you build a team where you are located so you can collaborate locally and build a transformation plan? The benefit of this model would be that you all have face-to-face time for most of the working day. The downside is that you are limited to the resources at your location. And then, you need to send your team across the globe to try to implement the plan, which means cost, time, and local cultural implementation issues.
Build A Global Team
Alternatively, as I have done, you seek to build a team of high performers from each of those 12 sites. You can balance the team’s skillset across locations and pick the best people across the globe to achieve the goal.
The benefits are that you have the best people in a location and have the local hands and eyes on the ground in those locations.
The slight downside is that you have to work remotely with your team. But in the era of great collaboration technology we have today, this is not a problem. Arrange a few global “face-to-face planning sessions” with some team-building events mixed with a few drinks, and you will have a great team. (Shout out to my Hewlett Packard Enterprise Next Generation Delivery Model Team… you were the best team ever).
You also benefit from having a core team member in every location who can lead the local implementation and provide feedback on the cultural differences in that location.
11. Global Service Coverage
The benefits of a globally distributed remote team extend even further.
For example, you need to establish a team for a project that requires someone to be available across time zones to troubleshoot issues or solve customer problems.
Do you build that team in one location and have a 24/7 shift pattern where people rotate through an unsociable nightshift and then move to day shifts one week later?
Or do you build a “follow the sun team” where everyone gets to work their local hours and still have time for family? Building teams that meet the exacting business and process needs is the core advantage of a flexible workforce.
12. Increased Employee Work Presence
Do you feel that you need to be in all places at all times? When adopting a true approach to virtual team working, you can. Do you need to attend a manager’s staff meeting in India to pitch your new project? You are there. Do you need to sell the idea of expanding your product portfolio in Costa Rica to the local management team? You are there. Your employees can work across the globe without having to leave their homes.
Adopting flexible working is the closest to omnipotent we as humans can get
I have presented at team meetings, all-employee meetings, and all manager meetings in multiple contents within the same single working day without leaving my home office.
That is what is called an increased work presence.
13. Lower Staff Turnover/Attrition
We will discuss in the next section that flexible working improves employee satisfaction and is seen as a benefit by employees. The side effect of satisfied employees means you will naturally have lower attrition and staff turnover.
Approximately 46% of firms with a telework policy report that it directly impacts the reduction of attrition in the workplace. The costs involved in attrition are significant.
The lost productivity involved in onboarding a new staff member can amount to up to 30% of that person’s salary in their first year. You can expect a new staff member to be fully onboarded and operating at a good level of productivity after three months. Adding to the costs is the effort of other team members and the manager to train and shadow the new hire; this means costs escalate to over 30%. Never mind the paperwork, new contract, badge, security, and establishing of pension and insurances.4
The flexibility of the workplace is also key, 66% of employees would change jobs to ease the commute to work and 14% 5 of Americans change job every year to shorten the commute.
Flexible working significantly reduces if not fully removes the commute.
14. Fewer Employee Sick Days
According to research 6 fully 78% of employees who call in sick are not really sick. The biggest factor influencing sick days are actually family issues, personal issues, and stress.
So it is not a large leap to believe that research by the American Management Association (AMA) reveals that teleworking programs contribute a 63% reduction in unscheduled absences. Research also confirms that even when teleworkers are sick, they will tend to work through it, at least doing the minimum until they have recovered.
Also, remote workers can complete errands and family commitments without taking the day off work by calling in sick or using a holiday.
The final benefit is that if a sick person comes into the office, there is a real chance of infecting others. This places a large pressure on workforce productivity because, in offices, the common cold spreads very quickly, knocking out significant portions of teams and the workforce.
 
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15. Ability To Hire The Best Talent Anywhere
Your workforce’s talent is one of the core defining factors of business success in today’s highly competitive knowledge working environment.
The best young talent in today’s job market has their pick of jobs and locations. Fewer people are willing to move across the country solely for work, leaving their friends and family behind. This means implementing a flexible work policy allows you to tap into the best talent that is not in your given location.
Over 70% of employees consider that the ability to work remotely is “somewhat to extremely” important to their selection of an employer.7
The size of the talent pool that you can tap into is exponentially increased with strong telecommuting policies.
Also, because the talent pool has increased competition, you can choose the best talent for the optimal price.
16. Improved Employee Satisfaction
Millennials have a different outlook on life than other generations. In the age of digital business and knowledge workers first, the expectations have changed.
Millennials are just as competitive, if not more competitive than older generations, but they also expect to have a great quality of life, not simply to be part of the herd of sheep slogging their way to work in traffic jams which pollute the environment, sap their energy and waste their time.
Personally, I am not a Millennial; I am a Gen Y’er, but I reached this conclusion a long time ago. When I am with friends who complain about the traffic in their city and how late they return from work, I consider myself truly blessed to have been a remote knowledge worker for over 13 years.
Gen Y’ers are more difficult to recruit (as reported by 56% of hiring managers) and to retain (as reported by 64% of hiring managers), but they are particularly attracted to flexible work arrangements (rating among benefits as an 8 on a 10 scale for impact on overall job satisfaction).8
When I actually attend the office, I get on a plane and fly to the USA, Europe, or Asia. I will spend a week or two at a location and then return home to continue my regular work.
It is a great way to work.
17. Improved Workforce Inclusion
Here is a very interesting benefit; the fact that someone is approaching retirement or has a physical disability should not exclude them from the workforce.
Older workers are mostly too tired or unwilling to keep doing the commute. For physically disabled people, the commute can be arduous. Understanding that these people still have a huge amount to offer in terms of experience means you will benefit from having the right remote working policies.
Telework policies are inclusive and can drastically improve the quality of life of these workers.
Also, some academic studies suggest that remote working reduces discrimination. Even in today’s webcams and video conferencing environment, most remote meetings are conducted using voice only. This contributes to people being less discriminatory against race or color because you simply do not see the people. This, of course, increases the likelihood of people being judged on performance and results and not the color of their skin.
Improved Perks / Benefits To Employees
18. Greater Employee Flexibility
Remote working is considered a big benefit to employees; more and more millennials see their flexibility and quality of life as priorities above all others, including salary. Thus an inclusive and strong telecommuting policy directly contributes to their wellbeing.
Flexibility to exercise
A long commute and a long working day mean employees need to decide if they exercise or spend the remaining few hours of their day with their family. This means exercise often takes the back seat.
Improved flexibility to manage responsibilities at home
However inconvenient a family might seem, the fact is, families exist, and they are important. Flexible working styles allow workers to manage better their children’s school runs, extracurricular activities, and doctor and dentist appointments. The fact you can have breakfast or tuck your children into bed at night is a huge plus.
This does not impact the employee’s ability to deliver on goals as they are highly motivated due to their higher job satisfaction.
19. Seen as a Benefit to Employees
The fact is that all members of the workforce see huge benefits in remote working, whether full-time or even two days per week; the added flexibility is seen as a nirvana for workers.
80% of employees consider telework a job perk 10
The perceived benefits of telecommuting for employees:
- No Commuting – Time Saved Every Day
- Lower Carbon Footprint
- Decreased Commuting Costs
- Decreased Chance Of A Motor Accident
- Improved Ability To Manage Children & School
- More Family Time
[Related Article: The Benefits Of Telecommuting/Working Remotely 27 Pro’s & Cons]
20. Lower Levels of Employee Stress
There are multiple causes of workplace stress, but even getting to work is stressful for employees. Psychologytoday.com reveals that “It can be a major cause of stress, due to its unpredictability and a sense of loss of control. Commuters can experience boredom, social isolation, anger, and frustration from problems like traffic or delays.”
Improved work-life balance and more family time for employees means less stress.
Also, employees do not encounter the high levels of stress involved in personality clashes or workplace politics.
If they need to take a break or have a power nap to freshen their mind, they can because they have more flexibility. No prying eyes are watching the employee’s every move and judging like in the office; that is stress relief in itself.
On the other hand, as the employer, you will need to vet that you only allow the right employees to engage in full-time telework. They need to demonstrate the ability to work unsupervised and have a track record of delivering against their goals. A strong work ethic and independence are the keys to a successful home worker.
21. Marketing Value for New Hires
There are incredible marketing benefits to having a solid and well-implemented teleworking / remote working policy. This section discusses how you can sell these programs, both internally and externally, to prospective new hires.
As 80% of employees consider working from home a job perk, you can safely list this and the rest of this list on your hiring campaign literature.
22. Seen as a Progressive Company
You can demonstrate that your company’s IT infrastructure is geared up for the next generation of workers. Progressive companies show mastery of technology to enable and empower their workforce.
Technology That Empowers A Mobile Workforce
- Laptops, Tablets, Smartphones
- Virtual Private Networks: Secure communications from anywhere
- IP Conferencing: Skype, Google Hangouts
- Collaboration Tools: Microsoft Sharepoint, Slack
23. Environmentally Friendly
As our world is simply on the verge of climate catastrophe, moving your workers to remote home offices is not only the right choice for the planet, it demonstrates your commitment to reducing your carbon footprint. Younger generations care more about the environment than any other, and demonstrating your commitment to robust clean energy and carbon neutral work environment is a marketing windfall.
24. Pro Work-Life Balance
As discussed many times in this article, the reduced stress and improved flexibility result in a considerable boost to the employee’s wellbeing. Work-life balance is the future of work, and you should market this as a key benefit to new and existing employees.
25. Societal Benefits
The fact is, the commute is the biggest negative in our working lives. Removing the commute from the equation means not only benefits to the employee of time saved and a lower carbon footprint, but there are wider societal benefits.
Not all people can be remote knowledge workers; there are many jobs where you absolutely need to be in the workplace. Think about the warehouse packers at Amazon, street cleaners, dentists, or anyone else providing physical services.
Taking knowledge workers out of the commute means less stress on the commuting infrastructure, meaning that the roads, trains, and underground systems are freer for those who absolutely need to be physically at their job. This is a benefit to society.
26. Increased Mortality
According to the Federal Highway Commission, the average number of miles per car accident for the average US driver is 165,000. In our example of 30 miles per day, you would cover 241,500 miles.
This means you would avoid one car accident in your lifetime. Also, 1 in 77 car accidents is fatal, so that means it is undeniably better to telecommute than really commute.
Summary: 26 Proven Advantages of Remote Working For Employers
Of course, few companies will ever make it to 100% home working for their employees, but this does not need to be the goal. Flexible work arrangements have as many benefits for employers as they do for employees. From cost savings to employee wellness, the advantages are clear. It is probably time for you to create a beneficial working from home policy for your staff.
I hope this article provides everything you need to position your company for implementing a solid flexible workforce strategy.
If you enjoyed the article, please share it with others and leave a comment below.
Citations
1-10 research conducted by globalworkplaceanalytics.com who data mined over 4000 telecommuting academic research papers.
Don’t work for companies who exploit employees by cutting their pay.
I’m all in favor of companies letting people work remotely, but you’re advising people to take a pay cut for saving the company a ton of money.. at the very least they should get a pay RAISE of 1/2 what the company saves via them working remotely to do anything else is exploitation (PERIOD).. This is another giveaway to corporate greed if people do this.. Forbes quoted that the average remote employee saves a company $22K a year. As I was a manager in high tech and calculated the loaded rate for contract work I find this very low really if you are dealing with a professional staff.. But here’s a great quote.
“That old way of thinking needs to die because it exploits labor. The employee’s labor provides the same value regardless of working location. The circumstances changed, so we need to force things to change as well. Don’t accept a pay cut for changing your location. Ask the company tough questions. Is my value to the company less if I live in North Carolina or Colorado? If they won’t budge, quit.”
I agree with your point. Some might take an offer like this, some not. Good point thanks.
Barry
I enjoyed your commentary especially the personal references and knowledge. I do agree that pay cuts should not be part of the issue. Although I would take a pay cut to have the freedom offered, it’s a simple fact.
What I am missing in your article is how managers would need to change their traditional ways of thinking to engage and evaluate employees. Face time seems to matter when it comes to promotions. Even when working in the office, it is not unusual for an employee to be passed over for promotion because of lack of face time. I understand that it is in an employee’s best interest to cultivate that relationship, especially when working remotely. However, as a diligent employee, it is not in my nature to chit chat with my supervisor, if my job does not bring me in contact with that person for a job related reason.
I’d love to read a commentary on improved manager relations. In my experience, people are promoted to supervisor status based on work performance, not their capacity to motivate, educate, or evaluate employees.
Great thoughts Kat, I appreciate it. Barry
Remote workers working for free? Can you explain more about how this can be ethical in any company? Because it’s not all about working for free. In fact, you can be more productive as a remote employee working less if you manage your time correctly. So, this appreciation is misleading.
Hi Vivian, the article cite research that shows people working remotely tend to put in extra hours that they do not bill for. I am not suggesting they should, the fact is they do.
thanks for your comment.
Barry