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Shifting Expenses in WFH - Becoming the Progressive Employer

Shifting Savings and Expenses of WFH - Become the Progressive Employer

Many companies are now seriously considering on scale WFH programs for many groups of employees, given the overall success of connectivity, output, customer experience during the pandemic.   There are serious benefits to be gained with expanded WFH programs, including expanded talent/applicant flow, heightened employee satisfaction, and serious cost savings.

Here are some basic insights and considerations:

  1. Company costs per employee are reduced by an average of 35% per EE per annum (included increased cost of licensing to extend to last mile, like ACD connections and drastically reduced costs of real estate, operating expenses, consumables).
  2. On the other side of the equation, employee costs are rising going from zero to $3,000 per year for increased power, internet, office/kitchen/restroom supplies, desk and office setup/maintenance, perishables. That estimate doesn't include more space at home (larger apartment or house). If a person works 1/2 time at home, and 1/2 time in office, the added (new) expense for employees might be halved (i.e. $1500 per year).

The key takeaway is - many companies will experience a material windfall in terms of real estate and related cost per employee by enabling a long term on scale WFH program, while employees pick up a material burden.

Is your company willing to shift some of the realized savings back to employees? Here some options for consideration:

  1. Pay a monthly "WFH office allowance" to FT WFH employees, and pay 1/2 for PT WFH employees.
  2. Contract provider service or pay for a separate business class Internet line used exclusively for work by employees.
  3. Establish a "WFH Flexible Spending Account" that pays out monthly or quarterly to employees to cover some of the costs associated WFH.

Whatever your plan, a solid practice (and totally acceptable during this new and different period) is to advise your employees that the new guidelines are temporary (i.e. 2021 only) and will be evaluated several times as restrictions are removed, WFH programs expand, and results are weighed.