A new CEO says employees can’t work remotely after all, and they revolt
wsj.com
wsj.com
This right here is the entire reason. They like to say things about collaboration and innovation, but commercial real estate is really the reason (and tax breaks).
I wish companies would just be honest and tell people, "look we know you don't like it but it's better for our business because we need those tax breaks and real estate price support".
Edit: Instead of replying to everyone, I'll add it here: the tax breaks are butts in seats tax breaks. They have already committed to long term leases or own the buildings, so they can't get out of it by "just closing the office". They can't close the office. So they need those butts in seats tax breaks and if they own the buildings, they need the prices to stay high.
> How is this even regulated and controlled?
Same as... most things? There's all kinds of stuff you can lie about and be fine as long as you don't get caught. Claiming you have a full office while openly having a 100% WFH policy is probably not a great way to get away with that kind of fraud, however.
But the real issue is what happens when the lease runs out. A company that's using its office as "office available" is really "remote, but with an office that we're staffing for tax breaks to offset the cost of the lease we're stuck in". The tax breaks aren't bigger than the lease, so once they're out from under the lease obligation they switch to 100% remote.
Google [Do companies get tax breaks for in person employees] or something like it.
This is an incredibly short term decision of course, what would be a lot more beneficial would be to push for remote work and let local businesses develop all around the city in residential neighbourhoods, which would after a while lower CoL everywhere, while still having the same amount of money spent, just spent more equitably geographically speaking.
But of course when your political term lasts 4 years, you don't give a single fuck about all that, you care about your next election.
Google [Do companies get tax breaks for in person employees] or something like it.
Looks like for SF it is beating back some of the taxes I mentioned earlier. If you don't have the people in the office, of course, you don't get the tax incentive but you don't get the tax in the first place.
In any case, this is actually good since we have an office here and we're all in-office and looking for a new one. That 0.45% might be good.
[1] https://www.cnbc.com/2020/07/07/seattle-passes-payroll-tax-t...
The orgs I'm familiar with that went fully remote just sublet their office leases through the end of their term.
https://www.vox.com/recode/22356628/working-remotely-state-t...
> Taxes are, of course, more complicated than that, especially if your job happens to be based in one of seven convenience of the employer, or “convenience rule,” states — Arkansas, Connecticut, Delaware, Nebraska, New York, Pennsylvania and, since the pandemic, Massachusetts — while you’re living and working elsewhere.
7 / 50, so technically your statement is only 86% true.
In other words, the IRS doesn't really care what a company's HQ address is on paper. They care a lot more about where the company is actually operating, even if there's not a physical office.
insurance companies typically invest the premiums, to hedge against claims. 2 very popular ways of hedging is owning commercial real-estate that brings in monthly income, or investing in commercial REIT that own many, many large buildings, hotels, etc.
A conspiracy about commercial real estate doesn’t make much sense from the perspective of a company like Google.
They might care about the “waste” of their own property, but why would they care otherwise?
My guess is that leadership truly believes something is lost with WFH.
(aside from commercial real estate companies, obviously) Some companies own a lot of their offices, but I don't know how many. I'm guessing it's mostly random mom-and-pops and corporate giants.
I don't buy the argument that it's all about real estate because real estate should have already been marked down on the books, so you're trading potentially higher property value for an increase in opex for utilities, janitorial, etc. Investors prefer the opex win. They didn't buy FooCorp as a commercial real estate play.
You got by for decades floating by on overinflated prices and passive income. I'm sorry your golden ticket has slipped a little, but maybe we can tear down some of your ugly grey boxes and build affordable housing to combat actual problems: inflated housing prices, lack of housing space, lack of affordable commercial space for small businesses.
If I see: premium, luxury, professional, (etc)
words that classify something to be better, I assume that they really are substandard and are using words like above to make it appear as it is the case.
I like government. It provides a framework we all know about, can interact with, and know that everyone's being treated to the same standard.
And where you have better governments, it works well. Sure, there's complaints about all implementations, but I prefer a stronger "typed" system. I can plan for it. I can use it. And best of all, I can rely on it.
At least in the USA, the problem is that government is underfunded, blamed for bad service, and underfunded some more. And crazy stupid ideas like "social security is the biblical revelations mark of the beast" is some of the reasons why where we are.
In my state, the bureau of motor vehicles was identified as "terrible". Investigation was made, and found that it had to do with not enough workers, not enough "open time", and bad communication to customers (us drivers). My state then increased workers at all branches, increased hours on some days to accommodate a wider array of schedules, and now our BMV is superb.
So no, I whole-heartedly reject that "government-issued" is in the same class. I refuse to play in faux libertarian narratives.
Or worse, when the same people that parrot the rhetoric that leads to "small govt" get faced with the richer/more developed states deciding to use their "states' rights" to implement those things on their own, they all get together to label it "unconstitutional". Usually out of fear of the influence it will have on their constituents.
It's easy to generalize about about a job one has never done. Building, maintaining, and renovating property to keep up with tenants' demands takes capital, effort and brains.
Workers do all that, not landlords.
A carpenter does not fix a leaky toilet, nor does a plumber decide if a kitchen needs a new floor.
Someone is responsible for ensuring that the right job is performed by the right expert at the right time and is the one ultimately responsible for its success. This is the person you call and yell at if the job is poorly done. It's also the person you pay when it's done correctly. He is the landlord.
Workers don't spontaneously come together to erect and maintain buildings, they need a driving force behind them that swallows the risks on top of having the skills required to organise, synchronise and negotiate with many specialists covering many different fields and trades.
He is only the rent-seeker my dude.
Now that one of the avenues for rent-seeking is declining, they cry that the peasantry should return to the office, may the passive income never die.
Well...yeah that's what a landlord is.
Another kind of rent seeker would be a dude building a small SAAS product by stitching together other people framework, paying a copywriter for his blog content and a designer for his visual. Another is a dude investing his money in bonds/stocks hoping for a return.
There are many kind of rent seeker in this world. Each requiring a different set of skills, expertise and appetite for risks. Someone doing that through real estate is called a landlord. It's not better or worse than any other kind.
Yes, we are in agreement.
> There are many kind of rent seeker in this world. Each requiring a different set of skills, expertise and appetite for risks. Someone doing that through real estate is called a landlord. It's not better or worse than any other kind.
Let's not put makeup on this particular pig. I am a rent-seeker myself. Just not a hypocrite that will pretend that I have a particular set of skills that contribute anything to the world.
I just saved money acquired through labor and bought dividend stocks.
Of course we do! We've done it throughout human history.
Civilization did not start with a landlord demanding the construction of a house.
The mere existence of open source software negates your entire argument here. Not only does it exist, but it ultimately underpins all the technology we enjoy today (and what rent-seekers enjoy appropriating for profit)
In the books you will read the names of kings.
Did the kings haul up the lumps of rock?"
In short, if a city finds itself not needing office towers, most probably it won't be able to afford affordable housing neither.
And those cultural institutions still need service workers. And people working from home in cities still need service workers too. And the restaurants.
There will still be plenty of jobs for folks at the lower end of the spectrum, even if all the offices become housing. Arguably even more, since there would be more cultural institutions open at night.
I think it's more likely that some people really like to work from home, and other people really like the office. And that's okay! People have different preferences and circumstances. The only issue is that it's one of those things where both sides can't really have their way at the same time, because it defeats the purpose of an office if you're the only one there.
Of the 22,000 people who work at Farmers, 2,000 have reacted negatively. (Yes, I assume it's higher b/c some people don't want to publicly disagree with their employer.)
Overall, I think everyone simply has a preference, but it's become an escalated debate. I think eventually we'll see half of companies being remote and half being in the office, and everyone will get to make their own decision for what works best with their goals and lifestyles.
(All that being said, in this situation, telling people they can work remotely and then changing it is pretty crappy.)
I think most people who run companies are sociopaths who don't care about their employees. That being said, I think this is a situation where there's no hidden agenda... I think it's fine to disagree with their decision, but ultimately they genuinely believe it's better for the bottom line to have people in the same place.
Another possibility: most people who run companies are actually aware of different types of jobs and employees where in-person interaction is needed, compared to loudest proponents of WFH on HN who may be projecting their unique situation (solo coder getting work done much more efficiently on small isolated projects).
To the people who spend most of their time playing in the high-levels of this power-capital-land game, a transition away from office work to work from home doesn't look like what they're used to. Sure, in reality their power has been in the form of command over huge amounts of labor and resources for ages, but there's always been the physical representation in the form of the office, the factory, the tower.
The elimination of this symbolic representation of their power plays on an anxiety about the legitimacy of their power. Their power is capital, control over resources, control that is granted to them via a web of social contracts that ultimately rely on tinkerbell logic, that is, it exists only so long as people believe in it. Any large scale change in the representation of that power comes with a (small, but not non-existent) chance that people might stop believing.
So, not sociopaths, just powerful people uncomfortable with the ever shifting landscape of what it means to be powerful.
Not our problem.
"Don't buy things you can't afford" applies to capitalists, too. They insisted on cramming everyone into loud bullpen office spaces, decried WFH as "laziness" or a "privilege" for years, failed to invest in modern technology, and now their big dumb plan is backfiring. Sounds like a valuable lesson!
Neither is someone not finding a WFH job and having to RTO. Ultimately, it boils down to who has the most leverage.
My predictions for tech jobs: 1) most of the jobs will be hybrid in future because everyone loves Monday and Friday WFH. There will be a minority of jobs on either extremes (fully WFH, fully office). 2) Within those super smart people who will always be in demand, there will be all types of preferences (some WFH, some office, some hybrid). 3) For the rest who are mere cogs, they will meekly follow whatever their company dictates.
It kind of reminds me of schools who are afraid of kicking out disruptive students because they are funded based on student count. It's usually better for disruptive students to go to special schools, but the butt-based-funding mucks that up.
Because it's not even ultimately about corporate profits (outside of real estate companies that is) as real estate holdings these days are largely a cost centre for most companies, and most companies were selling their RE holdings long before remote work was ever a thing and leasing back their offices from the companies they sold them to.
This is ultimately about the personal wealth and power of the elite class, who's wealth is heavily concentrated in real estate. Nobody goes back to the office the companies financials look broadly the same, but the owners / shareholder's personal portfolios look a lot, lot worse.
It’s less than 10% of all US assets ($270T).
But the average company has no potential tax breaks, has the potential to save money by getting rid of their office space, and doesn't care about the financial outcomes of large real estate investors or lenders.
I think they believe returning to the office is good. I would agree with them that some things are hard to replicate in a remote environment. It's hard to brainstorm a new project in a Zoom call.
But I think many prefer an in person work setup because they are bad managers. Bad managers are not good at setting a vision for a company or building in organic, helpful checkpoints for progress and accountability. They don't actually state what anyone at the company should be doing. Expectations are often unclear. These bad managers have very little way of knowing if their employees are working.
So they go the lazy route and use presence and the appearance of busyness, in the office, as a poor stand in for good management. There are benefits of being in-person. But whenever I see a decree for in person work, I think it's usually just poor leadership.
I would say the best dynamic for most, not all, companies is a remote work environment where people can get together as needed. Well before the pandemic I worked at GitHub. At GitHub we worked remotely but we got together often to have a hack house where we worked together solving a problem that needed brainstorming or deep thinking. I saw my fellow employees often. It was the best of both worlds. A remote first company with opportunities to get together as needed is the gold standard. A fully in person is too extreme. A fully remote company without the chance to get together is also a poor experience and is very isolating. Both too far on either side of the spectrum.
+1 to that in theory though in practice, it is hard to pull off if everyone is geographically scattered. Key constraint boils down to everyone's ability to attend in person - you always miss around 10-15% of attendees. And then there is not enough ROI on all the expenses you have incurred for that offsite (air, hotel, cabs etc). If people are in the same geographical area, then probably it is not a problem.
And this all assumes long term leases or you own the building. It's possible to pay to get out of leases some time, and you can sell the building if you think it's going to cost millions to keep owning it.
Also, we are seeing lots of smaller businesses also requiring people to come back to the office. If they are getting some huge tax break for a 100 person company, how much is that? I'm happy if I'm wrong, and this is some huge tax break that saves companies millions of dollars, but I think it's fair to ask for evidence that this really saves the money people claim it saves.
I think there are other dumb reasons people are being called back, it just doesn't feel like this is one of the reasons.
https://www.bloomberg.com/news/features/2023-02-21/another-t...
Also, I didn't say tax breaks was the only reason. I also said commercial real estate prices. Even companies that don't own buildings need commercial real estate to stay up, either because their owners own some elsewhere, or because other business products are priced based on commercial real estate (one common example is corporate insurance treasuries often hold a lot of corporate real estate).
So this "revolt" was the same as any other return-to-office "revolt"... a bunch of crying about how unfair things were on some internal social platform, and then quiet acceptance of the new-new normal. Even the Amazon "walkout" protest last week only got 100 employees to show up.
As it was pre-COVID, if you want a flexible work situation, make yourself valuable enough that you can demand it. Senior and specialized roles were frequently WFH pre-COVID simply because local talent didn't exist, even in markets like SF or Seattle.
If your role is "generic tech employee doing generic things at large corporation" you don't have bargaining power. It might not be fair, but until unionization happens, it's the way the world works.
The owning class right now is collectively moving to worsen work conditions by colluding in getting people back into the office. Workers should answer collectively as well or it will not go anywhere. Sure, you can change employers, but more and more employers are cracking down in the same way.
Your solution of voting with feet is an extreme countermeasure, many people want to improve 1 or 2 things about their workplace, not leave. Unions help with all of this.
For a lot of companies, that's a feature, not a bug. You get to avoid layoffs and all the costs associated with that.
It seems like part of the contract is being broken if you were hired for a remote job and then told you have to come into the office.
At will employment obviously means you can fire them, but can you just change the terms of the contract at will?
"I will pay you $79,000 for this position," followed by pay of $25,000 is obviously not legal. Where is the line?
And you have to quit basically right when the change happens, or very soon thereafter. If you try to live with it for 6 months and ultimately decide it's untenable, they're going to say, "Well you lived with it for six months. It obviously wasn't that untenable. So no benefits for you."
(Source: Spent years adjudicating unemployment claims at the initial application and appeals levels.)
There's not contractual obligation on the part of the employer to actually do what they say they will?
Its not that unions are somehow pure wonderful organizations. They fail like any human-run org for the similar reasons.
The unions are required because only a union is "big enough" to stand up to a company, and to sit down at the big negotiating table. You, an individual, can easily just be told to go pound sand.
If an individual tries to go against this Farmers Insurance takesies-backsies of remote work, your recourses are to: follow their orders, quit, or refuse and make them fire you. As an individual, you have NO power.
At a union level, those choices are more numerous and back-breaking to the company. They can't just fire all workers. Minor sabotage in the forms of work stoppage and slowage can also significantly hurt a company engaged in this sort of crap. And the union is "big enough" to have a sit-down and negotiation to resolve this.
You're never going to get a honest sit-down and negotiation as an individual when the CEO wants something. But that union will.
Your options are always the same. Stay or go.
I’d be willing to bet that any employment offers made since the 2020 WFH blitz for the legally savvy organizations have stipulations that the employer can control the working location, and of course the employee can choose to leave if the location changes in a way unfavorable to them.
More than once in my career I have been at a company where the office location changed. I didn’t get to say “no, you can’t move my office because this is where the office was when you hired me”.
I haven't run the numbers, but anecdotally a lot of these deals seem to be with companies that were having trouble anyway, or in the middle of a deeper structural / debt foozle.
It's a time honored tactic to pressure out headcount in lean times with workload, bathroom closures, and other joyous things.
Despite not mandating in-person work for most of last 3 years, tech and non-tech companies have shipped great products, delivered many high quality projects; on time and within budget, thereby proving that mandatory in-person work is not necessary to make a healthy profit. Given that WFH has other benefits for both employers (lower office costs, access to a larger pool of talent etc.) and employees (reduced commute times, more flexibility of work etc.) so the return to office should be because the benefits of in-person work are above and beyond these advantages. Has this been proven? Can we see the studies? Mark Zuckerberg said that newer employees under-perform because of lack of in-person interaction. Fine, but are there any groups that outperform? What about introverts? Single mothers? Differently abled people?
I would have thought that this was an opportune moment for some of the top companies to poach some top talent. I would have thought that at least one FAANG company would permanently remove the mandate for remote work causing people who wanted the flexibility to start to apply. This would trigger a 'wfh-benefit-war' among the big companies and the smaller companies would follow. However, all the FAANG companies have announced in perfect unison that workers would be mandated to come back to office.
My strongest suspicion is that there is some sort of market failure in the employment market.
In fact, availability of talent cuts both ways. If you are unhappy and quit, you can be easily replaced in this environment because there are 50 other desperate candidates willing to take your job. CEOs are very smart and know this.
> My strongest suspicion is that there is some sort of market failure in the employment market.
Some alternative possibilities (not mutually exclusive): 1) WFH is not as popular and necessary as some of the loudest voices on HN would have you believe. 2) there is a genuine value in in-person setups and CEOs see that whereas you don't. 3) CEOs are actually smart, rational people who can think 2-3 steps ahead (contrary to the comments I see here about them being dumb sociopaths following a herd mentality)
the same CEOs that decided to over hire during the pandemic and then started to layoff people when money stopped going in?
Huh? It's not a feeling at all, it's actual reality. CEOs hold nearly complete authority. Companies are dictatorships, with tremendous power over their subjects.
"Democracy in the workplace" is a core aspect of socialism.
That's all this push to get workers back to the office is ultimately, a bald-faced attempt by the wealthy powers that be to make everything worse for everyone else, all so they can continue to get richer at an ever increasing pace.
Remote work fundamentally undermines one of the cornerstones of elite wealth, that being the ownership and leasing of commercial properties. The entire industry is essentially a giant exercise in rent extraction by the wealthy, as they're giving essentially free money from the banks (if you're rich enough you get all the money you want for free!) to buy these properties, then lease them to the actually productive businesses that do things like make stuff and provider services, all while cashing fat rent checks while their properties simultaneously appreciate. It's like a giant money printing machine that's only accessible to those who are already wealthy, and remote work throws a giant monkey wrench right into the middle of it.
No wonder all the CEOS and corporate funded think tanks are suddenly up in arms about "Productivity," "Communications" and "Connectedness" as if workers don't come back to the office, their giant commercial real estate money making machine slows, falters and will ultimately fail, and then god forbid the rich folks would actually have to go back to actually doing something productive to make more money.
> The day after the outpouring of criticism, Vargas sent out another companywide email, according to employees. “It said: ‘We read all your comments. We understand and we appreciate them. But we’re still moving forward,’” one Farmers employee said.
I assume plenty will quit over this. Many will have to. I'm criticizing the article, not the employees.
There are enough companies out there consistently doing this that remote work is now going to just part of the work culture everywhere. Some of these Farmer's employees are going to quit and find other remote jobs.
Sounds like you may read them, but you don't understand or appreciate them, Mr. Vargas.
No horse in this race: Can you actually adequately home school a child and also adequately work from home?
If the child is old enough to 'self study' as long as the adult is in the same building for legal reasons? Seems plausible.
For younger children, generally our society is insane and has it's values system maladjusted in favor of having useless worker drones rather than high quality citizens for the future.
However ignore the HOME-schooling part. Maybe their kids are in private or public school and the parent works during that time, answers emails for a couple hours on either side, but has flex time. THAT seems to be what's more commonly actually done.
Here's how I think they should have done it:
- If you live within X distance you must return X days out of the week - Employees living further must come on-site X amount of times per year - All new hires must work from in office all or X days out of the week
I assume you mean 2020? I think many if not most of us are working at companies that didn't exist in 2000.
>Complaints on the internal social-media platform included those from workers who said they decided to home-school their children and take care of elderly relatives based on the assumption they could keep working from home.
This seems to imply they are multi-tasking work and home duties and there's enough evidence that multi-tasking doesn't really work well. On the other hand, though, the employees claim their productivity is higher than pre-pandemic, so it's hard to gauge the truth here.
Edit: I don't care about the downvotes but it would be helpful to the discussion if you add why you disagree. Do you think multitasking is feasible? Do you think the employees are not being honest about their productivity levels?
I don't think one set of interruptions is inherently worse for productivity than another.
And honestly the most interruptive thing for me is meetings that could easily have been emails, so...
It's not unlike an employee who wants to work remote so they can manage a side-hustle. Maybe that side gig only takes a few moments of the day but I think most employers would have reservations about hiring someone who's trying to juggle multiple jobs. I think most people would agree there is a tipping point where your side hustle comes at the expense of contributing to your main gig.
The coworker interruptions may make you less productive personally, but the team more productive is it’s a work related interruption. Also, research seems to show that “small talk” interruptions contribute to overall performance. I don’t think that same tradeoff is apparent with home interruptions.
I think my position is that it's up to the employer/employee to manage that expectation and there probably should be hard expectations based on what seems to be a weakly formed agreement.
It was the business that claimed productivity was better with remote working, not the employees.
It's an unsourced claim from the employees. And I agree on the "decent" productivity piece.
We were also told that remote working was a great success and productivity had actually risen over a couple of years. Now of course they want us back in the office a few days a month because reasons. Since our whole job involves talking with people spread across the US, the UK, India and external partners (not with other members of our team), I'm not convinced there is any boost to commuting into a noisy office filled with people on WebEx calls...
Of course it is.
I have no idea how I would've handled the last decade of my life if I wasn't working from home. I am sure that some people can't multitask, some people just work less from home. I am also sure that for most adults with kids/homes/parents to take care of, working from home means getting WORK done and also managing all that other stuff. It just would NOT be possible working from an office.
At some point, I think you have to acknowledge that multitasking worsens performance. It's really up to the employer to determine if that is still a net benefit to keeping someone on.
I run a couple of marathons a year, but I sure wouldn't try to finish one every week.
It's like the comment above that equated familial interruptions to coworker interruptions. The former is generally a net negative to the company while the latter is not. The comment seems to view everything from the lens of the individual.
* there's probably a valid argument as to why they feel compelled to that matters and the article doesn't exactly put a fine point on it
Ok, I get the first one to an extent, but why does an insurance company depend heavily on "creativity" and "innovation." I thought insurance is a pretty straightforward numbers game.
I was wondering if companies would put their money where their mouth is and pay more for attendance and let the problem solve itself. I would trade a couple days for more salary, maybe even a whole week! Think of it as location repricing in a more favorable direction. Instead, we are seeing it as a soft layoff. C'est la vie I guess.
Lets call this what it is, the CEO attempts to change the culture top down and the employees complain but ultimately go along with it.