Work from home battle lines are drawn: Apple, Tesla, Twitter & Airbnb

Sascha: [00:00:02] From Equity Mates media. This is the dive. I'm your host, Sascha Kelly. 

Audio clip: [00:00:07] This week will mark two years since millions of employees started working from home because of the pandemic. 

Sascha: [00:00:12] Now, I can only speak for myself when I say it certainly wasn't possible for me prior to the pandemic. But now what? To use the phrase learning to live with COVID. Working from home seems to be part of the new normal. 

Audio clip: [00:00:26] Many employers say remote work may be the next goldmine. 

Sascha: [00:00:30] But not every company is embracing it. Last week, an email from Elon Musk was leaked with a line that he would assume his employees had resigned unless they spent more than 40 hours per week in the office. And it certainly got our office at the dive talking. But we wanted to go beyond Elon. It's Wednesday, the 8th of June. And today, we want to know, is working from home just a phase? And will there be pressure to return to the office on the horizon? What is the new normal? To do this, I'm joined by my colleague at Equity Mates Darcy Cordell. Darcy, welcome. 

Darcy: [00:01:06] Thank you, Sascha. Nice to be here. 

Sascha: [00:01:07] Darcy I wouldn't say that working from home is news. Why are we talking about it today? 

Darcy: [00:01:13] So Elon Musk's email was leaked and headlines were made around the world. 

Audio clip: [00:01:18] Musk is ordering his employees to get back to work in person and spend at least 40 hours in the office.

Darcy: [00:01:25] A few CEOs and billionaires responded on Twitter and more headlines were made. But we didn't really learn anything about the overall state of the work from home trend. Is Elon the outlier or is this leaked email in line with a broader return to the office trend? So as you said, we wanted to dive a little deeper than the headlines and understand what's happening around the world.

Sascha: [00:01:46] Yeah, because Elon's email wasn't exactly well-received by a lot of other CEOs, was it? 

Darcy: [00:01:51] You're right. We saw a bit of a billionaire bust up, Sascha.

Sascha: [00:01:54] I like that phrase. We should use that will.

Darcy: [00:01:56] So Scott Farquhar, the co-founder of Atlassian, he responded to the Elon reports on Twitter saying that it sounded like something out of the 1950s, Atlassian, something we spent a lot of time thinking about, is the future of work and basically joking that they'd hire Tesla employees who wanted to work remotely. But it's really been an issue on a lot of people's minds. It's just that Elon really sparks conversation when he speaks. 

Sascha: [00:02:22] So let's broaden it out. It feels like we're seeing a range of responses from companies, from the work, from home trend. They've all got different policies in place. 

Darcy: [00:02:30] Yeah, that's right. As we move away from lockdowns and restrictions from COVID, the debate around remote work is heating up prior to the pandemic. Working from home is pretty rare, with the exception of Scandinavia and a few other places in Western Europe. But now 38% of respondents surveyed in Microsoft's 2022 work trend index said they work in a hybrid office. So that's a mixture of working onsite or in-person and working from home or remotely. And career ladders predicts that 25% of all professional jobs in North America will actually be remote by the end of this year. 

Sascha: [00:03:06] That's pretty high and pretty soon. 

Darcy: [00:03:08] It's really settled and really high, Sascha. But I think if we scratch below the surface of these top level numbers underneath, we're seeing a full spectrum of responses from companies. On one hand, we've got the return to office crowd and Tesla is now headlining that. 

Audio clip: [00:03:23] JPMorgan is telling its floor trading staff to come back to the office. 

Audio clip: [00:03:27] Here in New York, Mayor Eric Adams took a strong return to work stance, saying you can't stay home in your pyjamas all day and is. 

Sascha: [00:03:34] Back to work for Apple. 

Darcy: [00:03:35] Employees. 

Audio clip: [00:03:36] Absolutely. They're being told to come back to the office place. Well, since a couple of years now since the pandemic started.

Darcy: [00:03:43] A survey from Microsoft suggests that 50% of executives want to return to the office five days away. Now they're the executives. But just 17% of employees said they want to return five days a week. We've got a pretty big gap here. 

Sascha: [00:03:56] Yeah, it's really interesting because it does feel like it's hard to separate the ego or your personal experience of work from how productive you are or how successful working from home is. Those companies managed to work pretty successfully over the last couple of years and I imagine there was a lot of working from home. So the can't say it completely doesn't work. 

Darcy: [00:04:17] That's a good point, Sascha. And I guess to speak on that, we've got the other side of the coin, which is being led by Airbnb. So Brian Chesky, their CEO, has told employees that they can work from anywhere in the country they live without having to take a pay cut. 

Audio clip: [00:04:32] And the reason why is I do think eventually within countries, wages for people working on laptops are going to start to converge and people are going to be moving around a lot more.

Darcy: [00:04:41] And staff have the option to live and work in 170 countries around the world for up to 90 days of the year. 

Audio clip: [00:04:48] So we want to just leave what I thought was an inevitable trend. My prediction is this is where the world is going to be ten years from now. 

Darcy: [00:04:54] They plan for most of their staff to connect in-person for just one week. Every three months. 

Sascha: [00:04:59] One week, every three months you have. To go in and see someone. That's it. 

Darcy: [00:05:02] That's it. That's it. I mean. 

Sascha: [00:05:04] I love Equity Mates, but every movie looks like it's great right about now. 

Darcy: [00:05:08] No, Sachin, we love you. More than one zeroth robot twit is now. The company has taken this approach. They're allowing workers to work from home permanently, depending on their role. 

Sascha: [00:05:18] The company says its experience over the past few months, it shows remote working has been a success. 

Darcy: [00:05:24] It's going to be interesting to see how Elon Musk handles this if his Twitter takeover is successful. 

Sascha: [00:05:29] Absolutely. 

Darcy: [00:05:30] Spotify is another company which has options to work from anywhere in the world, but it also depends on your role.

Sascha: [00:05:36] Great. So those are the two extremes who've got the work from home whenever you want. See colleagues occasionally. And then we've got you've got to come back into the office 40 hours a week, minimum five days a week. We want to be seeing your face. There's one more option that we haven't talked about, and that is the hybrid. The people in the middle. What's going on there? 

Darcy: [00:05:56] That's right. This is where the majority of companies come in, Sascha, where people come into the office two or three days a week. You know, you've got a mixture of working from home and from in the office. So Google is one of those companies. They've got a flexible workweek which calls for employees to spend three days a week in the office and the rest at home. Microsoft has a hybrid workplace, and Ford Motors flexible hybrid work model leaves it up to workers and their managers to decide how much time they come into the office. And there are also a couple of companies taking a bit more of a novel approach. One of those is Stephenson Harwood, which is a London based law firm. They recently said that its employees can work from home full time, but only if they take a 20% pay cut. Would you do that, Sascha? 

Sascha: [00:06:42] Look, I probably take a leaf out of Bryce's book and do a few spreadsheets and work out whether I was saving the money on the commute. I probably would take it their. 

Darcy: [00:06:52] Very calculated. 

Sascha: [00:06:53] Loss. Okay. So, Darcy, I think we can safely say we're in a moment of flux here. It seems like we've got the two extremes. We've got Ellen, of course, always out there with a strong opinion, but then people saying from work, from home forever and then a couple of different fashions in the middle, people trying to a hybrid fashion. I want to take a quick break and then when we come back, let's dig into what we think is going to happen in the future. Which one of these options is going to win the race for? Welcome back to the dive. Before the break, we were talking about the range of responses from different companies about the work from home trend and the different models that they're all trying as we emerge from lockdowns following the pandemic. But Darcy, it's the dive we want to talk about the future. Where do we think this trend is going? What is work going to look like? 

Darcy: [00:07:42] It's a big question and hard to predict, Sascha, but I think there are probably three forces at play here. The first is employees desire for the no commute work from anywhere lifestyle. The second is companies always looking to save a buck. And the third, I'd say, is the changing face of work. 

Sascha: [00:08:00] We love a three point direction here at the dive, so let's start with the first one. Let's talk about employees. 

Audio clip: [00:08:07] If a boss is saying you've got to come back to work, I think the reasonable question is why? Why do I have to do that? 

Darcy: [00:08:13] Sascha, you've heard of the great resignation. 

Sascha: [00:08:16] Absolutely.

Darcy: [00:08:16] People coming out of COVID wanting to leave their jobs, have more freedom. And along with this, we're living through a red hot labour market. So this combination has led to a clear shift in the balance of power between management and employees. The demand for workers has hit record highs in the past year, but at the same time, companies are finding it hard to force their employees to come into work when they fear that they could just walk away. 

Audio clip: [00:08:41] People here are adults. They can make adult decisions, and that means they'll probably make right decisions. 

Darcy: [00:08:47] They'll make an example of this. Apple was planning to bring people back to the office three days a week starting last month. They actually decided to postpone that plan last minute after more than a thousand current and former employees signed an open letter that called the idea inefficient, inflexible and a waste of time. 

Sascha: [00:09:05] Strong words. 

Darcy: [00:09:07] Strong words. They actually wrote, quote, Stop treating us like school kids who need to be told when to be where and what homework to do. Apple eventually relented and gave employees an extra 90 days before the three day await return, but it feels a little bit like a Band-Aid at the moment. Who knows if they'll enforce that then, too? 

Sascha: [00:09:26] That's a definition of kicking the can down the road, isn't it? Let's talk about the second factor. Companies looking to save money, save a buck. 

Darcy: [00:09:33] Of course they are. They're trying to be efficient and make as much money as possible. Adam Schwab, the CEO of travel business Luxury Escapes, said this week If your job can be done from Brighton or Parramatta or Chatswood, it can probably also be done from Bangalore or Johannesburg for a lot cheaper, pretty strong words again. And he went on to say that people working from home are basically task fillers, so why not get the cheapest price?

Sascha: [00:09:59] Man, this topic just brings out some pretty red, a lot of people through all these different buses, doesn't it? I'm going to be careful not to bring this up with Alec and Bryce. All right. So finally, you talking about the changing nature of work?

Darcy: [00:10:13] Yeah, the push to work from home is just one of the broader challenges to our traditional 9 to 5. Just this week, the world's biggest four day workweek trial began about. 

Audio clip: [00:10:23] A four day week all year round from today. Workers at 70 firms across the UK are trialling it with no cut to their pay. 

Darcy: [00:10:30] It's taking place for six months in the UK and with over 3000 workers they're expected to maintain their full capacity from just 80% of their usual working away. The study is meant to measure staff retention satisfaction and their productivity and a similar programme is also going to be run in Australia, New Zealand and the Pacific from August this year. 

Sascha: [00:10:52] Yeah, I was reading about this and apparently it's just this attitude of like if you can get your work done from Monday to Thursday, then you get Friday off. But if you haven't finished your work, you are expected to work. So it's more about just giving that incentive to work harder and smarter. 

Darcy: [00:11:08] Yeah, I'll be interested to say if people end up staying at work later and starting work earlier in those four days but want to keep an eye on. 

Sascha: [00:11:15] Okay. So we tried to broaden this conversation out from Ellen on Tesla, but it also sounds like this is all about the future of work, you know, working from home, but also how long you work, how salaries are calculated. This is a massive conversation, isn't it? 

Darcy: [00:11:30] Darcy It is. Sascha And I think the takeaway is that it really depends on the field you are in or where you work. Some are saying that in-office work limits your potential employees to geographic proximity, so remote work allows you to hire people from a much larger pool. But that in some ways is actually a point against remote work. As Adam Schwab said, if you don't want to come into the office, he'll just hire someone somewhere else to do the job for less. And there's also the argument that employees are more efficient or creative when collaborating at work. But then you can argue people are happier when they have less commute time and it frees up their life outside of work. I can see the value of people coming in to work and collaborating, but I also think that flexibility of working remotely at times is here to stay and hopefully a four day workweek too. 

Sascha: [00:12:18] I don't know how we could possibly fit everything we. Doing Equity Mates into four days a week. But I'm with you. I think trying a four day workweek would be lots of fun just to see whether it works and what it's like. So maybe we'll revisit this conversation in a couple of months time once those trials start in Australia. Thanks so much for joining us for today's edition of The Dive. If there's a story that you want us to talk about, then let us know. Contact us at the dive at Equity Mates dot com or follow us on any of the social media channels. Please give us a rating or review five stars. Please tell us what you'd like us to talk about. Tell us what your favourite episode was. We ask all the time, but it really does make all the difference. Giving us reviews just helps us get in front of other people's ears and always hit that subscribe or follow button so that every time there's a new episode, it's right there in your podcast player. You don't have to go searching for it. Thanks so much for joining me today, Darcy, to talk all about what we do every day.