A third of employees would take a pay cut to work fully remotely: What would encourage a return to office?

After a period of primarily remote work or hybrid arrangements, many companies want employees to now work on-site more often, if not full-time. What are businesses doing to encourage this return to the office, and how can they support staff morale?

Mandatory return to office policies are appearing globally, requiring employees to get back to working on-site full-time or for at least a few days a week. Employees may have become accustomed to remote working, making it difficult to return to working fully in person. This is especially relevant as Australia's general cost of living is high and some individuals may worry about work-related expenses, such as commuting or childcare costs, or jeopardising flexible work schedules.

Capterra's first article in this two-part series examined the general cost of living and expenditures employees face working remotely or on-site. In this article, we explore the current working arrangements for Australian companies, whether employees prefer to work from home or in the office, and which incentives or benefits companies could offer to increase employee engagement and encourage staff to be on-site more often.

We surveyed 2,716 employees from 11 countries globally, 248 of which are from Australia. Where relevant, we will compare the Australian results with the global averages. The full methodology is at the bottom of the page.

Nearly half of Australians work entirely on-site, but over a third would prefer to work fully remotely

Capterra’s 2024 Cost of Work survey finds that 46% of Australians work fully on-site at their company, 41% follow a hybrid arrangement, and only 10% work entirely remotely. This puts Australians in line with the global average of employees who work fully on-site at their workplace (45%).

However, when asked where they would prefer to work if given the choice, hybrid work arrangements remain a preference for the majority of Australians (51%). It is worth noting that over a third of employees (35%) would like to work entirely remotely, suggesting that companies need to evaluate office engagement and try to understand why these employees aren’t interested in coming back to the office.

Various factors contribute to employees wanting to work fully remotely, such as eliminating the daily commute and saving money on expenses, including work attire and lunches. Workers may also find their home setup more comfortable than their on-site office space. 

Most Australians who work remotely or hybrid (63%) said their current remote environment (or home office) fully meets their needs and preferences. Employees can customise their workspaces to suit their workflows and aid their comfort levels. Therefore, companies wishing to attract employees back to the office can consider creating an inviting on-site work environment that appeals to employees and prioritises their comfort and productivity.

A third of employees would take a pay cut to work remotely 

Remote work has many benefits for employees and improving work-life balance is the primary reason Australians say they would prefer to work remotely (49%), even for at least some of the time. This was followed by being able to save time (16%) and save money (12%).

Remote work often allows employees to have more control over their schedules and the flexibility enables them to manage work duties alongside their personal responsibilities, such as childcare and pursuing personal interests.

Capterra asked survey takers whether they would consider taking a pay cut to work remotely, and found Australian respondents placed slightly higher (68%) than the global average of 64% in saying they would not.

Whilst the majority were not interested in the idea, it is worth noting that a third of respondents (34%) said they would: 

• Take a pay cut up to 5% (17%)
• Take a pay cut up to 10% (13%)
• Take a pay cut up to 20% (2%)
• Take a pay cut up to or more than 25% (2%)

While a pay cut may not sound favourable to some, the benefits of remote work can make it a worthwhile trade-off for other employees. Some may find improved work-life balance and geographical flexibility significant factors that contribute to their willingness to accept reduced pay to maintain a remote work lifestyle. For others, the idea of a pay cut in order to remote work may result in them working on-site more often.

Despite the financial and operational benefits of asking remote employees to take a pay cut, potential factors, such as the impact on employee morale, retention, and the company's reputation, must be carefully considered. If employees were to take a pay cut, then additional perks, such as more paid time off (PTO) or wellness programs, could compensate for doing so.

Top employer benefits that would help individuals enjoy working on-site more 

Encouraging employees to work on-site more often by offering incentives and perks helps address many of the potential challenges businesses associate with remote work, such as communication gaps, reduced collaboration, and the potential for decreased engagement. 

Capterra asked employees who work in the office at least some of the time if they would enjoy working on-site more, less, or about the same if their employer offered certain benefits. The top benefits that would contribute to employees enjoying working on-site more often include free or subsidised food (81%), flexible work schedules (73%) and commuter benefits, such as parking and transport reimbursement (69%).

Key points to consider for a return to office strategy

Whether companies expect employees to work on-site full-time or for a few days a week, creating a comprehensive return to office strategy is crucial to ensure a smooth transition and maintain employee satisfaction. Consider the following points:

• Share a clear communication plan: Explain the reasons for returning to the office and the benefits for both the company and employees. Provide regular updates via multiple channels, such as the intranet, emails, and meetings.
• Keep flexible work schedules: Regardless of whether employees can continue to utilise hybrid work arrangements or not, allow them to have flexible working hours when returning to the office to accommodate different needs.
• Implement employee well-being programs: As part of an employee benefit, offer resources such as stress management programs or provide on-site fitness facilities or local gym discounts, to increase engagement and office attendance. 
• Offer professional development opportunities: On-site training sessions, workshops and career development programs can encourage employees to return to the office. Facilitate in-person mentorship and networking opportunities to enhance career growth.

Even though 87% of Australian survey takers currently work on-site at least some of the time, it's still crucial to address the needs and concerns of returning to the office for the small number of employees who primarily work remotely.

Listening to employee feedback can help companies recognise what would work best, whether it means encouraging a full return to the office or allowing employees to work entirely remotely if they are willing to accept a pay cut supported by additional benefits. Keeping a hybrid schedule is one way to strike a balance and accommodate both the needs of the employer and the employee.

If implementing a return to office, companies should work on creating a positive work environment that encourages fully remote employees, or those who do not go to the office very often, to return to working on-site while maintaining their well-being and satisfaction.