UK could save £32bn through telework
Employers in the UK are lagging behind their European counterparts and are missing out on savings that could amount to £32bn, according to the Telework Research Network.
With just 4.9% of the employed labour force working from home two days or more, the UK ranks 12th among EU nations. Leaving aside the management and motivational benefits, telework could save employers £3,000 per year per employee working from home for two days a week.
• Talk about productivity - show your manager or CEO what the savings could mean for recruitment, retention and productivity.
• Identify the company’s current “hot points” - for example property costs or staff turnover - and prioritise those points in your case.
• Don’t just send people home and expect them to excel. Put appropriate management in place and train staff on policies, expectations and security issues.
• Do a pilot, start with a smaller group and work out form there.
Source: Telework Research Network
These findings are drawn from ‘The Shifting Nature of Work in the UK–Bottom Line Benefits of Telework’, (165kb PDF) a recent study conducted by Telework Research Network founders Kate Lister and Tom Harnish, which they presented in a webinar with TrainingZone.co.uk.
Shifting workers from the office to home reduces commuting time and driving costs. Employees can save money on food and clothes as well as costs for caring for young or old relatives. Telework also allows people to live in cheaper areas.
“Companies that have integrated telework as a strategy have found it is good for business, good for employees, good for the environment, and good for the economy,” the authors concluded. “The benefits far outweigh the costs.”
Based on five years’ research, the authors claimed a team of 100 employees working two days a week could save employers £320,000 a year, adding up to £32bn potential savings for UK business.
The Telework Research Network cost comparison model is made up of 59 variables including the following elements, with their estimated savings potential:
- Productivity: typically shows a 20% increase on home working days - total potential savings: £15.3bn
- Property and utility costs: 15% reduction in office space requirement if employees work at home two days a week and 4,400kWh less energy use per person per year - total potential savings: £4.2bn
- Absenteeism: Average reduction of 4.7 days a year - total potential savings: £3.2bn
- Employee retention: 7% average reduction in attrition - total potential savings: £287m
- Employee travel savings: £267 average savings per person per year - total potential savings: £1.3bn
- Annual savings in other work expenses (parking, food, clothing) - total potential savings £6.1bn (mid-level estimate)
- Reduced costs as a result of fewer traffic accidents - total potential savings £1.4bn
- Plus Reductions in community oil usage and greenhouse gas emissions.
Yet the feedback from participants in the 19 May webinar showed that 47% thought management issues were holding back telework within their organisations; a similar number blamed corporate intertia.
Lister and Harnesh acknowledged these issues. “There’s a concession culture of thinking about fexibilty rather than its benefits. Managers are sending mixed messages about workshifting,” said Harnish.
“You don’t just send people home and expect them to excel. It’s different to an office. You’ve got to do training on security, expectations, availability and how to use suitable tools like [webinar sponsor] GoToMeeting.”
A formal telework policy was essential to overcome the perception that some people are being favoured by being allowed to work from home, he continued: “Until 3-4 years ago, most telework was ad hoc - it was generally senior people, who viewed it as a perk. Now companies are adopting flexible work and home working as a corporate strategy, because it makes good financial sense. If you don’t have a policy about who can do it, then people will play up.”
Remote working demands a more results-based management approach, which leaves no place for shirkers to hide. In return, people working from home need to be disciplined and self-reliant to deliver the expected benefits.
On other possible blocks, Harnish noted that “out of sight, out of mind” teleworks sometimes worry about being passed over for promotion. “If they’re being managed by who produces results, it shouldn’t be a problem,” he noted.
Harnish and Lister are often asked about the legal implications, for example employees blaming and claiming from employers for any domestic accidents. After polling many of the major organisations the Telework Research Network has worked with during the past five years, Harnish said the number of actions it has uncovered was: “None. If people are working at home, they’re not going to mess it up with a law suit,” he said.
A playback version of the telework seminar is available on the GoToMeeting website.