WSJ Your Money Briefing - They Refused to Go Back to the Office, Now They’re Out of a Job

Episode Date: December 17, 2024

After years of lax enforcement, more companies are cracking down on return-to-office mandates. Wall Street Journal “On the Clock” columnist Callum Borchers joins host J.R. Whalen to discuss the shift toward stricter policies and what it means for workers.  Sign up for the WSJ's free Markets A.M. newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

Amazon Q Business is the generative AI assistant from AWS because business can be slow like wading through mud But Amazon Q helps streamline work so tasks like summarizing monthly results can be done in no time Learn what Amazon Q Business can do for you at AWS.com slash learn more Here's your money briefing for Tuesday, December 17th, I'm JR Whalen for The Wall Street Journal Here's your Money Briefing for Tuesday, December 17th. I'm JR Whalen for The Wall Street Journal. After several years of lax enforcement, companies are getting strict about employees returning to the office.

What we're seeing more often right now is companies saying, this is the required number of days. And if you are not willing to meet that, either because you've relocated or you just don't feel like you can meet the requirement even if you're local, we'll offer you some kind of buyout severance package. We'll talk to WSJ On The Clock columnist Callum Borschers after the break. Investing in sports, a four-part series from exchanges, the Goldman Sachs podcast, informed perspectives on the ever-evolving business of sports and the expanding investment ecosystem

with leaders at the forefront of the industry. For the sharpest analysis on franchise ownership, media rights, the growing women's sports market, and more. Investing in sports from Goldman Sachs Exchanges. Listen now. Listen now. More companies are telling workers the days of work from home and hybrid work schedules are over. Wall Street Journal columnist Callum Borshers joins me. Callum, does this mean the pendulum of power is now firmly on the side of companies? Well, bosses seem to think so.

It's funny, I had a conversation with Dan Kaplan, who's a senior client partner at the consulting firm, Corrin Ferry. And he said, yeah, I mean, behind closed doors, what he hears from CEOs is, I'm tired of the whining about having to go back to the office. We've compromised enough for years. And look, we think that we have the ability

to go out and replace talent that we lose. So if you're not willing to come in the minimum number of days, then we're just gonna move on without you. How are companies telling workers they have to be in the office in order to keep their jobs? So there's a few different approaches. There don't seem to be a lot of instances of companies just outright firing workers for not coming in the required number of days, although it may come to that in the new year. In fact, Dan Kaplan at Corn Ferry predicts a bloodbath in 2025. So we'll see if that comes to fruition. But what we're seeing more often right now is companies saying,

this is the required number of days. And if you're not willing to meet that either because you've relocated and so you're not in commuting distance anymore, or you just don't feel like you can meet the requirement, even if you're local, we'll offer you some kind of buyout severance package. Do employees have any legal rights if this is the reason they lose their job? On a surface level, the answer is no, because remote worker is not a protected class in the same way that being a person of color or a woman or somebody of a certain age or a person with a disability, it's not that kind of category. But I've talked about this with labor attorneys who say,

there is overlap though, between remote workers and some of those protected classes. In other words, you couldn't have a grievance because you were a remote worker, but they're possible. This hasn't been tested yet, but they forecast there could be some kind of legal test. It would have to be a lawsuit that said, mass layoff of remote workers was targeting people of color or targeting women

or targeting people with disabilities, who we do know from survey data disproportionately favor remote and hybrid work arrangements. So this is a question that hasn't totally been settled yet. You spoke to several people who lost their jobs over return to office rules, and they told you that wasn't even the worst part of it.

What do they say about that? Jobs come and go. So, I mean, a layoff is always lousy, but what't even the worst part of it. What do they say about that? Jobs come and go. So, I mean, a layoff is always lousy, but what they say the worst part is looking to the future. It's sort of coming to the realization that I may never get that back. The remote or hybrid arrangement that I have so enjoyed that in some cases I've built my life

or my family life around, that may be gone for good. And that's a really hard thing to come to terms with. I'm thinking of an attorney named Stephanie Pittman, who I spoke with. She lives in Kansas and had been working for the past year and a half or so for a company that was based in California. And she says, look, I've got four children. I've got elderly parents who live just a mile down the road. I'm a big part of their care team.

My husband is a judge here in Kansas. And so he really can't go anywhere. And so I'm really anch part of their care team. My husband is a judge here in Kansas and so he really can't go anywhere. And so I'm really anchored to this place. And she was making good money working for this California company. And now, a month after her layoff, she said, I've already applied to a hundred jobs. I'm getting very little traction.

And it's really frustrating and discouraging to think about whether I'll be able to get that kind of set up again. Did you speak to some workers who have a financial plan B in place if they are fired for this reason? Some companies are offering severance packages to workers who are unwilling to comply. So some will say, all right, well, I'm going to get, let's just say, three months of severance, so that'll be enough to tide me over till I find another job. There are also folks, of course, who socked away cash during the post-pandemic boom,

and so they feel like they can afford to be out of work for a little while. But sometimes the runway doesn't go as long as you would hope. I spoke with a man named Nathan Vance who lives in Washington state. And he's one of those folks who took a buyout offer to leave Grindr, which had said, we want you all back in offices.

And he said, well, I'm 800 miles from the nearest office in San Francisco. That's not happening. And so he figured that between unemployment benefits and the severance package that he'd be okay. But here he is now, eight months on, and he hasn't landed a new job yet. And so he says now he's dipping into personal savings,

into the retirement fund. He figures he's got a couple of months of runway left. So he had a plan B. He thought that it made good sense, but the job market in his case has proven to be difficult. What does this balance of power look like in the years to come? What we're looking at in 2025

is a really interesting dynamic where you see optimism about the economy. Not that it's been terrible for the last year or so, but you've seen the sort of pessimism. And just in the last month, consumer confidence has ticked back up. And that can weigh into people's calculations as well. Human beings don't always behave rationally,

JR as we know. So you can tell them, okay, look, it's a tough job market. If you don't comply with this RTO mandate, you might have a hard time finding another job. But Dan Kaplan at Corn Fairy thinks that you're getting a lot of workers who are going to dig in anyway, even if it doesn't seem rational from the outside. And they're going to say, I'm betting on myself, I think I will find another arrangement out there either because the job market's going to heat back up and I'm going to have more leverage to negotiate a flexible arrangement. And listen, they're not entirely off base. Ladders, which is the job board for six-figure opportunities, has said that they're already seeing this a little bit. If you look at the highest paying jobs that pay $250,000 or more, in the third quarter

of this year, they found that 10.4% of those were remote opportunities. And that was up from 8.8% in the second quarter. So not a huge spike, but an increase there. And so they take that as a sign that maybe some of these highly skilled, highly compensated workers are in fact beginning to claw back a little bit of leverage. That's WSJ columnist Callum Borschers. And that's it for your Money Briefing. This episode was produced by Ariana Osborne with supervising producer Melanie Roy. I'm JR Whelan for The Wall Street Journal. Thanks for listening. This podcast is brought to you by CME Group, the world's leading derivatives marketplace, offering the widest range of global benchmark products across all major asset classes.

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