We've all been there. You’re planning your week and you have the best intentions of getting into the office more often. But, then you start doing the mental math:
- The commute is a couple hours out of your day
- It costs you a bunch of money out of your own pocket to go into the office
- Half of your team is remote and will be on video calls anyway
- Inertia is a hard thing to overcome.
So, you decide to work from home and put off going to the office again. Meanwhile offices sit empty, company culture erodes, and managers are increasingly left wondering if they need to put a mandate in place to increase office attendance.
While employers can’t do much about the length of someone’s commute or the cost of pet sitting, the cost of commuting is a real barrier to office attendance for most employees. And what’s amazing is that most companies aren’t doing anything to address the cost differences between in-person and remote work.
Remote work has fixed, one time costs, while in-person work has variable costs that occur every day someone attends an office. At Robin we embarked on a mission to solve this discrepancy, and we learned a lot.
Examining Office Commuter Benefits
While pre-tax commuter benefits are nothing new, they haven't really been evaluated since the way we worked changed.
Typically, organizations would offer pre-tax payroll deductions to account for public transportation costs or parking costs as part of their commuter benefit programs. These passes generally used pre tax dollars to cover the cost of a monthly or weekly pass.
What Does the Employee Commute Look Like Now?
The commute changed a lot thanks to the pandemic. For the most part, most hybrid employees are not commuting 5 days a week, instead they are splitting their weeks between in-office time and at home work. So just how big of a barrier does the commute present for employees? Our friends at JLL recently looked into just that.
Turns out, commuting time (59%) and cost (43%) are the biggest factors preventing employees from working in the office. Other reasons include office timing conflicts (31%), noise levels (28%) and no flexibility in scheduling (24%).
With more flexible schedules, employees aren't coming in five days a week anymore. As such, organizations that offer commuter benefits designed around a 5 day work week should consider how to tailor their programming to match the reality of modern work-week schedules.
Commuting time (59%) and cost (43%) are the biggest factors preventing employees from working in the office
Robin's Commuter Benefits: Introducing Daily Stipends
At Robin, we run on a hybrid working schedule. In 2023, like many downtown offices, we were trying to find ways to make it easier for people to work together in-person more often.
So, we asked ourselves: how can we better encourage our teams to come into the office by addressing one of the root causes for people staying at home?
We centered our plan around commuter benefits. We scrapped our old commuter benefit program which subsidized monthly commuter passes and we switched to a daily commuter benefit which covered the full cost of an employee's commute on a daily basis, with a monthly cap.
By switching to a daily commuter benefit program we were able to address the variable cost that employees incur when they commute to the office on a hybrid schedule.
Then, to double down on the initiative, we also began to:
- Regularly hosting office activities for teams and cross-functional departments
- Reporting on progress publicly with regular updates in company town halls
The Results: A 40% Increase in Attendance
The metric we cared about most was: what percentage of hybrid Robinauts attend the office at least weekly?
The results were considerable:
- Before: 48% of hybrid employees were going to the office weekly.
- After: 68% of hybrid employees were going to the office weekly.
That’s a 40% increase in attendance without a company mandate or requirement So what did we learn?
1. It’s important to start by understanding the barriers between your people and the office, then work your way to a solution.
2. Flexibility matters to people. Give your teams a say in the solution
3. Show your company the progress and reinforce what’s important.
Reimagining Commuter Benefits
Now, what if we took this one step further? We know that the commute isn't the only thing affecting people's pockets. So what else is there to consider?
The Cost of City Days
In fact, the 2023 State of Hybrid Work report, conducted by video-conferencing company Owl Labs, found that employees nationwide spend $51 per day when they work in person. On average, people spend:
- $16 on lunch
- $14 on commuting
- $13 on breakfast and coffee
- $8 on parking
What's more? Workers with pets spent $20 more than their counterparts, bringing their daily total to $71. Employees who report to the office five days a week spend about $1,020 every month on average. In comparison, workers who have a hybrid schedule spend $408 a month on office attendance costs, the study found.
Location-based compensation in a hybrid world
There's been plenty of debate around how to deal with compensation in a world full of remote workers. As people moved out of cities to take advantage of lower costs of living, leaders were stuck wondering how to handle salaries.
If a Boston-based employee moved to Columbus, Ohio to enjoy a cheaper lifestyle then should their compensation reflect where they were hired or where they are living?
According to a 2022-2023 Salary & Incentive Survey by business management consultancy, BalancedComp, more than half (51%) of companies adjusted remote employees’ pay after they moved to a different market. But that still leaves 49% of organizations that did not.
Pay-to-Play: Compensation for In-Office Visits
When you consider the cost of office days and the overall discussion around compensation for local employees vs. remote team members, you start to wonder: should employers be paying for more than just a commuter pass?
Perhaps, companies should begin to compensate employees for more than just the cost of their commute. Will the future benefit for people include more of a stipend to cover things like lunch in the city or your late afternoon coffee run?
What's Next at Robin?
We continue to look deeply into the drivers of hybrid work and how we can adapt employee benefits to better fit the new world of work. Additionally, we are always looking for ways to automate the administration of these programs on our platform, which is what we did with our daily commuter benefit.
As we explore new benefits to engage teams, we will continue to consider what barriers stand in the way of employees coming into the office. The more we can reduce friction in our workplaces, the more we can build working spaces that support collaboration, community and connection.