Warnings for those considering to take a pay cut to work from home permanently

Gary Butterfield, Co-founder and Executive Director – Juice Limited

An employee wellbeing expert has warned of the potential pitfalls and health risks of taking a pay cut to permanently work from home. As the UK plunged into a third national lockdown, Gurged employees not to make a salary sacrifice that may cost them dear.

Mr Butterfield was responding to a survey which found that three-quarters of employees said they would accept a significant pay cut if it meant they could continue to work from home.

The survey by cloud technology company Citrix found that 75% were ready to give up an average of 14% of their annual salary for the privilege of staying home and avoiding the daily commute.

During the first lockdown back in March employees were told to work from home if they could – and many have yet to return to the office.

Data from the Office for National Statistics found that by mid-September – when restrictions had eased – 36% of employees had yet to go back to their regular place of work, suggesting employers and their employees were enjoying the benefits of homeworking.

However, Mr Butterfield warned that the novelty – and perceived savings – may disappear and said: “While we may be 10 months into the pandemic, people’s lives have been in a constant state of flux and now is not the time to make rash decisions about our incomes.

“Working from home is necessary in this time of crisis but we could be storing up problems for the future. Isolation and loneliness have been on the rise for years, and we haven’t yet seen the true impact that the pandemic will have on mental health and organisational inclusion.

“It may be a case of ‘so far so good’ but that doesn’t mean it’s right for the long-term.”

If employees give up 14% of their salary that could amount to £4,266 on the UK average salary of £30,472. In fact, older employees, those in the 45-54 age group, would sacrifice 16% of their pay, according to the Citrix survey.

Mr Butterfield said: “The financial savings of homeworking and the time gained from not commuting may seem attractive at first, but the costs are likely to be outweighed by the need for superfast broadband and higher utility bills at home.

“Since the start of the pandemic people have been happy to make do and mend when it comes to kitchen table or back bedroom offices but if homeworking becomes permanent then separate office space will be needed along with higher quality furniture and equipment, and I doubt employers will foot the bill for everything.”

Mr Butterfield added: “It doesn’t surprise me that older employees said they would be willing to take this pay cut because they’re more likely to have savings in place and live in larger accommodation. You could argue that this is age discrimination to those earlier in their career journey.

“As for wellbeing, placing these financial requirements onto employees and then giving them a pay cut is obviously going to have an effect not only on their mental and physical health, but damage the organisation’s bottom line too.

“As a result, engagement and productivity will most likely decrease, with isolation and loneliness increasing ever further. This is the last thing we need after successive lockdowns.

“Last summer, even when Covid levels were down and restrictions eased, many companies seemed reluctant to get employees back in the office when they could have invested in Covid-safe measures to make that possible.

“Personally I’m a big advocate of the office, but could this just be a way for companies with outdated ways of working to force the hand of employees who want but can’t afford to take this pay cut, and effectively force them to forgo the privilege of working from home?”

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