Future shock

As companies across Virginia continue to adjust to workplace changes created by the COVID-19 pandemic, many human resources managers say one thing is clear: The way people work has changed for good.

“This is a new work environment — the workplace has changed now,” says Kirstin Shelton, vice president of human resources for Octo Consulting Group, a Reston-based technology company that has about 85% of its workforce on a hybrid work model, with employees alternating some days in the office and some days remotely.

“I think the hybrid model is how things are going to continue going forward,” Shelton
says. “It definitely impacts what we are doing in recruiting. We have seen a shift because of the opportunity a remote workforce allows.”

In a post-COVID workplace, she adds, “employers have really got to be creative on how people do their work. It is no longer about people coming into the office from 8 a.m. to 5 p.m. and sitting at their desk. People are coming in [to the office] for collaboration. They are coming in to connect.”

Nevertheless, for any employer or supervisor, the primary complication with remote and hybrid work remains staff engagement, Shelton says. “When you are no longer physically co-located with your team five days a week for eight to 10 hours, there is just the general lack of being able to read someone’s body language. You have got to be creative and make sure you are connecting with your staff. That is our biggest challenge: ensuring that managers spend time and have the tools they need.”

Finding the right balance between remote and in-office work is a key opportunity for businesses if they want to remain competitive in recruiting, HR managers say.

“The reality is there is a portion of the workforce that simply prefers to be remote,” says Clare Miller, chief human resources officer for Richmond-based Atlantic Union Bank, which has about 2,000 employees in Virginia. “How do you strike a balance between flexibility where it makes sense, while also accounting for the business needs and strategy of an organization?”

Thinking ahead

In April, Atlantic Union announced it was moving to a hybrid work model, in which most of its corporate staff would be alternating between two or three days a week in the office and two or three days of remote work.

Miller says about half of the company’s employees are now working a hybrid work schedule, while about 15% are fully remote and about 33% work in the office full time.

Amid an ongoing labor crunch, companies that offer flexible work schedules have an advantage in recruiting, Miller and other HR managers say. “The current environment is competitive for talent,” Miller says. “I think flexibility is just another lever we can employ.”

Offering hybrid or remote work “has become a bit of a competitive advantage from a recruiting perspective,” says Michelle Link, chief human resources officer for Maximus Inc., a government contractor with more than 34,000 employees spread across all 50 states, including 5,000 in Virginia.

About half of the company’s employees at a call center in Chester are working remotely, and almost all its employees who worked at a call center in Hampton continue to work remotely. The company also consolidated the two administrative offices it once had in Falls Church and Reston into a single corporate headquarters in Tysons, which reduced its headquarters office footprint from 130,000 square feet to about 90,000 square feet. Employees at the company’s headquarters work a hybrid schedule.

“We are not seeing a slip in our productivity” because of the shift to increased remote or hybrid work, Link says. “Our customers are happy, and we are going to do this for the future.”

The transition has pushed Maximus’ managers to think more about managing for outcomes than managing for time, she adds. “What you want is to manage … what people produce,” Link says. “You don’t want to be focused on when they come and when they go — you want to be focused on delivery.” 

The company is also seeing that jobs requiring an in-office presence require extra salary inducements.

“Right now, you need to pay a 10% premium if you want people to be on site and if you are recruiting IT or technical talent, it can be higher than that,” Link says. “Why would they come to work for you on site if they can do the same job somewhere else in a hybrid environment?”

‘Rapidly changing’

With more people working remotely, some companies have decided to scale back on office space while others are taking a wait-and-see approach about office needs.

Atlantic Union, for instance, relocated employees from an office in Caroline County to other locations.

“That change was prompted by our move to a flexible work environment,” Miller said. “We have not yet planned to consolidate any other corporate offices at this time but that is something we will continue to monitor. It is a rapidly changing environment.”

HR professionals need to consider many challenges that employees face in returning to the office for work after two years of remote or flexible work, says Linda Fisher Thornton, an adjunct associate professor at the University of Richmond’s School of Professional and Continuing Studies.

For example, many workers cared for children at home during the pandemic, and people who are required to come back to the office may not have access to affordable or reliable child care, Thornton says.

Additionally, “many people have enjoyed working in their sweatpants or enjoyed working casually, such as out in their backyards, and that is a lot to give up if they go back to working part of the time in the office,” Thornton says.

Thornton also notes that the cost of commuting is an issue because gasoline prices have ballooned, climbing to nearly $5 per gallon in June. Grocery prices also are up, so “resuming the commute back to the office — even part time — leaves employees with a higher added cost as compared to their pre-pandemic commute, representing a higher percentage of an already tighter budget.”

Thornton says remote work has been “a win for employees, improving their quality of life, removing child care barriers and eliminating commuting expenses and time.”

Employers have seen some financial wins from shifting to remote or hybrid work, such as reducing costs for office maintenance and associated overhead. But those that haven’t adjusted for office footprints are facing pressures “not as visible to employees,” Thornton says. Those include “the cost of maintaining empty buildings and campuses,” as well as “the challenges businesses face in building cohesive remote teams, the difficulty retaining good employees with none of the usual on-site perks available, and more.”

Thornton says there is clearly an opportunity for businesses to consolidate office space after switching to hybrid work, but companies should make sure to consider how it will impact workers.

“Employers who make sweeping decisions without considering individual situations will send a message to employees that ‘our needs are more important than yours,’ a message they cannot afford to send during a talent exodus,” Thornton says.

The bottom line, she says, is that “businesses that are not flexible about remote work will be at a disadvantage in recruiting and retaining top talent, because employees enjoy the improved quality of life that remote work affords, and desirable remote job options will exist elsewhere,” Thornton says.

Retention fears

For some companies, the transition to hybrid work came naturally because they were already moving in that direction. For instance, Stride Inc., an education technology company based in Herndon, already had about 85% of its staff working remotely before the COVID-19 pandemic. It ranked No. 6 on FlexJobs’ list of the top companies in the nation hiring for hybrid jobs in 2022.

“We actually saw productivity go up when we went fully virtual,” says Val Maddy, senior vice president of human resources for Stride. With a corporate staff of about 500 people, Stride is downsizing its headquarters office space from 130,000 square feet to about 30,000 square feet.

“I think it is really all about making sure you keep a connection with employees,” Maddy says. “We have instituted more virtual events for individuals to participate in. We do virtual yoga and meditation and high-intensity interval training exercise classes.  We do that to promote camaraderie, but also mental and physical wellness.”

While private sector companies grapple with the transition to a more remote work environment, Virginia’s state government employees are dealing with a mandate that they return to office work.

In May, Gov. Glenn Youngkin announced a policy that required state employees to return to in-person office work five days a week by July 5 unless they receive approval for a “telework agreement.” Getting such approval isn’t exactly an easy task — an agency head must approve a worker telecommuting one day a week; teleworking two days a week requires approval from a Cabinet secretary; and telecommuting three days a week or more can only be approved by the governor’s chief of staff.

The policy shift was upsetting for many state employees who have benefited from being able to work from home, says Dylan Bishop, a lobbyist for the Virginia Governmental Employees Association, which unsuccessfully sought an extension until September on the return to office work. 

“There were hard and fast deadlines set in place that we were concerned about,” Bishop says, adding that state employees had only two weeks to submit applications to continue at-home work. “We have 122,000 state employees, so to give these folks a two-week turnaround time to submit telework agreements … we were skeptical of that.”

Bishop says a survey of the association’s members, which garnered 400 responses, found that more than 50% were concerned about the rising cost of commuting to work because of gasoline prices.

Another issue cited as a top concern among about 25% of survey respondents was “child care and elder care,” Bishop says. “It takes two to three months to find placement for a child in day care under the best of circumstances, and that problem became more acute in the shadow of COVID.”

While the state workers’ association recognizes that many state jobs, such as law enforcement and corrections, cannot be performed remotely, Bishop contends that mandating in-office work for white collar jobs such as information technology will hurt worker recruiting and retention for state government jobs.

“We have longstanding recruitment and retention issues in state employment, particularly in high-skilled and high turnover positions — that is IT, health care and public safety,” he says. “The No. 1 reason attributed to issues with recruitment and retention is compensation. The average state employee’s compensation lags the market by about 10%.”

This issue predated the pandemic, Bishop says, and flexible work options are one way that the state government could compensate for its inability to compete with private sector wages.

Telework and hybrid work, Bishop says, would make “state employment more appealing and [make] it easier to keep people in the commonwealth.” 

Read more about in-person returns in Virginia offices.