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Musk forces workers to return to the office, but does this work in tight labour market?

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5 minute read

The Tesla CEO has directed employees to return to the office full time, but experts note this move could be counterproductive in a tight labour market. 

Elon Musk wants to put a stop to remote work at Tesla, directing all employees to either head back into the office or leave the electric carmaker.

In two emails sent to staff earlier this week, including one with the subject line ‘Remote work is no longer acceptable’, Mr Musk said that every Tesla worker now needed to be in the office for at least 40 hours per week. 

“The office must be where your actual colleagues are located, not some remote pseudo office. If you don’t show up, we will assume you have resigned,” he warned.

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According to Mr Musk’s directive, those with greater seniority at Tesla will be required to demonstrate an even stronger presence in the office.

“That is why I lived in the factory so much – so that those on the line could see me working alongside them. If I had not done that, Tesla would long ago have gone bankrupt,” he said.

The policy is in stark contrast to that taken by social media giant Twitter, the target of a US$44 billion takeover by Mr Musk which is currently on hold.

Twitter has repeatedly claimed that it would allow its employees to work from home “forever” even as the company began reopening all of its offices worldwide earlier this year.

“As we open back up, our approach remains the same,” Twitter CEO Parag Agrawal said in an email to staff in March.

“Wherever you feel most productive and creative is where you will work and that includes working from home full-time forever.”

Mr Agrawal said that most Twitter employees had indicated a preference for some combination of working from home and working at the office.

“We’re now at a stage where you’re living your lives, adjusting to local health guidelines, and deciding what works best for you,” he said.

“So too, the decisions about where you work, whether you feel safe travelling for business, and what events you attend, should be yours.”

Hybrid approach most popular

Locally, the CEO of the Australian HR Institute, Sarah McCann-Bartlett, told InvestorDaily that most organisations are taking a hybrid approach.

“While many organisations are asking employees to come into the office two or three days a week, others are looking at implementing hybrid models based around different types of work or activities,” she said.

“For example, data entry or report writing might be done most productively from home, while team building and strategic planning might be best done face-to-face.”

According to Ms McCann-Bartlett, most Australian organisations are trying to strike the right balance between what works best for their business and for their employees.

“This means considering recruitment and retention in a tight employment market, ensuring the workplace is diverse and inclusive, and being able to deliver effectively,” said Ms McCann-Bartlett.

“Some organisations and their leaders are finding the switch from COVID’s fully remote model of working to a hybrid model difficult. This is not surprising given that it's new and that it requires a different set of management skills, new technologies and new ways of working.”

During the first quarter of this year, NAB found that Australians were spending 38 per cent of their work week at home but ideally wanted to be spending 49 per cent.

Commute time was seen as the biggest barrier to returning to the office according to 40 per cent of workers, and around one in four said they would be extremely likely to consider changing jobs if it meant a reduction in travel time.

Other major barriers to returning included a fear of catching COVID-19 or transmitting it to others (33 per cent), traffic congestion (31 per cent) and loss of flexibility for exercise and other activities (30 per cent).

“Flexible working has become considerably more important in attracting and retaining talent as many employees have grown accustomed to less traditional work hours,” NAB said.

“Some businesses may require a more compelling employee proposition to prevent costly and time-consuming people movement. With the labour market expected to remain tight, the relationship between the employee and employer is now much less one-sided.”

Jon Bragg

Jon Bragg

Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.