RTO or risk: Are return-to-office mandates harming company culture?

Return-to-office (RTO) mandates have stirred frustration among workers, with many employees threatening to leave their roles over being called back in. But why do CEOs and leadership teams continue pushing these mandates despite the resistance? From culture-building to talent retention, executives argue that face-to-face interaction strengthens their organizations in ways that remote work can’t. But the question remains: are these mandates really beneficial for company culture, or do they risk driving out the very talent companies aim to keep?

RTO mandates are not just about productivity, but about diversity and inclusion, company culture, and communication. HR executive George A Murphy shares his thoughts on why CEOs are driving RTO mandates forward, and why they’re probably sacrificing talent to do so.

What are RTO mandates trying to achieve?

When companies announce a blanket RTO policy, one would assume they aren’t doing so simply to try and control or annoy their employees. Murphy believes it’s a very shortsighted approach to attrition if that’s the underlying reason for the decision. So why might CEOs want their employees back in the office? He shares one quote a former CEO of Caterpillar once shared with him: “Unless you’re managing culture you’re going to get the culture you don’t want.” Murphy believes managing company culture is much harder in a remote setting and part of the drive is because it is so lacking.

As an example, he shares a story from his time working in mergers and acquisitions. “When we looked at a business, we knew how well they were run and to some degree how profitable they were by where everything was located. So if you went in to look at a Biotech [firm] and if it was all in one building and on one floor, they were generally running better, faster, more effectively, and more productively. If they were on two different floors they lost a little bit [of efficiency and productivity]. If they were in separate buildings they could be really different.” Organizationally, having everyone under one roof at least part of the time would seem to be of benefit in his experience. Messages and culture are easier to maintain and much less gets lost in communication.

Online communication is different

Murphy believes that you simply don’t get the same type of communication from behind a screen—and he’s not alone. A study by the Journal of Experimental Psychology showed that people perceive others as more authentic and genuine in person, but are generally less persuasive than they think they are over email. Conversation can be more stilted over a screen—we miss out on all the non-verbal cues we don’t even realize we are absorbing in person and it’s much easier to hide the fact that you aren’t really paying attention online, especially when many people are present. A survey by the Harvard Business Review shows that 95% of people interviewed believed in-person meetings to be key to both successful long-term relationships and building strong relationships. A further study showed that face-to-face interactions substantially increase the flow of knowledge.

It’s not just about planned meetings either; Murphy quotes a previous manager he worked with who said, “I can’t walk down the halls and see how everybody’s feeling. Connection has to be scheduled.” This manager wanted Murphy in the office because if something came up that he wanted to sound him out about, he could easily just walk down the office and strike up a conversation. You could of course argue that picking up a phone or sending a Slack message would achieve the same goal, but it’s harder to get the timing right, to know if the person you want to chat to isn’t in the middle of something, that they aren’t irritated by the interruption.

In addition, with remote work you don’t always have easy access to people at all levels of the company—for example, the chance to sit in on a higher-level meeting you’re not actually part of just to see how things work. Murphy sees this as a real disadvantage for people who stay fully remote when others are returning to work. “I think employers have to be really upfront and say that if you want to be fully remote you need to understand that it could come at some career advancement costs because you’re not getting the exposure to all the people that you need to help advance your career. People seem unwilling to be that explicit about it but I think you need to do that.”

The cost of RTO mandates

RTO mandates come at a cost. There are financial implications, logistical implications, and, above all, personnel implications. In Murphy’s eyes, the latter is by far the biggest cost of mandatory RTO. In short, you’re going to lose and fail to attract talent. Productivity may go up or down, financially it could go either way, but one thing we know is mandatory RTO is unpopular, and for many it’s a reason to move on. “If you say you’ve got to be in five days a week, we’re seeing that people will kind of shake their head, but they immediately start searching for a role where they can get more flexibility. We’re finding that remote work is highly desirable,” Murphy explains. “I think employers need to understand that the more talented you are, you already command the ability to market yourself.”

For software engineer Steve, that’s exactly what happened. His employer instigated an RTO mandate and he immediately started looking for a new role, despite having only been with the company a few months. For him, the payoff simply wasn’t worth it. “I would miss out on taking my kids to school and picking them up, I’d have to spend hours a day in my car, not to mention the costs of that commute and the general exhaustion that would entail, ultimately making me less productive.”

Flexibility is what employees want, and the top candidates in any role will be able to command it. An IBI report showed that half of employees felt they were more engaged when working from home. People are happier when they achieve a greater work-life balance and happy workers are usually productive workers.

RTO mandates, diversity, and inclusion

There are a plethora of reasons people find it easier to work from home, from neurodiversity to physical disabilities, anxiety, being a caregiver, or even being female (because in the US, women still shoulder the greater load of work in the home). When location isn’t an issue for work you can recruit a much more diverse selection of society and you take away the barriers of distance, cost of living, and the physical ability to travel, for example. However, Murphy isn’t convinced that an RTO mandate alone would impact DEI: “I don’t know that I would single RTO out as impact DEI any more than other things. There’s a lot of other stuff going on,” he shares. That said, the fact remains that workers of color, workers with disabilities, workers with caring responsibilities, and workers based in more rural locations are likely to be disproportionately affected by RTO mandates and more of them are likely to quit. Although he is not the main caregiver for his kids, Steve made it clear that getting to see his kids on his breaks and taking them to school was a major factor in his decision to quit.

While for some mental health is improved by working from home, for others coming together in the office can be beneficial. Murphy recalls an introverted colleague who shared that although he loved working from home, hybrid work was probably good for him because it required him to interact with others and he realized he needed contact with other human beings for his mental health.

Are blanket RTO policies short-sighted?

The evidence so far seems to indicate that having some time when people are in the office together is ideal, but when you’ve recruited people into remote roles, it’s not always that simple. Another of Steve’s arguments against working full time in the office is that his team is an international group based in various countries around the world, so even if he was in the office every day, he wouldn’t be interacting in person with his team. There was some backtracking on the RTO mandate at his company several weeks after it came out, and local managers were given the discretion to decide at a closer level what was right for each employee. Steve was offered the chance to keep his remote status, but he’d already accepted another role.

If RTO mandates are seemingly being sprung on employees, the company culture is already lacking, and this is only fueling that. For example, look at the phenomenon of hushed hybrid, where local managers are allowing workers a hybrid schedule despite RTO mandates being in place. Or, as in the case of Amazon-owned Whole Foods, CEO Jason Buechel looking for ways to take a softer approach.

Murphy believes that a hybrid workplace is the key to retaining top talent and providing the benefits of being in the office working together that CEOs are looking for. He stresses that for it to work, specific days need to be agreed on because “employees feel nothing but more annoyed when they find out that they are in the office and they’ve got half a dozen other people coming in over video.”

Are RTO mandates a ‘clever’ attrition plan?

Could RTO mandates be a subtle strategy for reducing headcount without layoffs? According to Murphy, relying on RTO to drive attrition is “kind of like a sledgehammer to get rid of employees.” While forcing some workers out might lower costs, it can also have unintended consequences, like losing high performers who find rigid policies too limiting. A study by Gallup shows that employees who excel in customer service, for instance, are four times more likely to exceed profit goals and five times more likely to hit sales targets. Driving away such high achievers over inflexible policies could benefit competitors rather than the company. Employees to consider their priorities and look for workplaces where they feel valued and supported, especially if rigid RTO policies clash with their work-life balance needs. In Murphy’s view, companies should invest in retaining their best talent rather than enforcing ‘one-size-fits-all’ mandates that may end up doing more harm than good.

If companies want a return to the office, then they need to create a business case that outlines the benefits and reasons for doing so. By gathering input from managers, employees, and HR early on, organizations can better understand and mitigate the potential impacts on morale, productivity, and company culture. While RTO mandates aim to bring back in-person collaboration, a rigid approach could create as many challenges as it solves, especially in a post-pandemic work landscape where expectations around flexibility have permanently shifted.”

Key takeaways: Navigating RTO mandates

As RTO mandates become a sticking point in today’s work culture, understanding their implications for both employees and companies is essential. While executives emphasize the benefits of in-person collaboration, these policies can feel restrictive to workers who have grown accustomed to flexibility.

• The goals of RTO mandates: Many leaders believe that in-office work reinforces company culture and communication. However, blanket RTO policies may lead to frustration and declining trust among workers who feel their needs for flexibility are ignored.
• The importance of flexibility: Hybrid and remote options are not just preferred by employees—they’ve been shown to boost engagement and morale. Without the option for flexibility, top talent may leave for companies that offer it.
• Impact on career development and inclusion: RTO mandates can affect diversity and inclusion, particularly for employees with caregiving responsibilities or disabilities, or those in rural areas. Companies must carefully balance the desire for office-based work with the need for an inclusive work environment.

Ultimately, achieving the right approach will mean balancing company goals with employee needs for a work model that drives both productivity and satisfaction.

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