"Working from Home? Then Cut the Salary" US Companies Take a Hard Line on Remote Work

JP Morgan warns of 'performance management' and 'bonus cuts' for missing thrice-weekly office attendance
Major law firms also follow suit

As COVID-19 enters the endemic phase, while American companies are reducing remote work, some have even imposed 'salary cuts' as a condition to encourage office attendance.

According to major foreign media on the 12th (local time), the operating committee of JP Morgan Chase (JP Morgan), the largest bank in the United States, requested the company's executive directors to come to the office five days a week. Additionally, employees using the 'hybrid work' system, which combines remote and office work, were instructed to come to the office at least three days a week.

Exterior view of the JP Morgan Chase building.
[Image source=EPA Yonhap News]

In a memo sent to employees that day, the JP Morgan operating committee explained, "Our leaders play a crucial role in strengthening the corporate culture and operating the business. They need to be visible on the floor, meet with clients, provide guidance and advice, and always be accessible for immediate feedback and meetings."

Furthermore, it notified general employees, "Many employees are not meeting the office attendance requirements. This must change," and warned, "If company policies are not followed, managers may take appropriate performance management actions, including 'corrective measures.'"

Efforts by companies to bring remote workers back to the office continue, and some even threaten disadvantages if employees do not come to the office.

According to a report by The Wall Street Journal (WSJ) on the same day, Davis Polk & Wardwell LLP, a major law firm serving large Wall Street banks and companies as clients, recently instructed employees to come to the office at least three days a week and warned of 'bonus cuts' if this is violated.

According to WSJ, until recently, the U.S. labor market was overheated, and with the trend of employees quitting their jobs known as the 'Great Resignation,' companies were somewhat cautious about reducing remote work due to concerns employees might leave.

However, as the COVID-19 pandemic eased last year and signs of economic slowdown continued this year, companies are beginning to seek changes.

U.S. Remote Work Reduction Approaches Pre-Pandemic Levels

Mark Zuckerberg, CEO of Meta. [Image source=Yonhap News]

According to recently released business survey data from the U.S. Department of Labor, 72.5% of workplaces reported that employees did not work remotely at all or hardly at all last year. The proportion of workplaces with employees working on-site rose by more than 12 percentage points compared to 60.1% in 2021, approaching 76.7% in February 2020, before the COVID-19 pandemic.

Mark Zuckerberg, CEO of Meta, sent an email to employees last month stating, "Face-to-face time builds relationships (among employees) and helps get more work done." Walt Disney recently instructed employees to work on-site at least four days a week, and Amazon is reportedly ordering employees to come to the office at least three times a week starting in May.

Regarding this trend of reducing remote work, Mike Steinitz, Senior Director at global staffing consultancy Robert Half, explained, "Managers believe employees are more productive in the office," adding, "Office work is considered important not only for new hires but also for mentoring and training existing employees."