Deutsche Bank to change work-from-home policies permanently in bid to reduce office costs

 Deutsche Bank is set to make flexible working policies permanent to allow staff to work from home on a set number of days per week.

Like other lenders, Deutsche Bank has discovered during the pandemic that reducing office space could be a viable way to lower costs.

Chief executive officer Christian Sewing said the board was working on a “hybrid model” that would allow employees to split their time working between the office and home.

The new policies will provide staff with binding agreements as to how many days can be spent working from, according to Bloomberg.

Other lenders including Mizuho Financial Group and Fifth Third Bancorp also have plans to lower office costs after the pandemic, with executives surprised by how little productivity has been affected.

However, Wall Street giants, JP Morgan, BlackRock, and UBS have been more skeptical, claiming productivity will slip if people work remotely for too long and that there is a risk of losing the corporate culture.

Despite calls for a return to the office, a resurgence of coronavirus cases in the UK, in particular, has led to some partly halting those plans.

He said the bank now sees room to lower the costs of office space having spent 1.7bn euros (£1.55bn) on rent and furniture alone last year.

It comes after the bank gave up two of five floors at an office in Zurich, moved to a cheaper location in London, and moved spaces in New York to reduce office space by a third.

The average percentage of employees who will work remotely at least part of the time is projected to nearly triple from 12% before the COVID-19 pandemic to 30% after the pandemic, according to 835 US employers responding to XpertHR’s Survey on Employer Response to COVID-19.

During survey fielding—which was late July to mid-August 2020—an average of 51% of employees were working remotely, indicating that while remote working arrangements will be less common in the post-COVID environment than during the pandemic, they will remain elevated over pre-pandemic levels.

“It is clear that COVID-19 will shape the working world for years to come, in particular contributing to a rise in remote work set to last beyond the end of the current health crisis,” says Andrew Hellwege, Surveys Editor, XpertHR.

The survey also asked responding HR professionals to rate how challenging 10 COVID-19-related issues have been and found that maintaining employee morale has been the most difficult, with 76% of participants rating this as either “somewhat” or “very” challenging.

“Given the tremendous strains placed on workers during the pandemic, such as fear of layoffs, isolation of remote work, increased caregiving and homeschooling responsibilities, and concern about contracting the disease itself,” says Hellwege, “it comes as little surprise that maintaining employee morale has been a considerable challenge for employers.”

The survey sheds more light on the economic devastation caused by the novel coronavirus, as employers noted several ways they have cut labor costs due to the pandemic. The most common labor cost-saving measure has been the hiring freeze, which has been implemented at some point during the pandemic by 31% of the 835 responding employers, with furloughs (26%), decreased employee hours (25%), and permanent layoffs (24%) rounding out the top four measures. (The survey asked about several labor cost adjustments, and respondents could choose more than one.)

The report also discusses what measures employers are taking to support the wellness of their employees during these unprecedented times and shows that offering flexible work schedules to allow for caregiving or homeschooling has been the most popular option, with 70% of responding employers taking this step. (The survey asked about several wellness measures and respondents could choose more than one.)

“There has been a clear need for more flexible work scheduling due to disruptions in childcare, schooling, and other routines in daily life,” notes Hellwege, “and the survey shows most employers have tried to provide this flexibility to help their employees adjust to the new normal.”

XpertHR’s Survey on Employer Response to COVID-19 was conducted from July 28, 2020, to August 14, 2020, and published in September. The survey includes responses from 835 US employers of various industries and workforce sizes. The total estimated number of employees of responding organizations is 1,095,245. The survey report covers several topics, including workplace safety, remote work, labor cost adjustments, employee performance, employee wellness, and emergency preparedness planning.

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