Can businesses cut remote workers’ pay?

Employment lawyers say this issue is a ‘minefield’ as Google becomes the latest firm to warn of possible wage decreases for staff who opt to work from home.

Google’s decision is the latest development in the discussion of returning to the office after an unnamed Cabinet minister suggested UK government civil servants who do not return to the office should receive a pay cut. The minister said that people who work from home are not paying commuter costs so they have a “de facto pay rise” which they said is “unfair on those who are going into work.”

For employers who want to stay in their workforce’s good books, ensuring that remote working capabilities are maintained in a fair and equal way will be key to future business success, offering both in-office and out-of-office flexibility is the way forward.

Reducing pay may be appropriate if the job role has changed.  This could be either because part of the role cannot be carried out away from the office or the employee has opted to work from home.  But, employers taking this route would still need to go through the proper process of changing terms and conditions, and should expect to face serious challenges from employees.

Employees could, for example, argue remote working reduces company overheads, meaning if productivity has not diminished, a pay cut would be arbitrary.  If employers wanted all staff to work from an office, they would face an increase in formal requests to work from home.

However, if firms went the other way and offered fully remote working and wished to reduce salaries, he said, they will need to gain consent which is not always a certainty. Employees who are not expected to commute, particularly into central London, are effectively being asked to waive their London weighting.

This is, however, an employment law minefield for businesses.  Any differences between the pay, benefits or prospects of those working from home when compared to those working in the office could give rise to discrimination issues.

For example, it can be said more women will choose remote working, because it better suits their caring responsibilities.  As such, if remote workers are paid less, it is going to have a greater impact on women. Due to this, the reasons for differences in pay will be critical in discrimination cases but also could damage the motivation and engagement of the workforce.

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