Some of the world's largest tech companies are riding the wake of Amazon's decision to return to in-person work for five days a week, with businesses increasingly looking to bring people back to the office as executives lose their taste for remote or hybrid arrangements.
Dell Technologies is the latest to enforce a stricter return-to-office mandate that calls for its salespeople to be onsite for a full, five-day workweek. The Round Rock, Texas-based company began escalating its in-person requirements earlier this year, and its latest order echoes the progressive shift across corporate America in pushing to get more employees to return to physical offices.
The company told employees of the decision in an internal memo, earlier reported by Bloomberg.
“The expectation is that ALL Global Sales team members who can work from a Dell office be onsite five days a week, regardless of role,” Bill Scannell, Dell's president of global sales and customer operations, and John Byrne, its president of sales, wrote in the memo.“We know situations will arise when you need to work remotely. This is expected, but working remotely should be the exception rather than routine.”
The new requirement effectively ends Dell's hybrid policy for employees across its sales divisions.
The company, one of the earlier champions of remote work, earlier this year adopted a requirement for most of its employees to show up to an office at least three days per week, and monitored attendance through badge swipe tracking. Employees able to maintain fully remote roles were told that they would be ineligible for promotions if they did not return to an office, with Dell saying in an earlier announcement that "for remote team members, it is important to understand the trade-offs."
However, after a few months of still-empty offices and coordinating across multiple time zones, Dell is the latest company to pull the plug on its flexible work arrangement.
"We continually evolve our business so we're set up to deliver the best innovation, value and service to our customers and partners," a Dell spokesperson said in a statement to CoStar News. "That includes more in-person connection to drive market leadership."
Changing course
The revised policy marks a sharp turn for Dell, which previously said about two-thirds of its workforce could continue working from home until the pandemic ended, and even then would only be required to show up to an office for one or two days per week. Starting last year, however, the company began walking that leniency back with a previous mandate requiring all employees living within an hour of a Dell office to come in at least three days per week.
Earlier this year that widened to include all employees, regardless of where they lived or how long it would take for them to commute to a physical workspace.
Dell, with about 120,000 workers, occupies about 9.5 million square feet of office space around the world, according to CoStar data. The company did not detail how many of those employees were dedicated sales professionals and thus impacted by the new in-office requirement.
Dell's escalated mandate is the latest in a slew of similar policies implemented by companies pushing to enforce stricter in-office schedules. UPS, Disney, Amazon, Bank of America, Meta and others have recently ramped up efforts to get workers back to physical office space, deploying a mix of strategies that include attendance-tracking apps, asking employees to relocate, and threats to link in-person time with annual performance reviews.
Amazon last month made headlines with its decision to dump remote working arrangements for all of its employees, a move CEO Andy Jassy said was critical to "strengthening our culture and the effectiveness of our teams."
"When we look back over the last five years, we continue to believe that the advantages of being together in the office are significant," the CEO told employees. "Before the pandemic, it was not a given that folks could work remotely two days a week, and that will also be true moving forward—our expectation is that people will be in the office outside of extenuating circumstances. If anything, the last 15 months we’ve been back in the office at least three days a week has strengthened our conviction about the benefits."
Amazon's five-day policy will take effect early next year.
Uncertain path forward
The escalated mandates implemented by companies such as Amazon and Dell could result in workers willing to quit rather than be forced to commute to an office, said Stanford University economics professor and remote-work analyst Nick Bloom. He added that quit rates at Seattle-based Amazon could jump by as much as 30%.
Even so, given Amazon's influence both in and beyond the tech industry, its return to physical office space could send far-reaching ripples across corporate America.
"Amazon is iconic for the tech sector, so other tech firms, including many start-ups, will take notice," Bloom said, adding that "there’s some chance other firms could push for more aggressive return to office policies."
One of three scenarios will likely play out, he said, either with Amazon backfilling open roles and plowing ahead with its five-day mandate, changing course within the next year or so, or dropping the enforcement altogether.
For now, at least, more employees in the office more frequently has been welcome news for a real estate industry scrambling against a tide of record vacancies and tenant move-outs.
Hybrid mandates have largely been attributed to contributing to the national vacancy rate rising to a record high of nearly 14%, according to CoStar data. The policies have fueled some space cuts among companies that have looked to adjust their corporate real estate footprints to accommodate workforces that don't commute as often as they once did.
Office attendance has largely flatlined, and employees are spending about 60% of their working days in a corporate office, a marginal increase compared to this time last year, according to Stanford University's Survey of Working Arrangements and Attitudes.
Stricter in-office mandates aren't considered likely to meaningfully move the needle in terms of backfilling the glut of vacant office space tenants have offloaded in recent years. What's more, some aren't done figuring out just how much space they need and whether they need to make additional cuts.
"Most organizations now have a much clearer picture of how they want to use their office space," said Phil Mobley, CoStar Group's national director of market analytics. "Given how much pre-pandemic leased space still has yet to face expiration, there are surely more footprint adjustments to come. However, most of this has already happened or is reflected in the sublet market. Thus, it appears that job growth, rather than workplace policy, is resuming its role as the primary driver of office demand."