Banks, asset managers, insurers and accountancy firms in London’s financial centre and across the country are setting out plans for staff to work from home more regularly, as emergency measures introduced during the pandemic turn into permanent lifestyle changes.
Some big City employers such as NatWest Group and Standard Life Aberdeen have already announced that most staff will not be returning to the office until early next year, while companies including Schroders have updated their policies to allow staff to work from home most of the time.
“We have proven that working from home is possible for most roles,” said Stefan Seiler, group head of human resources at UBS, the Swiss bank that has 5,000 staff at its London office. “What is clear is that there will be more working from home, we will see more flexible work arrangements.”
Back-office staff at Virgin Money, the UK’s sixth-largest bank with 8,500 workers, have been told not to expect to return to their workplaces, according to two people close to the lender. Under plans being discussed with staff, non-consumer facing employees would spend the majority of their time working from home, while the bank’s main offices in Glasgow and Newcastle would be repurposed into “collaboration hubs” for meetings.
Virgin said it was considering “a range of options”. A permanent shift to remote working meant the lender could save more jobs when it closed offices in Leeds and Norwich.
Lloyds Banking Group is also looking into the most efficient ways for teams to use its office space. About 50,000 of its 63,000 UK staff are currently working from home.
British office workers lag behind their European counterparts in returning to work, according to research conducted by Morgan Stanley last month. Only a third of white-collar workers across the country were commuting in as of mid-July, half the proportion in the rest of Europe.
Workers in London and other big capitals heavily reliant on public transport are returning more slowly than those in smaller, regional cities.
“Our tenants are telling us they are planning to bring people back gradually. Some have increased the numbers significantly — up at around 25 per cent — and one or two are at 100 per cent,” said Howard Dawber, managing director of Canary Wharf Group. Across the estate, about 15 per cent of workers have returned.
Most companies are preparing to open up their offices to more workers from September, but with much reduced capacity. Aviva, the insurer, is planning for a return of about 10 per cent of staff at any one time from next month, while HSBC, Europe’s largest lender, is expecting less than 20 per cent. Asset manager BlackRock and accounting firm PwC, meanwhile, are preparing for 50 per cent capacity. BlackRock staff are not required to return to the office for the rest of the year.
The contrast between Santander’s London base and its Spanish headquarters highlights the difficulties facing businesses in the UK capital. While the bank’s employees in Madrid are spread across nine offices on a 600-acre campus with thousands of underground car parking spaces, London employees rely on busy public transport routes to reach its six-storey London office near Euston.
Almost two-thirds of Santander’s non-branch staff have returned to the office in Spain, compared with just 15 per cent in the UK.
Company bosses hope the move to more flexible working will improve staff morale and productivity. With fewer staff in the offices, they also expect to make savings on rent, with the potential for long-term leases to be broken.
M&G, the FTSE 100 fund group, this month said it wanted to make savings by extending remote working beyond the duration of the crisis, with staff expected to come to the office no more than two or three days a week.
Metro Bank had previously announced plans to exit its expensive Old Bailey office, but said this month that it was no longer intending to find a replacement. Instead it will combine staff with its other main London office, with few coming in every day.
“We found office space for everyone — it just looks a lot like their sitting room,” said Dan Frumkin, Metro Bank’s chief executive. “I wouldn’t have believed it was possible if you’d asked me in February.”
There is some evidence of a divide between senior executives and more junior staff at some companies.
One chief executive of a large global asset manager argued that face-to-face relationships were vital to the success of the business. But several lower-level staff at the same group said they were happier working from home.
“A blend of office and homeworking is the future,” said Kevin Ellis, chairman and senior partner of PwC UK. “But there’s still very much a place for the office.”
Additional reporting by Peter Smith, Kate Beioley and Siobhan Riding
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