Flexibility Builds. Mandates Break.
Revenue growth is 1.7x faster than our peers.
Company growth is 1.3x faster than our peers.
Employee satisfaction is up.
Competitive advantage is up.
Expanded talent pool.
Increased retention rates.
That is the conversation I would like to be having with my board and shareholders.
What if I were one of the peer companies with very different results? How would that conversation go with the board and shareholders when they ask why?
I would have to bow my head and admit, “It’s our return to office mandate!”
The research
New research by Flex Index and Boston Consulting Group reveals flexible companies grew revenues 1.7x faster annually than mandate-driven peers between 2019 and 2024.
As CEO at Work Forward, Brian Elliott, said in his article on LinkedIn, “The Workplace Policy that’s Creating a Two-Tier Economy, “even after adjusting for industry and company size, fully flexible firms grew 1.3x faster than peer companies. That is a substantial advantage.”
He reveals how the workplace is splitting along size lines, which he refers to as the David vs. Goliath divide.
· 45% of Fortune 100 companies now require 4-5 days in the office
· 67% of companies with fewer than 500 employees remain fully flexible
“This matters more than headlines suggest. Companies under 500 employees account for over half of US jobs and drove nearly all employment growth in the first half of 2025. While large companies tighten policies, smaller competitors expand their talent pools by offering what Fortune 100 firms won't: autonomy.”
Trust
Companies that have flexible work policies demonstrate that they trust their employees.
Before I talk about the financial aspects of trust in the workplace, let’s clarify what we mean by flexible work. It is not the mandate that you must be in the office 50% of your working hours. It is not saying you must be in the office on Monday, Wednesday, and Friday. That is not a truly flexible model, despite the company’s arguments to the contrary. A flexible work model means you can work where you will perform your best. It means the company treats you like an adult who can decide on the best place to work. When you decide to go into an office, it is an intentional decision for a quiet workspace, to connect with others in person, to team-build, or to do some high-energy collaboration. It is your decision, along with that of your team. It is not a mandate.
BCG’s Debbie Lovich said, “Flexible work policies are a sign of organizational cultures that trust employees, measure impact over input, and recognize that different people need different conditions to do their best work."
Michael C. Bush, CEO at “Great Place To Work”, said “High-trust workplaces achieve more than eight times more revenue per employee and outperform the market by nearly four times.”
In-office mandates and monitoring of employee attendance are a double-edged sword. Not only does it say, “I don’t trust you”, it also stifles innovation.
You cannot expect employees to embrace AI adoption when you don’t trust them. Innovation is about feeling safe to make mistakes, and that does not exist when there is no trust.
Outcomes
It’s that time of year when some of the Australian big banks determine staff bonuses.
It also equates to staff scrambling to be in the office as much as possible before the bonuses are calculated, as their bonus is tied to their physical presence in the office. Unless they meet the specified quota, their bonuses will be adversely impacted.
Sky News revealed on 29 August 2025, that the 4th largest Australian bank, ANZ, bases its performance and pay on three tiers.
1. Staff appearing in the office less than 20% of the time receive no salary increase or performance bonus unless they have an exemption.
2. Staff showing up to the office between 21% and 40% of their hours worked could have their bonus cut in half.
3. Staff showing up to the office between 41% and 49% would be subject to a conversation with their managers, who have been told to act against those who fail to hit the 50% requirement.
Pay raises and bonuses should be directly tied to employee performance and the outcomes they deliver. These companies are saying, “It’s not what you do, but where you do it that matters”
I have been saying, “Work is what we do, not where we go”, for some time. I am getting hoarse!
Managers burn-out
Return-to-office mandates don’t just put pressure on employees but also their managers. It puts another burden on managers who are already stretched. This will have a negative impact on health and well-being, potentially leading to burnout.
When employees are just ticking the boxes because they feel belittled, managers will struggle to achieve performance.
Jessica Guynn, writing for USA Today, quoted the sentiment of workers forced into the office, and this is what managers have to deal with
“So many companies got a whiff of people actually feeling a slightly better work-life balance doing WFH (work from home) and decided joy was not part of the benefit package.”
"I’m arriving exactly at (the) scheduled start, taking every lunch break away from my desk and leaving the second my day is over. You want to reach me via email or ping after hours? That’s too damn bad. I’m not feeling generous for an employer that treats me like a child."
The situation puts managers in an untenable situation – enforce company policy and suffer the consequences, or adopt what is called “stealth management” or “hushed hybrid.”
“The practice occurs when managers feel emboldened to introduce their own rules on business practices such as remote work, to fight against what they view as unfair ruling,” says Helena Young, Deputy Editor at Startups.
Mahalia Mayne explains. “Hushed hybrid is when managers quietly allow some employees to work from home or flexibly, contrary to office policy and days they should be in the workplace. The trend appears to be an under the radar reaction to the increasing popularity of ‘return to office’ mandates set by upper management.”
This places managers under significant pressure and has a profound impact on the culture. It can foster a sense of “secrecy and favouritism that can be toxic to workplace culture,” says Jim Moore.
He says employees will “invariably talk among themselves, and it won’t be long before any arrangements become common knowledge”, which in turn risks instilling a sense of unfairness and resentment among employees working for managers who obey the regulations.
"If a manager quietly permits an official policy to be violated, that sends an undesirable signal that workers only need to pay 'lip service' to company policies. It also could cause workers to question the manager's integrity in other areas.”
It also leads to inequalities and a two-tier workforce where some employees are given different work-from-home privileges than others. Resentment surfaces, and morale and team cohesion suffer.
Mandate and reality gap
Brian Elliot says that the latest Flex Index study. Show that the gap between policy and compliance – people actually coming back persists.
“Since early 2024, required office days climbed 12% – from 2.57 to 2.87 days per week on average. Yet actual attendance increased by just 1% to 3% depending on if you’re looking at Stanford professor Nick Bloom's SWAA or and Placer.ai's data through Q2.”
I love the analogy drawn by Stanford Professor Nick Bloom.
"The harsh return to the office mandate is like the law against jaywalking. It exists, everybody knows about it, and nobody obeys it because it makes little sense."
Size
“The most striking pattern in our data isn't about industry – it's about company size. Small firms employing half the US workforce offer dramatically more flexibility, with 67% maintaining fully flexible policies. Meanwhile, only 11% of enterprises with 25,000+ employees offer that same flexibility,” says Brian Elliott.
The Fortune 100 might be only 29% fully in-office, but another 16% have a four-day-a-week policy – not exactly flexible. The larger firms also aren't growing: BLS data shows that in 2025, virtually all net job growth in the US comes from firms with under 500 employees.
This creates a two-tiered labor market where your workplace experience depends more on company size than industry. A software engineer at a 200-person startup enjoys radically different flexibility and growth opportunities than their counterpart at a Fortune 100 giant, despite doing similar work.”
Flexibility works
Competitive advantage increases, while revenue and the company grow.
Employee satisfaction and productivity increase.
There is an expanded talent pool and increased retention rates.
“The difference between the companies that successfully navigate flexible work is they treat flexibility as a competitive advantage requiring investment, not a perk requiring tolerance.”
The future is organisations prepared to unlearn rather than return to how it was before March 2020.