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Analysis of flexible working on employee productivity and satisfaction

Valentina GolubovicValentina Golubovic
Last updated on:
December 2, 2022
Published on:
September 23, 2022

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Flexible working has been a hot topic within the employment field. Businesses have been exploring this model to retain employees, and employees have been looking at it as a way to balance work and personal commitments. Research is unsure of the effectiveness of this model, but trends seem to show that flexibility can lead to happy employees with more job satisfaction.

What is flexible working?

CIPD defined flexible working as “giving flexibility over where, when and the hours people work.” Flexible working is an employment practice that makes it easier for a person to balance their home and work life.

Types of flexible working practices

  • working from home 
  • working remotely (abroad)
  • working in shifts
  • working part-time
  • Flexi-time options
  • compressed hours, where you work your usual hours on the days of your choice 
  • job sharing
  • term-time work, so employees do not work during the school holidays
  • annualised hours, where the usual hours are organised around the number of hours to be worked over a year compared to over a week

Main drivers for flexible working 

In the last few years, the pandemic outbreak, technological advances, and increased business costs have driven the shift to a more flexible working environment as employers were forced to implement home working, which has proven to benefit employees and employers. 

Other leading drivers of flexible working include: 

  • employee's capacity to perform work duties remotely
  • management trusts employees
  • employee preference 
  • reduced fixed costs

Impact on employee satisfaction 

Introducing flexible working policies can help companies meet the needs of their employees and encourage them to be motivated, thereby improving employee satisfaction. 

When it comes to flexible working, Nordic countries like Denmark stand out. They also seem to have one of the highest job satisfaction rates. However, other factors may be at play, such economies tend to have higher levels of economic equality and trust, so it may not be fair to attribute satisfaction to flexible working. 

While many studies suggest that working from home, or at least the option to, can increase employee satisfaction, some studies indicate long-term working from home can be linked to increased stress levels. Microsoft's New Future of Work Report 2022 showed that although remote work can increase job satisfaction, it can leave employees feeling “socially isolated, guilty and try to overcompensate.” This suggests that while some flexibility might be beneficial, overly flexible arrangements can harm employee wellbeing. 

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Impact on productivity 

Flexible working can improve productivity for businesses and the UK economy. It allows more employees to enter the labour market, increasing the workforce as it accommodates different circumstances like childcare responsibilities. 

It also reduces absenteeism as it adapts to those with caring responsibilities, medical illness, physical or mental and other factors. Statista reported that in 2020 in the UK, employees who worked from home had a sickness absence rate of 0.74%, while those who didn't have an absence rate of 2.2%. This suggests those with the option to work from home or on flexible hours are less likely to take sick days off.

Flexible working also gives employers access to a broader pool of candidates, improving diversity and competitiveness in the workplace. CMI’s management manifesto in 2017 stated that a “better gender balance in the workplace could add £150bn a year to the UK economy”. Flexible working arrangements with parents or carers can work around will make the job suitable to more candidates than a rigid 9 to 5 full-time in-office schedule. 

When it comes to productivity, it is also important to consider employees will pick a job which suits them. If a workplace offers flexible working and the employee prefers this, they may find themselves more productive when working from home. In contrast, those who prefer a full-time office role will opt for a job that allows them to be in the office full-time, making them more productive than if they were forced to work from home.

Challenges in keeping remote work secure 

Most companies use employee time tracking software to track employees' activity while implementing flexible working in the workplace. Implementing flexible working can be advantageous but it has its fair share of challenges.

Proximity bias

This is the notion that employers will favour those in their vicinity compared to remote workers creating an inequitable and unfair work environment regarding promotions and other aspects of the workplace. Proximity bias is natural as it evolves from building rapport and trust with those closest to us. 

This can impact the productivity and satisfaction of employees who are remote however you can take steps to reduce this by using centralised communication platforms allowing everyone the same access to information, as well as implementing fair and target-based appraisal. 

Company culture

Flexible working can impact your organisation's culture. Remote employees may not be as tight, which may be evident in the quality of projects completed. Effective communication is necessary, especially in early-stage companies. Promoting cohesion through socials, designated office days, and non-work-related meetings. 

Employees are all different and function optimally in other circumstances. Unfortunately, there isn't a one fits all approach, so it is vital to be aware of your company's objectives and your employee's needs. If you are thinking about implementing flexible working, think about the challenges which can arise and how you can minimise any risks.

About Legislate

Legislate is a legal technology startup which allows landlords, letting agents and small businesses to easily create, sign and manage contracts that are prudent and fair. Legislate’s platform is built on its patented knowledge graph which streamlines the contracting process and aggregates contract statistics to quickly unlock valuable insights. Legislate’s team marries technical and legal expertise to create a painless, smart contracting experience for its users. Legislate is backed by Parkwalk Advisors, Perivoli Innovations and angel investors.

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