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Financial Contributions to Home Working: What Should Employers Provide for Their Employees?

Hannah Watkins
Hannah Watkins|

With remote working now generally hailed as a success by businesses of all shapes and sizes, it looks likely that it will become a permanent fixture in the world of work. As a result, business leaders and HR factions everywhere are now having to revisit their companies’ work policies and make fundamental changes to reflect this new norm.

This presents a whole array of challenges. But one key question that seems to be on everyone’s minds is this one: what should employers provide for their employees while they’re working from home?

There are two main elements to consider in the answer to this question: what you must provide, and what you could provide. 

Below, we’ll talk through what employers do (and don’t) legally have to provide for their employees. We’ll also discuss best practices, and explore how various companies are already introducing allowances, budgets, and perks that reflect the shift to more regular remote working. 

What do employers have to provide for their employees from a legal standpoint?

Given the unprecedented and changeable nature of the pandemic’s effects, it’s taking some time for home working regulations to come into effect—and at the moment, UK businesses might find themselves in limbo. Nevertheless, the following regulations around financial contributions do apply (this does not include health and safety requirements): 

  • A company must ensure that employees have the tools they need to complete their job effectively. Whilst working from home, this includes equipment such as laptops, computers, phones, and internet.
  • There are also tax exemptions on some of these items, meaning that employees can purchase the office equipment necessary for them to work from home without worrying about the tax and National Insurance consequences. Employers will also no longer need to report the reimbursed expense which would normally be liable to tax and National Insurance contributions.

Whilst it’s not yet a legal requirement, good practice would also involve giving all employees a full DSE (Display Screen Equipment) assessment and a home working risk assessment. The employer should then carry out the necessary upgrades to employees’ homes to bring them in line with the expectation of what you would get in an office. We can make the whole process quick and hassle-free via the HubbleHQ Home Working Assessment.

However, at present there is no legal obligation for employers to pay for employees to modify their home—for example, buying them a desk. Other than the above, most financial contributions are currently at the employer’s discretion.

But—and this is a big but—whilst providing your employees with certain working from home equipment and perks is not yet obligatory, not doing so could have much greater costs for your company. Employee health, morale, and productivity could all suffer greatly if not addressed, resulting in poor performance and high employee turnover.

What do employees think?

As such, it’s worth staying ahead of the game and thinking about how to recompense your employees even before regulations come into place. Indeed, in our Should we ditch the office? Survey—in which we asked over 1,000 employees how and where they would like to work in the future—a number of respondents brought up the subject of how they would expect their employers to contribute financially to their home working setup. 

Many highlighted that if their company was able to lower overall office costs due to more of their team working remotely, they would expect to be remunerated in some way. After all, many companies use their office as a perk in itself; with serviced office spaces offering free barista coffee, gyms, and events, amongst many other things, many modern companies pride themselves on the employee experience of being in a nice office environment. Without an office to offer these perks, some employees feel that they should be replaced somehow.

Another valid concern centred around the “level playing field” of the office. With a central HQ, each employee has access to the same facilities and surroundings as their colleagues—such as stable internet, meeting rooms, or breakout space. Some respondents felt that working from home more permanently put some employees at a disadvantage—and that this should be taken into consideration when adjusting working practices.

“It is very, very important in a moment of great change like this one that we implement permanent WFH (if we go in that direction) in an equitable way. There are hidden financial inequalities on teams that will come to bear if we do not make sure everyone has what they need to create a “home office.” We must be very intentional to support staff to WFH in meaningful ways like rent stipend rather than just cosmetic things like chairs or snacks.

Ideas of how to support employees financially whilst WFH

With all of the above in mind, below we’ve identified some of the most common ways in which real-life businesses are supporting their employees whilst working from home.

Give employees a budget to buy what they need

Knowing that different employees may benefit more from different things, some companies have opted to give their team members a one-off budget to purchase their own choice of WFH equipment.

For instance, Streetbees have introduced a “WFH in Comfort” scheme, giving all of their team members a budget to buy things like desks, monitors, or extra peripherals.

GoSquared, who have also introduced a one-off WFH Allowance of up to £500 to each full-time team member, told us: “Since June, we’ve had more than half of our team members use their allowance, with the most common purchases being chairs, desks and screens (no surprise there!). To ensure that everyone takes advantage of the scheme, we proactively send monthly reminders to those who haven’t used their allowance yet!

When we decided not to renew our office membership at the end of May, we ended up saving a lot from not paying any rent. We also had one of our team members go fully-remote last year, so the idea of covering the cost of them setting up their local office at home made a lot of sense. In addition to this, we heard that other larger tech companies offered their employees similar schemes, so it was a no-brainer to go for it too!”

Of the companies we’ve spoken to, budgets have varied between £120 and £600 per person, often depending on what employees already have access to and/or might need. We have also spoken to companies that give no fixed budget, but have instead adopted a “request for approval” system.

Purchase hot desk memberships for employees who can’t WFH

Though working from home has been enjoyable for many employees, there’s no doubt that there are some who dislike it. For many, the home doesn’t provide a healthy and productive work environment—and as a result, some employers are looking for ways to provide their workforce with external workspace closer to home.

One option is to purchase hot desk memberships for employees, using the money that would have otherwise been spent on the company’s primary office.

London-based eCommerce specialists NOVOS told us: “We’ve allocated a budget to each team member, and set them up with a WeMembership, so they can book workspace/meeting rooms with credits via their WeWork login. We have a shared Notion Calendar where someone puts their name on the day they’ll be in—so far it’s worked well, and we’re able to control the use of the budget pretty effectively.”

Another option is to take office space with a provider that gives business tenants access to any of the workspaces in their portfolio—so employees can choose to work in the one that’s most convenient for them. As well as having sites across various London boroughs and zones, some of these operators also have workspaces elsewhere the UK or even the world. 

We’ve listed the workspaces with multi-location access here in this blog.

Offer employees a choice between the two

Learnerbly, a progressive workplace learning platform, have chosen to be fully distributed in light of COVID. They’ve opted to offer their employees a combination of the two approaches above: all of their team members now have the choice between an allowance of up to £500 to make their working from home setup safe and healthy, or a hot desk subscription at one of Runway East’s London workspaces.

“The decision to go full-remote was made in light of COVID-19 and informed by our people’s feedback. We want our people working in the best possible conditions, whatever that means for them. Not everyone’s comfortable working from home and being distributed doesn’t mean you’re bed-bound..! That’s why we have given people the choice between a WFH allowance and a hot desk pass.

For people who’d rather WFH, it’s important they can do so in the best possible conditions. We sent out a risk assessment survey to ensure people could work in healthy and safe environments at home. If someone lacks a desk at the appropriate height or a comfy enough chair, they have no choice but to start by spending their WFH allowance on those things. Once the essentials are sorted, they are free to spend the rest on fancy noise-cancelling headphones or put it towards their utilities through payroll as per the HMRC scheme.

You can’t expect everyone’s home environment to be conducive to work whether that’s because of external factors such as flatmates, space or noise-pollution or because of internal factors including mental health and lifestyle preferences. Hot-desking is an option but we’re not engaging in a hybrid model in the sense that, people can work from their hot-desk as they like, but we still expect everyone to hop on video calls from their individual screens even if they’re in the same location.”

Increase employees’ salaries

In place of allowances or extra perks, some companies have instead chosen to just increase the salaries of their employees. 

Indeed, a number of respondents in our survey told us that for them, one of the key problems surrounding working from home was a lack of space, and the fundamental unsuitability of their home environment.

As such, these people felt that the thing that would be most effective in remedying the situation would have to be a pay rise, that would help employees afford to live somewhere more comfortable and suited to WFH in the long-term.

There are businesses that have already started to adopt this approach. Brett Downes, from Cardiff-based Haro Helpers, told us:

“Due to extra capital available, I have upped staff’s bonuses by 5% each month, as well as providing $50 monthly food vouchers for them to use on takeaways and eating out—as I’m saving on providing snacks and things in the office. Once the pandemic is fully over, we will assess if anyone wants to return to the office, then I can decide if we can downsize our office and then raise the base salary for remote workers.”

Adapting perks to reflect the new norm

With less time spent in the office, limited capability for social events, and new priorities taking the fore, some companies are now choosing to adapt their benefits and perks as a way to keep their employees motivated.

But what do employees feel would most significantly improve their working from home experience? We asked this exact question in our Should we ditch the office? Survey. The 10 most popular responses were the following: 

  1. Ergonomic chair
  2. Dual monitor
  3. Faster WiFi
  4. Standing desk
  5. Food allowance
  6. Coffee subscription/allowance
  7. Garden office
  8. Normal desk
  9. Noise-cancelling headphones
  10. Cleaning

Find out more about which provisions employees would value the most whilst working from home.

Though these ten provisions were the most popular overall, we did some digging and actually found that employees of different ages had quite different priorities. This is the full breakdown of how age impacts working preferences—the key message being that you shouldn’t presume that all of your employees want the same thing.

Find out how your team want to work in the future

Whilst the strategies above work for these companies, that’s not to say that they’re the best approach for yours.

We can’t emphasise enough the value in talking to your employees about how they feel about working from home, and what they would value the most. Getting to the bottom of the problems, challenges, and concerns can uncover fundamental changes needed, and go a long way in avoiding conflict later down the line.

To help you do exactly that, we’ve created the free-to-use Workplace Strategy Tool, designed to help you find out how your employees want to work, and give you instant actionable insights on which workplace solutions are right for your business.

With the tool, you’re able to easily survey your own team using our curated questionnaire, access the data immediately via your own personalised results dashboard, and get free, professional advice on the best next steps from our team of experts. Head to the link below to get started!

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