Will employers have to incentivise employee commutes?

Are Paid Commutes the Future? Business owners believe that commute-related incentives are key motivators for getting employees back into the workplace

Research has revealed that 86% of business owners believe that their employees will be more likely to return to offices if their commute was incentivised.

Over three quarters (76%) of business owners believe that if commute time could be included in working hours, employees would be amenable to a more permanent return to the office. This would enable employees to arrive later and leave earlier if they were able to work en route. In fact, over one in four (26%) employers think this will be the most effective measure to encourage employees back into their workplace.

One of the biggest challenges facing employers keen to attract more employees back to the office is the significant financial savings that hybrid working has brought. NerdWallet research has found that employees who were able to work remotely or in a hybrid model, saved, on average, £234 a month by cutting out commuting costs, reducing the appetite for a daily commute.

With many struggling to save for a mortgage deposit in the wake of the rising cost of living and record average house prices (£278,123 in February 2022, according to Halifax’s House Price Index), over a quarter (29%) of employees are prepared to add up to 45 minutes to their commute to afford a property if their commutes were less frequent.*

As a result, employers may need to incentivise the commute to make attending the office a more attractive proposition to the workforce, with NerdWallet’s research suggesting that most employers agree on these hypothetical measures. A large majority of businesses (86%) felt that reimbursing commuting costs would be an effective incentive. This could be implemented in the following ways:

  • 68% agreed with reimbursing commute expenses, e.g. a bus or train pass
  • 67% agreed with paying for parking
  • 64% agreed with cycle to work incentives, g. cash back on bike purchase schemes
  • 63% agreed with grants for electric vehicles used for commuting

In terms of how these incentives could be implemented, employers were asked about how they could be calculated and whether limits would be needed. To ensure equality when introducing commute incentives:

  • 39% felt that a maximum travel distance per day should be set
  • 41% felt that a maximum travel time limit per day should be set
  • 42% felt that a limited number of days’ public transport should be reimbursed

However, more than a third (38%) of employers were more generous, stating they felt public transport costs for the entire working week should be reimbursed if their employees were required to return to the office full-time.

Of the employers who were more open to a hybrid model with three days in and two days remote, 42% thought paid incentives were important to motivate a voluntary return to the office compared with only 21% of those wanting a full-time return to the office. By contrast, 45% of those looking for a full return to the office prefer to make the office space itself a more appealing destination to draw people back in.

Research from NerdWallet*

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