Is your Company Paying 'Work From Home' Allowance? How much should Companies Pay Employees? Details

The coronavirus pandemic has forced employees across the globe to shift to work from home. As many companies are considering permanent work from home, many employees are expected to arrange infrastructure that would enable them to work comfortably. Employers are hence considering paying them additional money especially since companies have cut down on overhead and rental costs.

Reportedly, Indian offices spend around 4.3% of their revenue on corporate real estate including rentals and overhead costs. “If they were to adopt a 50% work from home norm and have to compensate employees with Rs 10,000 per month for the work from home infrastructure, net savings on CRE (corporate real estate) would be down by 15% with impact on margins of 70 bps,” a Kotak Institutional Equities report said.

At the same time, there is an argument against work from home as well. “The moot point on working from home and the potential savings from the same is whether ‘work from home’ is a convenience offered to employees and hence does not need to be compensated,” the report said.

Internet connectivity, weak infrastructure and smaller homes are some of the problems that employees are facing. Almost 75% of Tata Consultancy Services (TCS) employees are working from home. Companies such as Amazon, LinkedIn, Google and others have given work from allowance to employees.