Rethinking the corporate office environment
There is no doubt that the accountancy profession was undergoing a digital transformation, with new technologies challenging its future, even before the current pandemic.
The introduction of Making Tax Digital and surge in cloud-based systems had encouraged many firms to rethink their operating model, with some introducing completely flexible working hours and locations. Covid-19 has emerged as the real catalyst for change in firms taking digital steps, quicker than anyone could have ever imagined, and there have been some surprising results.
Following the release of the return to work guidance by the government, businesses will be busy scrutinising their internal operations in a way that has never been done before. Some might be considering whether they should take this opportunity to completely rethink and transform their business. Is the current floor space required? Is the spend on social distancing alterations and legal advice worth it? Should the office lease be ceased all together? And what lessons will they take forward from the lockdown period?
The silver lining to the recent disruption might be the new efficiencies and increased productivity gained through greater digital literacy. According to the Scottish Government, ‘working from home and the use of digital technology is likely to persist as part of the ‘new normal’’, so now might be the time to assess your digital roadmap and how employees work on a daily basis. Many businesses who have been working from home for some time, and those who have embraced this fully in the last few months, have reported that they actually work more efficiently, with a happier workforce, and that they will continue to work this way even when the restrictions are lifted.
The benefits of remote working for employees and employers include:
- Saving on commuting expenses and time.
- Better work/life balance for employees.
- Flexible hours to suit family commitments.
- Becoming fully paperless.
- Better communication within teams and clients.
- Larger pool of potential resources due to breaking down geographical barriers.
Property considerations
Interestingly, firms who had offered greater flexibility for some time prior to Covid-19 report that employees still choose to have a mix of home and office working to maintain human interaction and relationships. It is therefore unlikely that practices will abandon office space altogether, but its configuration, size and flexibility might become more of a consideration.
The use of mixed occupancy premises or serviced accommodation might well become more practical for many. Many practices already share premises or operate from a unit within a larger premises so the road ahead is likely to be challenging for landlords and occupiers as they implement and manage measures to avoid a resurgence in the coronavirus. Employees will not be able to return to the office overnight as steps will need to be taken to bring buildings up to operational level such as entrance protocols, reduced lift capacity, meeting room protocols and the staggered use of common areas to name a few.
Collaboration between the occupants, landlord and their agents should be starting now as part of the return to work plans. A recent article from Eversheds Sutherland, set out some of the potential ramifications that need to be considered and planned, to avoid delays, before any return to the workplace.
These included:
- Who is responsible for what?
Landlords are not always solely responsible for common areas in a building so this will need to be understood and agreed by both parties. - Who is going to pay for the post-lockdown operation checks and alterations?
Service charge provisions in the lease will need to reviewed to see if any amendments and costs of implementing them are covered by the current regime and if there is a ‘sweeper’ clause, which might allow the landlord to capture any costs outside the list of specific services. - How will this all be documented?
Most buildings have a tenant’s handbook documenting how a building should be run, with detailed rules and regulations, and leases generally include an obligation for the tenants to comply with these. Landlords will therefore need to amend the tenant’s handbook to enforce the new socially distanced rules. Both parties should review their leases to check whether any approvals or consultation is needed which is likely to be a lengthy process. A tenant may also want to implement their own solutions resulting in works being carried out, which might require consent. - Does GDPR need to be considered?
Any business that might want to consider temperature testing individuals before entering a building will need to consider compliance with GDPR as ‘health data’ is strictly protected. - What about the rights of the workforce?
Employment law will need to be considered by landlords and occupiers. Where proposed alterations to ensure social distancing would result in new working arrangements for staff, to what extent can these arrangements be legally imposed by the employer and how should they be implemented to mitigate legal risk. For example, what is the contractual position regarding requiring staff to work more flexibly?
Perhaps the last few months have shown up the good, or bad, decisions that your firm might have taken up to now regarding technology. It is never too late to address this; now is the prime opportunity for businesses to fine-tune their operations and plan for the future.