London Weighting, would you pay it back to work from home?

[Jenasaurus]

Just been listening to LBC and they were discussing commuters who normally work in the city and are paid London weighting for doing so paying it back if they no longer work in the city but from home

I can see the logic as the expenses incurred would no longer be valid but if you are one of those affected would you be happy to do so or prefer to go back into the office to work.

why would no one who lived in England emigrate to Romania?

I guess it could be done, and I hate to bring up the B word, but the loss of Freedom of Movement for work purposes (due to Brexit) has complicated that somewhat.

Companies have always been able to offshore some work and it's common to have a strategy as to what belongs onshore / offshore, as well as how to manage the offshore work. If a company hasn't looked into it enough to already know what the upsides and downsides area for different countries and skillsets, there'll be an issue. I hope that FD is getting some help; I would hope they'd at least be aware of the different tax and regulations meaning the accountant needs a conversion course (presuming their qualification is with one of the few companies that offers this), as well as the additional costs of running a satellite "office" in the form of statutory reporting in each country, bank accounts, HR support etc etc etc. But yeah, he'll move his one accountancy role to somewhere and it'll be "cheap".

I suppose I would in this situation, as the London weighting is about the additional costs. If people have moved to London for jobs, however, they still incur the higher costs of living and can’t just move, so I don’t see why they should lose the top-up.

In response to the topic up thread, the company DH works for is also giving up the lease on one of their London offices and encouraging all staff to WFH at least three days a work. That is intended to be the new dynamic of their UK operation and not just until COVID is over. Previously, the company had been fairly anti-WFH, but now they’ve seen it works, it saves them money. As others have said, it’s not great for the young employees, or those who live alone, but it massively improves quality of life for many others who have previous experiences long commutes etc.

The situation in London has been ridiculous for a long time. Staff pouring in from all over the place because they can't afford to live in London. Wages haven't really gone anywhere in a long time but everything else has gone up. So you pay through the nose to cram onto a train, pack a lunchbox because you can't afford to buy lunch and sit all day in a London office before you drag yourself back home again. So yes, I'd be interested in the alternatives.

Companies have been offshoring for a lot time. Usually the numbers look good but the reality isn't quite as rosy when it comes to delivering services. Why do you think some of the banks brought their call centres back?

@Hingeandbracket but cost of living is much cheaper in Romania & english is very well spoken & understood by most Romanians. I'm just saying if loads of jobs are outsourced to Romania why wouldn't people emigrate to get a job in a country with a lower cost of living.

My parents like many others are immigrants so it's not a strange concept to me.

@notimagain well for some but remember in London at least 37% of the population was born outside of the UK & then there are loads like me born here but to foreign parents.

Wages haven't really gone anywhere in a long time but everything else has gone up.

Yep one of the legacies of the 08 recession & Im sure we will see wage suppression again.

Tbh I don't think we will see a huge switch to offshore, maybe a small increase. Lots of people who work in desk jobs already have the option to work remotely it's just now likely to increase. So 1-2 days a week in the office. There needs to be a balance younger & newer workers won't necessarily have the space to work from home & need the opportunity to build relationships, train etc.

I agree with @anonm, it'll be a mixed approach. That will still have a huge impact on serviced offices, sandwich shops, even bars in the city. Many of them will struggle to survive the couple of years for things to settle and see how the land lies.

Yes @MRex it will have a massive impact on the industries that support office life unfortunately. The switch has probably happened 10-15 yrs faster & virtually overnight so lots of companies don't even have the opportunity to evolve.

@GiddapGreyWaynesKeat

London weighting should be abolished. It distorts the market and lured more people into the over crowded south east.
Nobody who works from home should be entitled to it

Absolute nonsense. there are people in London who grew up here and rely on that for the extra cost of living in London - it was never just about rail fare.

It really amazes me when people take such a simplistic view to things that have such a consequence for people's lives. Unbelievably facile comment to make.

I've seen some serviced offices desperately pleading "ask us about flexible space if you're giving up your lease", it's really sad. Maybe they'll be able to take on companies who are giving up big office blocks and survive that way. Then those blocks become flats / hotels?

Not sure if I read it here but I think Hof in Westfield may become office space.

@serenada people often forget many Londoners are born & raised & have ties other than work to the city.

Didn't Facebook say to workers if you work remotely, pay will be linked to your location? San Fran is ridiculous though, a family member was renting an $11,000 home (work was paying). The home was pretty average!

My DH is desperate to wfh but still has 2 years left on a lease. He doesnt mind commuting even most days for meeting clients etc just doesnt want to pay a massive amount for permanent premises when he could do 80-90% from home

I think this will become more of an issue where companies have multiple offices around the country. In my workplace staff in London get £3k more to do the same job as staff in other parts of the country. Because they are based in London.
Once they start WFH then the argument would be why are they getting that extra money when people in the midlands and north don't get it. If you use the argument homes are more expensive can someone in the north with a large mortgage then argue they should get it as their home costs are more expensive?
It is something that will have to be carefully considered to make sure they get it right. I for one will argue that it is unfair.

@anomn

well for some but remember in London at least 37% of the population was born outside of the UK & then there are loads like me born here but to foreign parents.

Ah yes, , I'd best not risk taking this topic off down a "B" word rabbit hole but that's a good point.

I am not trying to make a distinction between those born in London and those living/working here from other places rather that it is the overall cost of living tht is higher than elsewhere - even in the suburbs. The London weighting doesn't even come close to that plus the sheer size of the city - you cannot compare London to say, Manchester let alone, Bolton - why would you expect the salary to be the same. Flattening everything doesn't work - it just disproportinately disadvantages the already vulnerable and advantaged those who already privileged.

@Monsterpage

I think this will become more of an issue where companies have multiple offices around the country. In my workplace staff in London get £3k more to do the same job as staff in other parts of the country. Because they are based in London. Once they start WFH then the argument would be why are they getting that extra money when people in the midlands and north don't get it. If you use the argument homes are more expensive can someone in the north with a large mortgage then argue they should get it as their home costs are more expensive? It is something that will have to be carefully considered to make sure they get it right. I for one will argue that it is unfair.

But it's the general higher cost of living. When a fairly average two bed flat in Manchester costs half a million pounds it's maybe comparable. It's not like the people with massive mortgages in London are living in palaces.

When I moved from Nottingham to London I went from paying £450pcm for a two bed flat to £725 for a room in a flat share. And everything else is more expensive as well. It's really not just commuting.

We've got no real space to wfh, we can't afford an office. (And we can't move anyway as the flat is covered in flammable cladding). I guess what I'm saying is it might be fine to advertise remote jobs across the country without lwa and people can choose to apply to them but you can't cut peoples salaries because they don't have to come to a London office when they have already got their (very expensive) lives set up in London because that's where all the jobs in their field are/were.

Of course it would have been better if the government had tried harder to encourage business to set up in other cities and prevent this London bubble effect a bit but they never seemed very interested in doing that.

I lived in London for 22 years and now live in the North. I pay over £150 a month more in my council tax for a property in the same band as my home in London. My water rates are twice as much. I get less choice when it comes to broadband than when I lived in London so pay more. There are many places up here that are very expensive too and plus the transport networks are worse so we often pay more for travel and parking etc. My bills are more up here than they were in London.
I think if a company is based just in London it won’t be an issue - once you look at companies with bases in many places in the UK where the staff are working from home the London weighting argument becomes harder to manage.
Companies will have to have a long hard think and probably discussions with employees about the fairer way ahead.

I think it depends, friends relocated to Bristol & Manchester (5 yrs ago). They did take salary cuts but not a huge amount (GP, teacher, accountant). They have a much better standard of living & much more property for their money.

The area of London I grew up had most people owning homes in normal jobs & often with only 1 parent working. Now these homes are 1m plus & you need not only a great job but a hefty deposit.

@serenada sorry i misinterpreted your post.

@anonm

London weighting relates to the cost of housing and living expenses, not the cost of commuting.

The problem with london weighting is that someone will have based their lifestyle according to what was on offer, and what was required when they took the job.
On the same salary person A might have decided to buy a small but expensive flat in zone 2 with small commuting costs and a quick journey to work, but compromised on space.
Person B might have bought a large house outside the m25 and spend 3 hours a day and a hefty chunk of their wages on a season ticket.
Person A will be worse off if they say now your salary is cut by £x as they wont have saved much by not commuting and will prob have less space at home to wfh.