Work From Home Under Fire As Disney CEO Sets Office Mandate

Full-time remote work may be the wave—or hope—of the future, but it will soon be a thing of the past at yet another big company that cracked down on pandemic-fueled telecommuting.

Walt Disney (DIS) CEO Bob Iger informed Disney's corporate employees this week that they'll need to be at the office at least four days a week starting March 1. Companies including Apple (AAPL) and Goldman Sachs (GS) have sought to curtail work from home in recent months, saying it isn't an adequate replacement for in-person collaboration.

"In a creative business like ours, nothing can replace the ability to connect, observe, and create with peers that comes from being physically together, nor the opportunity to grow professionally by learning from leaders and mentors," Iger wrote. The CEO returned in November to the post he held until 2020, after Disney's board fired his estranged protégé, Bob Chapek.

Apple has insisted since September that employees spend three days a week in the office. CEO Tim Cook has defended the policy amid complaints from some workers. "We make product, and you have to hold product. You collaborate with one another because we believe that one plus one equals three," Cook has said.

Goldman Sachs CEO David Solomon says the rise of remote work threatens the company's culture and cohesion. Goldman's diminished tolerance for telecommuting had boosted the firm's office attendance rate to 65% on average as of October, though that remained short of 75% before the pandemic.

Even companies seeking to bring employees back to the office have accepted an expanded role for remote work in hybrid arrangements. Apple's policy "doesn't mean we're going to be here five days a week, we're not," Cook told CBS. "If you were here on a Friday, it would be a ghost town."

According to the U.S. Census Bureau, more than 27 million Americans accounting for 18% of the labor force worked primarily from home in 2021, triple the number in 2019. Millions more have shifted to hybrid arrangements allowing them to work from home at least some days, driving down office occupancy rates in major U.S. cities.

Kastle, a facilities security provider that estimates office occupancy rates based on access data from 2,600 buildings in 47 U.S. states, says occupancy in the top 10 U.S. office markets is down more than 50% since the start of the pandemic.

The effect has been particularly dramatic in San Francisco, where Salesforce (CRM) offered workers the option of fully remote work in 2021. By late 2022, the software giant began requiring sales staff to work from office three days a week.  “Even at Salesforce we have what I would call factory jobs—folks that are required to be here,” Salesforce CEO Marc Benioff told Bloomberg. “But we’re never going back to how it was.” Benioff has also reportedly told employees he suspects remote workers may be less productive.

In many cases, companies have found remote workers are at least as productive as the office staff, while requiring lower overhead for office rent and other costs. Tesla (TSLA) and Twitter CEO Elon Musk, a longtime critic of work from home who initially banned the practice at Twitter, appears to be among the latest converts, at least on the short-term basis. After Twitter recently closed its Seattle offices, the company reportedly told workers there to telecommute.

Among the most enthusiastic supporters of work from home is the U.S. government, the country's largest civilian employer after Walmart (WMT) with 2.1 million workers. Telework has increased engagement among federal government workers and is increasingly driving job changes in government employees, Office of Personnel Management (OPM) Director Kiran Ahuja told a congressional committee last year. "What we are seeing is agency-hopping, based on where employees see the level of flexibility," Ahuja said.