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Dell's plan to restrict remote worker promotions might backfire

Dell's new plan to restrict promotions for full-time remote workers may lead to employee turnover. But research says remote workers have always been at a disadvantage.

Hybrid work is the rule at many firms today, including Dell, which has long encouraged workplace flexibility. But a recent report shows the firm is less encouraging if you work remotely full-time.

In recent years, Dell has championed flexible work as a key component of its corporate culture. But that seems to be changing.

Business Insider recently reported Dell told remote workers they won't get promoted.

Dell, in a statement sent to TechTarget Editorial, explained why it changed its policy. "In today's global technology revolution, we believe in-person connections paired with a flexible approach are critical to drive innovation and value differentiation."

Research in this area says that full-time remote workers have always been at a disadvantage in promotions over in-office or hybrid workers. But why Dell is taking this approach and pulling promotion opportunities from full-time remote workers is a mystery.

One clue might be financial. For the fiscal year, which ended in January, the company reported revenue of $88.4 billion, down 14% from fiscal year 2023.

Citing the overall economy, Jenny von Podewils, co-CEO of Leapsome, an HR platform, sees Dell's remote worker rule as a "panicked" reaction to business issues.

Dell's requirements will create new challenges and problems instead of solving any current business issues, Podewils said. She said that while there might be some short-term productivity gains, the disengagement could outweigh those benefits.

The tech job market

The tech job market has been in flux. While there is strong demand for AI, cybersecurity and some other specialized IT skills, tech firms continue to cut jobs -- 50,000 so far this year, according to The unemployment rate for tech is relatively high and near the national unemployment rate of 3.9%; during good times, it can easily be half of that.

Mark Dinan, a tech recruiter in Palo Alto, Calif., said the harsh reality is that given the unemployment in tech, employers have a huge advantage and leverage over their employees.

"Companies can cut people, give them a nice little severance and hire somebody in 2024 for probably half the price of what it costs to hire somebody in 2019 because of the supply and demand element of tech workers right now," Dinan said.

Dell requires hybrid workers to be onsite at least 39 days per quarter -- on average, about three days a week.

When the tech job market recovers, Podewils said Dell's plan could "have very detrimental effects in terms of retention risks."

It just seems like a very strong oversimplification that this is going to actually solve some of the problems they face.
Jenny von PodewilsCo-CEO, Leapsome

"It just seems like a very strong oversimplification that this is going to actually solve some of the problems they face," Podewils said.

Kimberly D. Elsbach, professor emeritus in the Graduate School of Management at the University of California, Davis, has researched proximity bias, which occurs when people in the office gain a career advantage over those who work remotely.

Remote workers are perceived as less dedicated and committed than in-person workers, Elsbach said.

"To the extent that those perceptions influence promotions and rewards, I would expect that remote employees would be at a disadvantage," she said.

Seeking full-time remote positions carries its risks, according to Elsbach's research. But her work also finds that if employers implement objective measures and evaluate employees on that basis, a proximity bias can be mitigated.

Elsbach agreed that a deduction in line with her findings is that people seeking full-time remote work should inquire during the job interview about how remote employees are assessed.

Patrick Thibodeau covers human capital management and ERP technologies. He has worked for more than two decades as an enterprise IT reporter.

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