Australian workplaces face conflict over office mandates

Recent findings by ELMO Software reveal a substantial disparity between employer-imposed office mandates and employee desires for flexible working conditions in Australia.

The 2025 ELMO HR Industry Benchmark Report, encompassing feedback from 900 HR professionals from Australia in January 2025, indicates a pronounced trend in workplace policies. A significant 77% of HR professionals report mandatory in-office days, whereas only 16% of employees have full autonomy over their hybrid work schedules. Moreover, 39% of the workforce is instructed to attend the office five days a week, suggesting a prominent movement towards traditional office attendance that may not meet employee expectations for flexibility.

Joseph Lyons, CEO of ELMO Software, commented on the findings: "Workplace flexibility has been one of the most in-demand employee benefits in recent years, yet some organisations are moving in the opposite direction. As businesses struggle with productivity concerns and collaboration needs, they must also consider how rigid mandates could impact engagement, retention, and overall workforce satisfaction. While I've seen first-hand the benefits of in-office collaboration, finding the right balance is key to supporting a thriving workforce."

This divergence highlights an ongoing "tug-of-war" between employers and employees. Organisational reasons for enforcing office mandates include the perceived necessity for face-to-face cooperation (14%) and productivity concerns (12%), as well as technological advancements (15%) and a demand for flexibility (12%). Interestingly, 10% cite C-suite preferences as a principal factor, suggesting a misalignment between executive priorities and employee expectations.

Despite the tendency towards in-office mandates, efficiency barriers remain a challenge. A striking 91% of HR professionals acknowledge difficulties in enhancing productivity, with primary concerns being lack of goal and performance clarity (32%), prioritisation difficulties (31%), and ineffective measurement frameworks (29%).

Looking forward, a transformation in workplace policies is anticipated. Acknowledging that only 14% plan to mandate full-time office presence, a majority (66%) foresee policy adjustments – primarily to hybrid work models (49%).

Worker retention issues underscore the significance of work-life balance (30%) and flexible working (26%) as crucial retention drivers. As outlined in ELMO's recent Employee Sentiment Index, flexibility ranks as a top priority, challenging organisations to align business needs with employee expectations to bolster engagement and long-term retention.

Lyons elaborated on the retention challenge: "With talent attraction and retention remaining top challenges, organisations need to carefully consider how their workplace policies shape their employer brand. Employees increasingly expect flexibility, and businesses that don't adapt may struggle to attract and retain top talent in a competitive market."

Comparative data shows Australian companies enforcing stricter office attendance compared to New Zealand, with 39% of Australians expected in the office full-time, against New Zealand's 27%. Conversely, hybrid work is more prevalent in New Zealand (65%) than in Australia (55%), reflecting a broader commitment to flexible arrangements across the Tasman.

Australian firms tend to rely more on productivity rate assessments (47%) than their New Zealand counterparts (39%). Nonetheless, strategic hurdles persist, with 87% of Australian HR professionals recognising operational barriers, exacerbated by limited access to real-time workforce data (38%) and time constraints (37%).

The evolving workplace landscape indicates that 71% of HR professionals across Australia and New Zealand plan to revise workplace policies to better define and gauge productivity.

Addressing the complex issue of flexible work arrangements and its implications for organisational performance, Lyons stated: "With increasing productivity ranked as the top priority for organisations over the next 12 months, business leaders must take a nuanced approach to workplace policies. Rather than enforcing rigid mandates, organisations should focus on data-driven strategies that balance flexibility with business performance, ultimately fostering an environment where both employees and employers can thrive."