Why Teleworking Is Here To Stay

Teleworking, a previously underused tool, became the norm for many people during the COVID-19 pandemic. Whilst some companies (in Luxembourg but also around the world) had already put in place a teleworking policy, allowing employees to work one or two days per week from home if needed, many had to switch to remote working overnight as lockdowns were enforced and almost everyone who could carry out their work from home was asked to do so.

The Chronicle.lu team, for example, had been working remotely since long before the COVID-19 pandemic. In this sense, at least, the health crisis was not as disruptive to our daily operations as it was for some other companies – although we certainly missed attending and covering events. Conversely, the pandemic and resulting introduction of mass teleworking helped me personally to improve my own work-life balance as people came up with new tips and tricks on how to make the most of working from home, preserving productivity AND the ability to disconnect, to separate work from leisure and family life.

A survey carried out by STATEC, Luxembourg’s national statistics portal, found that 52% of employees in the Grand Duchy teleworked during the lockdown in the second quarter of 2020 – a historically high percentage, and the highest in Europe at that time. By the fourth quarter of 2021, this percentage had dropped to 38%, but remained higher than pre-pandemic figures (20% in 2019). However, this depended on the sector and nature of work, for instance teleworking was much more common in the financial and ICT sectors, as well as public administration, than it was in the hospitality, transport, health and social care sectors.

To facilitate teleworking in those sectors where it was possible, the tax and social security authorities in Luxembourg and the neighbouring countries of Germany, France and Belgium announced various agreements aimed at facilitating this practice among cross-border workers. Whilst said agreements were scheduled to expire at the end of June this year, the Administrative Commission for the Social Security Systems of the European Union (EU) recently decided to set up a six-month transitional period starting on 1 July (until 31 December 2022) during which cross-border workers can continue teleworking without risking any changes to their social security affiliation in the event of exceeding the 25% threshold provided for by European legislation. However, this transition period does not (yet) apply to taxation, meaning that German residents employed in Luxembourg are once again restricted to nineteen days of teleworking without tax implications, whilst French and Belgian residents are limited to 29 (expected to be increased to 34 in the near future) and 34 days respectively.

Whilst such limitations may make sense from a fiscal point of view, they will certainly have a negative impact once again on traffic in Luxembourg and thus CO2 emissions. As reported by STATEC, almost half (46%) of employees in Luxembourg in 2021 were cross-border workers, i.e. over 212,000 employees (more than half of which resided in France) out of a total workforce of 458,000. This means that over 212,000 people cross the border daily for work, many of whom are travelling by car. Indeed, Luxembourg’s Economic and Social Council (ESC) recently called for an improvement of the legal and fiscal framework for cross-border teleworking as part of its published opinion “For a coherent development of the cross-border metropolis of Luxembourg in the Greater Region”. Hopefully such demands will bear fruit.

On the other hand, mass teleworking during the pandemic has undoubtedly had a negative impact on commerce, particularly in the capital. For instance, if everyone works from home on average one day per week, that means there is a 20% reduction in the number of people in Luxembourg City, i.e. 20% fewer people looking to dine out in restaurants or cafés or go to the gym during their lunch break or after work. This could, however, mean a growth in the number of such establishments in suburbs, towns and villages. This situation also appears to be easing as more and more people return to the office…

However, whilst there are some people who still want to go into the office every day and others who cannot work from home due to the demands of their job, some of us are perfectly happy with teleworking at least a few days per week (provided we have the right to disconnect, but that is the subject of a future opinion piece) and saving time and money on commuting. And if that means reducing traffic and our carbon footprint in the process, all the better!

In fact, a survey published by the Organisation for Economic Co-operation and Development (OECD) in December 2021 found that managers and employees in 25 countries (including Luxembourg) had an overall positive experience with teleworking both in terms of company performance and personal wellbeing. Such studies (and there are many) appear to dispel long-held doubts over the productivity of people who work remotely.

And so, whilst I do sympathise with people who were forced to telework during the pandemic and felt isolated because they live alone or simply cannot or do not want to work from home, I do believe companies (and governments) should learn from the lessons of the pandemic and continue to offer greater flexibility (and thus an improved work-life balance) to their employees. Some companies are already offering more teleworking days per week to their employees (although fiscal challenges remain for cross-border workers), whilst others have set up offices near the border in Luxembourg to avoid employees having to travel into the capital during rush hour. There are many options to explore. What is certain, however, in my opinion, is that the future is hybrid and teleworking is here to stay.