Out of sight, out of mind

The COVID-19 pandemic resulted in an increase in remote and hybrid work that has many managers concerned about declining productivity levels. Here we examine the latest buzzwords associated with the trend, how executives and employees are coping in this new environment, and whether “stealing time” is a fraudulent act.

Recent articles from The Wall Street Journal, Harvard Business Review, The New York Times, Gallup and many others have sounded the alarm over productivity shortfalls and underperformance. The debate around productivity has become more relevant than ever as companies struggle to maintain employee efficiency in a remote-work setting. While some argue that working from home can lead to improved productivity due to reduced distractions and increased flexibility, others believe that it may result in decreased collaboration and communication among team members.

Last September, a Microsoft survey of 20,000 knowledge workers worldwide suggested that a significant disconnect exists between the number of employees who feel productive and the number of managers who believe their people are productive. (See “Hybrid work is just work. Are we doing it wrong?” Work Trend Index Special Report, Microsoft.com, Sept. 22, 2022.) The survey found that 85% of leaders expressed difficulty in being confident about their employees’ productivity since the shift to remote and hybrid work. In addition, 87% of workers think they’re doing okay, but only 12% of bosses are totally sure their crew is getting stuff done.

While this may seem like a simple miscommunication issue, there’s more to it than meets the eye.

What’s contributing to this paranoia?

There are several workforce trends that complicate assessing valid productivity measures: absenteeism, presenteeism, burnout, quiet quitting and so-called side hustles. Each of these factors offers different variations by industry and occupation.

Absenteeism: Workplace absenteeism refers to time taken off work due to illness or other reasons, such as childcare or transportation issues. A 2003 article in the Journal of the American Medical Association (JAMA) found that less productive time was lost from people staying home when ill than from them showing up but not performing at full capacity. (See “Lost Productive Time and Cost Due to Common Pain Conditions in the US Workforce,” by Walter F. Stewart, et. al, JAMA, Nov. 12, 2003.) Absenteeism is more pronounced in customer-facing occupations, like retail, health care and restaurant/food services.

Presenteeism: The generally accepted definition of presenteeism is when people who are ill, injured, or otherwise physically or emotionally impaired opt to show up at work rather than stay at home. Presenteeism impacts productivity at a rate three times that of absenteeism, and research conducted in the early 2000s estimated it cost the U.S. more than $150 billion annually in lost productivity. (See “Presenteeism: At Work — But Out of It,” by Paul Hemp, Harvard Business Review, October 2004.)

The indirect costs of medical issues brought to work by individuals could be much higher, however. That’s because organizations don’t necessarily monitor what are common medical issues among employees (for example, seasonal allergies), which often occur during their most productive years. Employers have historically been blind to these costs. Unfortunately, you can’t measure what you don’t track.

Burnout: The COVID-19 pandemic created a shift to remote work and increased demands on essential workers, many of whom are experiencing burnout at an alarming rate. Burnout, a state of emotional exhaustion caused by prolonged stress and unhealthy coping strategies, can have damaging effects on mental and physical health. Such conditions mean a rise in levels of absenteeism and presenteeism, according to Dr. Matthew Chow, psychiatrist and chief mental health officer at TELUS Health. (See “The link between mental health and productivity in the workplace,” HRD, TELUS Health, News, June 5, 2023 and “The State of the Global Workforce: 2023 Report,” Gallup.com.)

One pre-pandemic study revealed that full-time remote work increased a sense of loneliness by 67% when compared to in-office work, according to research by organizational psychologist Lynn Holdsworth. Employee engagement is the basis for enhancing mental well-being in the workforce. After all, we thrive in communal settings because we’re social creatures. (See “Are remote workers lonely? Probably — and experts warn it has damaging side effects on productivity, engagement, and progression,” by Orianna Rosa Royle, Yahoo.com, March 14, 2023 and “The Best Management Secrets for Impacting Employee Mental Health,” by Dan Witters and Sangeeta Agrawal, Gallup.com, Workplace, Dec. 16, 2022.)

Quiet quitting: Psychological disengagement from work, also known as quiet quitting, occurs when an individual is physically present or logged into their computer but lacks a strong sense of intrinsic motivation or direction. It’s a non-illness form of presenteeism. Moreover, quiet quitters often don’t engage with their co-workers, managers or the organization. Low productivity from actively and passively disengaged employees — and those who are quiet quitting — represents $8.8 trillion in untapped productivity opportunity, according to Gallup. (See “Globally, Employees Are More Engaged — and More Stressed,” by Jim Harter, Gallup.com, Workplace, June 13, 2023.)

The problem with side hustles

So-called side hustles or side gigs are second jobs or entrepreneurial endeavors. Most company employment policies demand 100% focus and attention from employees when “on the clock,” but many companies also allow part-time jobs so long as they don’t “substantially” interfere with their primary job.

That fuzzy HR language raises the lid on Pandora’s productivity box even higher. A January survey by ResumeBuilder.com found that a majority of fully remote U.S. workers had a second job. Of the 1,250 respondents to the survey, 69% reported having an additional source of income outside their primary employment. This number is markedly higher than the percentage of Americans with side hustles in general, implying that remote work may be boosting a rise in gig economy activity. (See “7 in 10 remote workers have multiple jobs,” ResumeBuilder.com, updated Jan. 19, 2023.)

The survey also found that a significant portion of remote workers (37%) were engaged in freelance or contract work as their second job. These numbers indicate not only an increase in gig work but also highlight the double-edge sword of remote work. Workers may have greater schedule flexibility and control, but they’re wrestling with which job to prioritize.

Working a side gig can certainly splinter employees’ attention, focus, effort and time. As ancient wisdom reveals, no one can serve two masters, as eventually one will be loved and the other despised.

Time bandits

Certain situations with presenteeism, remote work and employees working second jobs or having side gigs can violate stated company policy, relevant laws and regulations about outside employment. That’s why it’s important for workers to disclose any other work to employers, as there may be legal implications for not doing so. While most employers don’t prohibit side hustles, they often restrict the type of work one is able to do so that it doesn’t pose a competitive issue or conflict of interest. Employees caught violating company policies on outside work are often fired on the spot.

Having several jobs could cross the line into so-called time theft, which involves employees being paid for hours they didn’t work and impacts nearly 75% of businesses in the U.S., as reported by the American Payroll Association (APA). This type of theft can also occur when someone clocks in another worker (known as “buddy punching”), through personal activities on company time, or when work hours are maliciously recorded inaccurately (late starts/early finish). Whether remote work is paid hourly or by salary, time theft represents a contributing factor to the productivity paranoia many managers experience. Some studies have put the cost of time theft for U.S. employees at a staggering $400 billion annually. (See “Employee Time Theft Facts and Stats,” EPAY Systems, Sept. 16, 2014.)

On the use of time as a misappropriation of resources, Paul Dunlop, MPS, COO, of Fraud Doctor LLC, explained to Fraud Magazine that, “It’s less an issue of absolutes and more one of risk management across many angles. Insufficient organizational control and preventive stance can quickly draw liability to the employer.”

But is it fraud?

“It could be, if there’s an economic substance — a materiality — to the fraud, such as a kickback or bribe,” Robert Nordlander, CFE, host of The Fraud Fighter Podcast, tells Fraud Magazine. “Otherwise, the actions don’t amount to more than a workplace violation. It’s best to have policies in place to define what is or isn’t tolerable and how the company will address infractions.”

Arguably any such violation would be prosecuted under the “honest services fraud” federal statute 18 U.S.C. §1346, which involves any plan to deprive someone of their intangible right to honest services by breaking a fiduciary duty through bribery or kickbacks. Fiduciary duty refers to the obligation to act solely for the benefit of the public, an employer, shareholders, or a union. (See “18 U.S.C. §1346: What is Honest Services Fraud?” Azhari LLC.)

Trust issues and productivity paranoia

According to the Microsoft survey, the real problem lies in something much deeper — trust. This chasm of mistrust is cause for concern, generating what’s been termed “productivity paranoia.” Most managers continue to struggle with digital overwhelm — trusting their remote employees to be as productive as they claim.

Even after several years of productive work-from-home and hybrid arrangements that predated the COVID-19 pandemic, many managers remain skeptical of productivity claims from surveys and research. They just don’t buy the numbers. Yet, moving to long-term hybrid work arrangements is what 60% of 8,090 remote U.S. workers prefer, according to a recent Gallup poll. (See “Returning to the Office: The Current, Preferred and Future State of Remote Work,” by Ben Wigert and Sangeeta Agrawal, Gallup.com, Aug. 31, 2022.)

While it may be difficult to shift deeply embedded management attitudes, what might be a better (and easier) approach is to reframe how organizations define and measure productivity. It doesn’t appear that hybrid and remote work arrangements are going away any time soon, so setting aside historical productivity metrics (using physical visibility cues to perceive productivity levels, for example) for results-based management may help both workers and managers. Gallup CEO John Clifton sums up the issue simply: “Change the way your people are managed.”

Hybrid work: The best of both worlds?

Do hybrid arrangements offer the best option? While many organizations sing the praises of hybrid work environments, some see it as productivity purgatory with both pros and cons. Others, like Elon Musk, consider the office as the “mothership of productivity” and there’s stronger support for a return to the office coming from all directions. BlackRock CEO Larry Fink thinks falling productivity and rising inflation is the fault of remote work. (See “BlackRock CEO Larry Fink blamed remote work for falling productivity and rising inflation …,” by Nicholas Gordon, Yahoo.com, June 15, 2023.)

And still others, such as entrepreneur and “Shark Tank” co-host Kevin O’Leary, sing the praises of remote work productivity. In a CNBC interview on May 29, 2020, O’Leary said, “I don’t care when they work; I care when the task is finished.” O’Leary stated he’ll offer 20% of his employees — especially those in accounting, compliance, and logistics — the opportunity to work from home full time. He’ll even pay for their internet and equipment upgrades. According to O’Leary, many of his employees are working 10 hours a day and “all productivity has gone through the roof.” He expects a 5% to 7% cash flow improvement across all his companies as a result of closing marginal storefronts and productivity improvements. (See “Kevin O’Leary: Remote work will become the norm and it will save companies money,” Squawk Box, CNBC, May 29, 2020.)

The case for face-to-face

There’s a lot to be said for the return-to-office argument. A graphic posted on the “Meetings Mean Business” account of Twitter, now called X, revealed that one hour of face-to-face contact is equivalent to five video conferences, 10 phone calls, and 20 emails.

In addition, 8 in 10 executives prefer in-person meetings to virtual contact, while face-to-face requests are 34 times more effective than emailed ones. An MIT Human Dynamics Lab study revealed that the most valuable communication occurs in person, and typically 35% of the variation in a given team’s performance (i.e., productivity) could be attributed to the number of times team members engaged in face-to-face communication.

Anita McBride, senior advisor to the George W. Bush Institute, states the importance of face-to-face engagement beyond the office: “Face-to-face is one antidote to today’s divided world. By taking the time to meet, and building human connections rather than electronic ones, we’ll undoubtedly bridge our differences more easily — and discover ways to do everything better.” (See “The Antidote to Today’s Divided World: Meeting Face-to-Face,” by Anita McBride, MeetingsMeanBusiness.com, Oct. 11, 2018.)

Return-to-office pushback

Employees have pushed back on return-to-office policies. In May, hundreds of Amazon workers staged a lunchtime walkout in protest of the company’s policies, which highlighted a three-day in-office work mandate. (See “Returning to the office is like getting back with an ex-spouse. It may provide the secret to a happy reunion,” by Quentin Fottrell, MarketWatch, Help My Career, updated June 19, 2023.) The danger is that such executive fiats can induce lower productivity or even a workforce exodus. Indeed, the call to return to the office from a remote or hybrid work setup would be an unwelcome one, and for some, very expensive. The productivity paranoia could then reach deafening decibels.

Rethinking “visibility”

It’s true that being physically visible to others in the office enhances mutual engagement and familiarity. It’s a way for peers and leaders to put a name to a face and become familiar with your work achievements. The adage that one of the secrets to career success is “it’s not who you know; it’s who knows you” still has some validity. But with remote and hybrid work, an even better version is “it’s who knows you and your work.”

Evaluating knowledge worker productivity with old-school visibility metrics is no longer a valid indicator of productivity in remote and hybrid work environments. The “management by walking around” approach doesn’t work anymore because no one’s in the office.

Where do we go from here?

Marshall Goldsmith acknowledges in his book, “Triggers: Creating Behavior That Lasts — Becoming the Person You Want to Be” (Crown Business, NY, 2015), that “People don’t get better without follow-up. So, let’s get better at following up with our people.” Goldsmith believes that productivity arises from stronger engagement between managers and workers, but also for workers to self-engage about their personal responsibility and accountability.

Goldsmith proposes asking a series of daily self-reflective (self-verifying, perhaps) questions in the form of “Did I do my best at (some behavior, task, or attitude)?” Such questions can serve as a check on our intrinsic drive to always strive to do better or become better, whether we’re working at home, in a hybrid arrangement, or in the office full time.

The questions are meant in the spirit of former President Reagan’s admonition to “trust but verify” — or in this case, to self-verify. Again, you can’t measure your own productivity value if you don’t track it.

Creating a productivity trust protocol

Mac Richard writes in his book, “The Trust Protocol: The Key to Building Stronger Families, Teams, and Businesses” (Baker Books, 2017), that establishing a so-called trust protocol is “… forging credibility through integrity and action. It is deliberately demonstrating our dependability to the people with whom we live, work, and serve … it is backing up our talk with our walk. The Trust Protocol calls us to a higher plane of relational responsibility … through intentional interactions that invigorate community and collaboration.”

Overcoming productivity paranoia

Trust is the engine that drives everything — from our relationships to work projects to business ventures. Trust develops in stages. Trust is initiated with mutual familiarity through engagement; it gets stronger when you can articulate how you position your value to others. Trust approaches the tipping point when you have demonstrated influence with others. When others commit to trusting you completely, you’ve converted them into allies, advocates, champions, clients, customers or followers.

When organizations encourage behaviors, attitudes or policies that support employees’ beliefs in any of these empowerment dimensions, they can create an atmosphere that’s ripe for the positive, dynamic effects of higher engagement and greater productivity.

Donn LeVie Jr., CFE, is a staff writer for Fraud Magazine and has presented and served as a career strategist at ACFE Global Fraud Conferences since 2012. He has led people and programs for Fortune 100 companies, the U.S. federal government, and academia for over 30 years prior to his being a leadership influence strategist, award-winning author and speaker. Contact him at donn@donnleviejrstrategies.com.