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Homeworkers paid less than those in the office

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The shift to homeworking is fantastic for enabling flexible working, but could it damage your career prospects or are employer attitudes changing?

Homeworkers are paid less and are only half as likely to be promoted as those who go into the office, according to Hargreaves Lansdown.

The financial firm said the pandemic has caused a boom in homeworking: in 2020 the number who did at least some work from home was up 9.4 percentage points to 36%.

That’s great news for many people who prefer the flexibility, but it could lead to them being overlooked for promotion and being paid less than those who travel into the workplace.

The cost of homeworking

Before the crisis, those who had worked exclusively from home for years were paid 6.8% less than those who never did, according to Office for National Statistics (ONS) figures.

They were less than half as likely to have been promoted between 2012 and 2017 and 38% less likely to have received a bonus from 2013-2020.

However, this might be changing as the pandemic has made homeworking much more acceptable to employers.

Those who had either moved to homeworking recently or who balanced some work at home and some elsewhere, earned 12% more than those who never worked from home and were 35% more likely to have received training.

Recent homeworkers were 42% more likely to get a bonus than those in the office, and occasional homeworkers were 28% more likely.

Gender imbalance

The ONS figures are controlled for gender, but Hargreaves Lansdown pointed out that there are clear implications in the figures for the gender pay gap.

Women are far more likely to have to work flexibly for caring responsibilities than men, so run a much bigger risk of falling into the long-term homeworking bracket, leaving them overlooked and underpaid.

Longer hours

Homeworkers work longer hours than those in the office or workplace – 32.3 per week on average compared with 27.7 hours.

They also work more unpaid hours – with six hours of unpaid overtime in 2020 compared to 3.6 hours for those who work elsewhere.

Homeworkers start later in the day and take more breaks, but they work later into the evening. Their sickness absence rate was lower at 0.9%, compared with 2.2% for those who never worked from home.

Sarah Coles, personal finance analyst at Hargreaves Lansdown, said: “Working from home means you risk being out of sight and out of mind when it comes to pay rises, training and promotion. Long-term homeworkers are being overlooked, and end up overworked and underpaid.

“However, not all homeworkers are equal. While those who have being doing it for years have suffered the consequences, those who have been offered more flexibility recently, and people who still show their face at the office regularly, are actually better off.

“This helps reveal some of the forces at play. People who need to work from home in order to juggle work and caring responsibilities for years, are far more likely to be under-appreciated. By contrast, those who are offered flexibility further into their career, are more likely to have it as a mark of their seniority and expertise. They are being offered homeworking as a benefit in order to retain them, so they’re rewarded accordingly.”