Amazon is running into a problem with its 2025 return-to-office mandate: The e-commerce giant doesn’t have enough space for everyone.
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Thousands of employees in at least seven cities have been told they are temporarily exempt from a mandate to return to the office full-time that is set to take effect in January. Return dates for some staff could be pushed back as far as May, according to Bloomberg and Business Insider.
Employees at offices in Austin, Dallas, Phoenix, Atlanta, Houston, Nashville and New York are having their return-to-office mandates eased, according to various reports. An Amazon spokesperson told Bisnow that the vast majority of employees would be welcomed back on Jan. 2.
Some Amazon employees have chafed at Amazon’s return-to-office policies and the firm has pushed employees for more than a year to relocate closer to its corporate hubs.
Under the current policy, which mandates three days of in-office work, workers have complained to Bloomberg about being forced to share desks and a lack of available conference rooms.
Amazon is focused on reconfiguring space to accommodate the new full-time mandate as opposed to significantly growing its footprint, a source familiar with the company’s plans said.
The corporate giant has more than 350,000 corporate employees worldwide, mostly in the U.S., and a total workforce of 1.5 million people.
CEO Andy Jassy wrote in a memo to employees announcing the full-time in-office policy that the company believed “that the advantages of being together in the office are significant.”
The company occupies roughly 30M SF of office space in North America, according to its most recent annual report. Its recent real estate strategy has varied from city to city.
Amazon iced plans for a 3.2M SF expansion of its second headquarters outside Washington, D.C., and said in March that it would save $1.3B in costs by slimming its footprint.
But the firm is also reportedly in talks to lease 350K SF at 452 Fifth Ave. next to its New York City headquarters, and it is looking for a smaller 50K SF footprint in Miami, where founder Jeff Bezos moved last year.
Amazon has joined other Fortune 500 companies in pulling employees back to the office full-time, but recent data suggests that mandates could negatively impact operations, at least in the short term.
Businesses that allowed for flexible work grew their headcount by 1.6% since June 2022, compared to just 1% for firms requiring entirely in-office attendance, according to data from Revelio Labs that found that return-to-office mandates create “abnormally high turnover.”
“Our study highlights brain drain as a significant cost of RTO mandates, even for the largest firms in the world,” the researchers wrote.
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