Millions of employees preparing to work from home this winter will face a collective hike of almost £2bn on their energy bills, and tougher working conditions, with only a “pittance” in compensation from their employers.
Half the UK’s workforce is likely to work primarily from home over the coming months as they help to contain the spread of the coronavirus, and may see their winter energy bills rise by a fifth as radiators and boilers are kept running through the day.
The average household energy bill could climb by £107 this winter for those working from home five days a week, according to a study by Energy Helpline, which would mean a £1.9bn hike for the energy bills of working households between October and March.
But under existing government rules, workers are guaranteed compensation for remote working costs worth less than a third of the expected energy bill rise via tax relief from HMRC, or between £1.20 to £2.40 a week.
The rising cost of working from home has raised concerns among unions and fuel poverty campaigners who fear that workers could face mounting debts alongside tougher working conditions and extra expenses to set up home-based workspaces.
Mike Clancy, the general secretary of trade union Prospect, said: “Our worry is that the next phase of home working will be defined by some employers outsourcing the costs to their staff.”
Home workers could face a winter of “hidden overtime” and the “pressure to work all hours” alongside higher utility bills, caring responsibilities, or mental health issues triggered by isolation at home, he said.
Peter Smith, a director at fuel poverty charity National Energy Action (NEA), said that while some people will be able to offset the higher cost of their energy bills with savings on their usual travel costs, others on low wages will struggle.
“This could lead to increased affordability issues, more energy debt or even energy rationing, which can be dangerous all year round but particular during colder weather,” he said.
Many households may already be in energy debt, according to Energy Helpline, which could be up to £94 per household, or £2bn nationwide. These homes could face the prospect of debt collectors chasing up unpaid bills after the energy industry regulator told suppliers in June that they no longer need to offer unlimited coronavirus payment holidays to struggling customers.
Under existing government rules, employees who are asked to work from home can request a £6 a week allowance from their employers to cover these extra costs, but there is no statutory obligation for employers to agree.
Employees could also seek tax relief from HMRC on the £6 allowance, which for most people paying a basic rate of tax would amount to £1.20 a week compared with a likely energy bill increase of more than £4 a week.
Employees can claim tax relief above the £6 flat rate “if they keep records and can evidence them,” according to a government spokesman.
Smith said: “It’s a pittance unless you provide all your bills, which many people don’t know how to do or won’t have time for on top of so many other pressures.” He urged the government to make it a legal requirement for employers to provide a basic work from home allowance.
“We are hoping the government is seriously considering these steps and others like providing more support for bill rebates through existing schemes for the poorest households,” he said.
Prospect warned that there is also a risk that “bad employers” will take advantage of remote working to “further isolate staff or cut benefits, knowing that it is more difficult for some workers to get together to raise concerns”.
“Full transparency about the risks and costs of working from home is essential, and dialogue with trade unions is the most effective way to get this right,” said Clancy. “The challenge is to ensure that the post-pandemic recovery builds on the benefits of flexible working rather than hardwires in inequality.”