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283 points belter | 45 comments | | HN request time: 2.324s | source | bottom
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no_wizard ◴[] No.42130354[source]
For a company that is supposedly data driven like Amazon likes to tout, they have zero data that RTO would provide the benefits they claim[0]. They even admitted as much[1].

I wouldn't be shocked if one day some leaked memos or emails come to light that prove it was all about control and/or backdoor layoffs, despite their PR spin that it isn't (what competent company leader would openly admit this?)

[0]: https://arstechnica.com/tech-policy/2024/10/over-500-amazon-...

[1]: https://fortune.com/2023/09/05/amazon-andy-jassy-return-to-o...

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1. tpurves ◴[] No.42130821[source]
They'll have plenty of data to support the primary motivation: that enforcing arbitrary RTO policies will absolutely aid in generating staff turnover and voluntary attrition without having to payout severance costs. The policy gives them less direct control over who they lose, but I'm sure the data also points to any critical replacement employees being willing to work for less on average. That's the data they are looking at.
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2. regularfry ◴[] No.42130938[source]
I wouldn't be surprised if it's even more straightforward than that. They've got some very expensive office space that's extremely under-utilised, and they're probably at risk of the rent getting raised on a lot of it unless they can increase footfall.
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3. heavyset_go ◴[] No.42131024[source]
Agree with this, but do want to let employees know that if this happens to them, that changes in working conditions can be considered constructive dismissal even if you quit.
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4. ghaff ◴[] No.42131029[source]
If you have way-underutilized office space that you can sell or not renew leases on, you can shed it like a former employer was doing when I left. Otherwise, there's basically no value in how many or few people are filling the space unless they're actually delivering some business value to the entity paying for the lease. (Unless, maybe, it relates to promises made to some local jurisdiction that gave you tax breaks.)
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5. nateglims ◴[] No.42131055[source]
I think it's even more basic: they think it will be just like it used to be before 2020.
6. neilv ◴[] No.42131137[source]
> they're probably at risk of the rent getting raised on a lot of it unless they can increase footfall.

Raised, because the property owner has other investments that are affected by the presence of people, such as nearby restaurants and stores?

Or is a valuation of the office property itself affected by how many people are physically in the building or area?

7. umeshunni ◴[] No.42131147[source]
That makes very little economic sense.
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8. hansvm ◴[] No.42131172[source]
Yeah, that only buys you unemployment though, not severance (which is typically much greater but comes with an NDA of some kind).
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9. schmidtleonard ◴[] No.42131222{3}[source]
It makes sense if a counterparty extended Amazon a benefit in exchange for driving foot traffic and now the benefit is at risk because they are not driving the foot traffic.
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10. refulgentis ◴[] No.42131265[source]
I don't understand, like, I can see each handwave -

1. They're paying a lot in rent.

2. if they don't have workers in the office, then, adjacent spaces for ex. food service is less valuable.

3. If adjacent space is less valuable, the landlord is motivated to raise Amazon's rent to compensate

4. Therefore, they're making people go back to work to avoid rent increases

4 years on, and it seems a little bit odd it took that long for it to play it. But it seems (much) cheaper and sensible to find somewhere else to rent than give in to a threatening landlord who sees you as responsible for any shortfalls in adjacent revenue, instead of the anchor tenent you are.

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11. reaperducer ◴[] No.42131296{3}[source]
If adjacent space is less valuable, the landlord is motivated to raise Amazon's rent to compensate

Real estate is very much driven by supply and demand. Moreso than many other industries. If the adjacent space is less valuable, it gives Amazon leverage to lower its rent.

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12. regularfry ◴[] No.42131314{3}[source]
A lot might depend on how long a lease was signed, and what penalties there might be for breaking it.
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13. ghaff ◴[] No.42131331{4}[source]
Sure. Breaking leases have costs. But the cases I have some direct experience with are generally simply not renewing them.
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14. galleywest200 ◴[] No.42131386{5}[source]
For what it is worth, Amazon has built (as opposed to just rent) very large buildings in Seattle, WA and Bellevue, WA. It could be a sunk-cost fallacy sort of deal going on here. They even built giant ~~testicles~~ glass spheres with plants in them.
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15. jacobr1 ◴[] No.42131443{4}[source]
subleasing is an option, though demand is down across the board
16. dgfitz ◴[] No.42131757{6}[source]
I don’t think I buy that answer. They’re on the hook for the money either way. Ego?
17. therockspush ◴[] No.42131832{4}[source]
You're right about Amazons leverage.

In Santa Clara county we have our local behemoths trying to get their property valuations dropped. https://www.bizjournals.com/sanjose/news/2024/11/08/tech-goo...

The way commercial real estate lending is tied to lease rates usually means its almost impossible for them to go down unless you operate at these scales.

Most commercial landlords around me would rather have prime main street spots stay empty than refinance because of lower lease rates.

18. heavyset_go ◴[] No.42131846[source]
The ownership class has stake in commercial and prime residential real estate. You don't have to look further than that.
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19. underlipton ◴[] No.42131858{3}[source]
That's assuming no corruption involved, which would be weird, given the previously-mentioned circumstances. Who stands to lose if the building is sold at a loss or the lease isn't renewed? Are they connected to the executives pushing the RTO decision in any way? It need not even be a direct connection. Who's got CRE MBS in their portfolios? Whose friend does?
20. hn72774 ◴[] No.42131916{3}[source]
Amazon owns most of its downtown Seattle real estate.

Low occupancy means balance sheet write downs, and higher cost of capital.

21. notyourwork ◴[] No.42131917{6}[source]
They lease a lot of buildings too. Paul Allen owned a bunch of the area.
22. grugagag ◴[] No.42131998{3}[source]
I speculate this is part of it, and this is tied to a lot of key people who can enforce this type of move. Big companies also want to legitimize their business by having a presence. Without any presence virtually anyone start competing them, chipping at their business.
replies(1): >>42134903 #
23. sparky_ ◴[] No.42132040{3}[source]
Man, nothing makes you appreciate EU labour protections like reading the HN comments.
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24. unsnap_biceps ◴[] No.42132339[source]
They absolutely have the ability to make exceptions for the critical people that they don't want to leave. I am aware of a few L7s that have permanent exceptions for WFH beyond the new year because of them being very critical to specific projects.
25. samtho ◴[] No.42132726[source]
Amazon also has mastered the art of getting cities to bend over backwards for them, offering tax breaks and land because Amazon wants to bring X number of jobs that pay over $100K/year to the city. Well, now these offices are vacant and the high paid workers are not even in the city like Amazon promised. The cities that helped Amazon foot the bill for their offices are not super happy and want either the results they promised or for Amazon to pay back what the city had invested.
26. nradov ◴[] No.42132795{4}[source]
Man, nothing makes me appreciate USA labor laws like reading the HN comments. I (unironically) love how it's easy to get a job here; since firing is easy, employers are more willing to take a chance on hiring someone. Plus it would suck as an employee to be forced to give your employer 4+ weeks of notice if you want to resign. Whereas in the USA with at-will employment we can quit tomorrow with zero notice and suffer no financial penalties.
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27. nradov ◴[] No.42132814[source]
Huh? I've never seen a commercial office space lease that had rent increase terms based on "footfall". You're not making any sense.
28. Dr_Birdbrain ◴[] No.42132911[source]
I’m not familiar with this—why would the rent be related to the amount of footfall?
29. ◴[] No.42133161{4}[source]
30. hansvm ◴[] No.42133417{4}[source]
I'm mostly with you in general. Especially for the amount we pay in taxes, we really ought to have better protections for vulnerable people.

For me in particular, if I were fired a year into every job and had to be unemployed for ten, counting all the health insurance bullshit and whatnot you have in this country when you're unemployed, I'd still be better off financially than in any EU tech job I've found. HN isn't exactly a representative sample of the sort of people who benefit from EU labour protections.

31. ryall ◴[] No.42133483{5}[source]
Must be nice to work under the eternal threat of being laid off on a whim.
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32. nradov ◴[] No.42133687{6}[source]
It's nicer than the alternative.
33. DanielHB ◴[] No.42134817{5}[source]
I have worked both in the EU and in Brazil and I do have to say that the Brazilian system is better. Labor protection is high (25 vacation days, guaranteed overtime pay, etc), but companies can still fire people. However doing so involves paying severance proportional to how long you been at the company.

When you leave a company you need to give one month notice (so you can't just get up and leave). I never seen a "layoff" (you get notice that you are leaving, but still have your job for a few months and usually no severance) like they do in the EU. When you are fired, you are out of there the same day with your severance and unemployment benefits.

This specific practice does have a few problems:

1) companies not firing about-to-retire employees who have been at the company for 10+ years because of the huge severance required. Instead they just wait for them to retire. However employees also really don't want to get fired in their last few years either before retirement because of how the pension system works, so it balances-out. 60+ year old people usually take it easy, but they are usually not just showing up for a paycheck.

2) Younger employees trying to get fired instead of quitting. If you been at a company for 3-4 years and you want to leave it is really a lot more beneficial to get fired instead. I have seen this happen, but not nearly as much as you would think (at least in IT).

Although you would think companies would want to "recycle" employees by firing them every year to prevent the severance from piling up. The math doesn't really work out like that on top of all possible disruptions of such high attrition rate.

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34. DanielHB ◴[] No.42134854{3}[source]
You underestimate the "it looks bad on my numbers" effect. For example, if you have real state that you can't get rid of, for the company it doesn't matter if the people use it or not if it doesn't affect productivity. But it sure does matter for some accounting department close to the CEO.

It is like that old adage that goes along the lines "Tell me the incentives and I will tell you the outcomes"

35. DanielHB ◴[] No.42134903{4}[source]
Both your arguments seems a bit tinfoil-hat. Grandparent is implying that all the execs making the RTO decisions are personally invested in business real state (why would multiple execs own a bunch of downtown real state?). Although a point could be made for companies who own their real state wanting to prop its value up before liquidating (so a pump and dump) it still stretches believability.

You are implying most companies really think that much about long-term unquantifiable effects.

I can see a better argument being made about executive with big ego likes sitting at the top of his ivory tower (his top-level corner-office) looking over the masses below him.

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36. ◴[] No.42135234{6}[source]
37. Wytwwww ◴[] No.42135279{6}[source]
> like they do in the EU

EU is certainly not a single country and states have sometimes wildly different rules and labor laws. That specific situation is impossible at least in some countries.

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38. Wytwwww ◴[] No.42135284{6}[source]
Making an extra $50-150k+ per year (as long as you are in the correct field) might be very well worth it though?
39. DanielHB ◴[] No.42135734{7}[source]
I used quoted "layoff", in my experience when people are let go it happens during a reorganization mediated by an union where some positions are found to be unnecessary and people are given notice that their employment is being terminated but still work for a few months.

Since this is mediated by an union it only happens if there is a good reason (usually financial problems). I never seen it on an individual case basis it is always multiple people at the same time.

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40. grugagag ◴[] No.42136153{5}[source]
Im not implying most companies think long term, just the very large ones and their interests are tied to some commercial real eastate they don’t want to lose on. Im not sure I understand your tinfoil hat argument here, at least it doesn’t make sense to me in this context.
41. heavyset_go ◴[] No.42138740{5}[source]
> Grandparent is implying that all the execs making the RTO decisions are personally invested in business real state (why would multiple execs own a bunch of downtown real state?)

That is not what I am implying. The owner/investor class have portfolios that depend on commercial and prime real estate holding, and continuing to increase in, value. They might not personally own buildings themselves, but they own companies and financial instruments that do.

Maybe execs themselves are lucky enough to be that asset rich, maybe they aren't, but it's their jobs to call the shots based on the desires of their respective boards.

42. Wytwwww ◴[] No.42139223{8}[source]
Yes but in some EU countries it's very unlikely that any union would be directly involved and the company would still be required to pay severance.
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43. umeshunni ◴[] No.42140974{4}[source]
How would that even make sense at Amazon's scale? A company that makes $500B in revenue is somehow beholden to some random commercial real estate company that owns a few billion in commercial real estate.
44. DanielHB ◴[] No.42145324{9}[source]
Sorry if I wasn't specific, but the severance part is Brazilian specific which I was claiming works better than the "can not fire anyone ever" way a lot of EU countries work
45. lenkite ◴[] No.42165170{5}[source]
> I (unironically) love how it's easy to get a job here; since firing is easy, employers are more willing to take a chance on hiring someone.

Also on HN:

"Looking for a Job Is Tough" https://news.ycombinator.com/item?id=42132125

It appears the facts don't fit you opinion.