How to Spend Your HR Budget Now That Everything’s Virtual

human resources, budget, remote work, virtual team, HR budget

It’s safe to say no one saw the massive change in workstyles coming before the outbreak of COVID-19. Many of the most forward-thinking companies invested millions of their budget in high-tech office buildings for their employees and doubled down on in-office perks to retain top talent. 

When the world shut down and companies moved to remote or hybrid workforces, every department had to make changes. Each department had to readjust its budgets to account for everything from increased demand to reduction in workforce, or simply a change in day-to-day operations. Human Resources is certainly no exception, begging the question: how do you spend your HR budget now that everything’s virtual? 

Top Concerns for HR in a Virtual World 

As able workforces successfully moved to remote work, it became clear that many employees thrive in a remote world. Employee oversight and compliance concerns quickly drifted away as team members demonstrated they could work just as – if not more – efficiently from home as they did in the office. However, new problems arose and should be the top concerns for any HR or People department as we continue to invest in remote work and the results of it. This includes employee drift, burnout, and attrition. 

Employee drift is the natural occurrence of employees slowly drifting apart as they lose daily face-to-face interactions. This is not always a bad thing, as many employees who enjoy remote work find that a major benefit is more time spent with family, leading to happier employees. Naturally, this can lead to slightly less engaged employees, but over-indexing on employee engagement can produce the opposite effect of colleagues who feel forced to engage in a disingenuous way.  

Burnout is a threat to any workforce, regardless of location. While this responsibility is shared with managers, HR departments must ensure they are setting standards and protocols that ward against it. It is tempting to think with a reduced commute and everyone’s office being ten feet from their bedroom that employees can increase their productivity by simply working more or being on-call at all times. It’s essential, however, for managers to encourage their teams to set boundaries. Without boundaries between work and home-life, employees can quickly reach a point of burnout and need sabbaticals or consider positions at other companies. 

Finally, attrition should be top-of-mind for every human resources department, as workers now have more options than ever when considering who they want to work for. As companies like Google invested more and more in their in-office perks, they saw a direct return on employee retention. As a former Googler myself, I can attest that it’s tough to leave when you have hot meals 3x a day, unlimited snacks, a free gym, etc. Without in-office perks (and a Google budget), investing in at-home and virtual benefits may be one of the keys to employee retention in a remote world. 

HR Budget Planning: How to Make it Happen

A lot of HR planning happens top-down and can easily fall into a status quo of what has worked before. It’s important to collect regular feedback from employees to gather insights into what’s important and what they value in a shifting landscape. Following the same budget from ten years ago is a great way to keep your company’s workforce in 2011. If you want to grow, however, you will need a new perspective. 

Start by analyzing past budgets. What has worked, what has been well received and what is specific to in-office work. Take a regular (at least annual) pulse survey to determine what’s working and what can be improved. Then think creatively about what employees are asking for. Did you invest heavily in scheduling tools when employees are telling you they want to work asynchronously? Are you sending them meals when they’d rather have an ergonomic desk? As a small business or small HR department, it’s vital to focus resources on what your employees are asking for, not just what trends well on Twitter. 

Spending Your HR Budget In A Virtual World

Depending on the survey results, most of what your team will be looking for will fall into the categories below. This should come as no surprise that employee happiness and retention should be your north star in considering and investing in any of the below.

Culture/Team Building

With the loss of the office comes the loss of the water cooler/break room/micro kitchen, etc. It’s important then to replace this opportunity for spontaneous social interaction with deliberate investment in culture and team-building. A lot of HR managers think team-building and their minds go to trust falls and communication exercises, but I’m here to tell you the best way to tackle culture and team-building in one word; Fun.

Investing in fun sounds antithetical to work, but time and again, companies have succeeded in retaining top talent just because they are fun places to work. In a virtual world, this doesn’t mean adding a stand-up comic to your weekly huddle, but investing in fun is a surefire way to build camaraderie and keep employees happy. Consider a virtual escape room or virtual trivia event to get your team laughing with each other and engaging over something besides work. 

Another critical element to culture is making teams feel like they’re part of a team even when they’re not in an office. Investing in regular snack boxes or at-home gifts is a great way to send them some appreciation and mimic the benefits of in-office perks. Similarly, high-end SWAG, specifically for at-home work, is a nice gift to keep employees comfortable while clocked in. 

Another must-have in a remote world is investing in Diversity, Equity, and Inclusion. As many companies are doubling down on their efforts to improve DEI in the workplace, it’s important to invest in initiatives designed for a remote workforce. 


The next area of investment for HR Departments to up their investment on is recruiting. While many are considering reducing budgets for recruiting in 2021 due to a rise in automation in the recruiting process and overall tightening of budgets, those that invest in their recruiting will find the return on that investment in an engaged, long-term workforce. 

This may be one of the hottest job markets we’ve ever seen, and some workers are demanding remote work, opening up their opportunities and your competition. Unfortunately, recruitment fairs are less common for the remote workforce, and that budget should be reallocated to some of the leading recruiting sites that focus on remote workers. In addition, many companies are offering signing bonuses to their prospective employees to woo them away from their existing jobs. This trend is becoming more popular in industries that previously eschewed the practice. Beefing up your hiring process and adapting to a virtual model will be a game-changer in attracting the right talent. 


Onboarding is another area where HR needs to step up their game to match the excitement of the in-office experience. Consider investing in flights for new hires to whatever city has the highest concentration of workforce or flying them to meet their manager. A high-touch experience is a great way to make new employees feel valued and to get them excited about work. Additionally, HR Software that automates the on-boarding workflow like setting up payroll, signing up for benefits, and learning company processes can improve efficiency in onboarding and leave more time for personal connection. 


Finally: the good stuff. As we’ve said, remote workers have options. That’s why it’s critical to consider the benefits you’re offering employees as one of the key factors in restructuring your budgets for a remote world. 

Start with salaries. Many companies are saving money on commercial real estate and overhead, but little of that is going back into employees’ pockets. Wage increases are not only a rational reallocation of that spend, but they are an indication that the company is acknowledging the shift in its priorities to its workforce over a fancy corporate office. In line with that, career development has grown in recent years and should be considered when rebalancing your HR budget. Once feared as a means for employees to extend beyond the company’s needs, it is now a critical piece of talent management to invest in employees and see that investment come back in output. 

After compensation and career development, think about employee wellness. Home office upgrades are a no-brainer as they keep employees productive and healthy during long periods of work. Gym memberships and health benefits are other areas of investment that will signal to employees that you care about their wellbeing and keep employees healthy. 

Paid family leave and wellness days are another way to help personnel unplug and take time off work when work/life balance has become increasingly blurred. Many companies have found that allowing employees to take time off actually increases their output improves retention. 

Bonus: Communication

While it doesn’t always fall under HR, communication tools and processes are critical to a successful remote workforce. While many companies invest in performance management and employee oversight, a solid communication strategy is a better way to build trust and ensure your team is working efficiently and to the best of their ability. Start with a solid communication strategy built around mutual trust and an investment in employee well-being. From there, any changes to your HR budgets or processes come with a baseline understanding that you’re working for the employee’s well-being, not the bottom line.

Takeaway: Retention

If it wasn’t obvious, whichever way you restructure your HR budget for a remote world, retention should be your number one focus. It’s 10x more expensive to hire a new employee than retain an existing one, so whatever strategy you deploy, make sure it is focused on that north star. As you shift your budgets to optimize your remote workforce, focusing on this goal will help you align your priorities and help guide decisions when programs need to be cut.

Rob Warner
Follow Me
Latest posts by Rob Warner (see all)

Something to add? We welcome your comments below.

This site uses Akismet to reduce spam. Learn how your comment data is processed.



Join our email list to receive the latest updates.

Affiliate notice: Some of the links on this site are affiliate links. We only promote products we have tried and love. We may receive a small commission if you click and buy.

Skip to content
Share via
Copy link
Powered by Social Snap