Back to Bay Street

The morning rush on the Toronto subway used to be a rite of passage so familiar it bordered on the mythological: the sardine-packed cars at Bloor-Yonge, the slow shuffle through Union Station, the double-double clutched like a talisman against the cold. Then came the pandemic, and for a few years, that ritual largely disappeared.

It is coming back. And this time, employers have something to say about it.

Across Canada, a sweeping return-to-office movement is under way — driven by the country's most powerful banks, its provincial and federal governments, and a widening circle of corporations that have concluded the work-from-home experiment, however successful it may have appeared, has run its course. The shift is reshaping commutes, straining office infrastructure, stoking labour disputes, and forcing millions of working Canadians into an uncomfortable reckoning with a question that has no easy answer: who gets to decide where work happens?

The Big Six lead the way

In no sector has the push back to the office been more decisive — or more consequential — than in Canadian banking.

Strangely enough, pre-pandemic, the push from the big financial companies had been the reverse.

“Employers in those sectors, especially big banks, the big consulting firms, were actually desirous of workers working flexibly and actually pushing them to work from home,” Rafael Gomez, a Professor of Employment Relations and Director of the Centre for Industrial Relations and Human Resources (CIRHR) at the University of Toronto told HRD in an interview. “So much so that they were redesigning office spaces away from people having personalized offices, to quote unquote, hot desks and hoteling and booking your space.”

That dynamic, however appears to be reversing. Canada's major financial institutions are among the country's largest private employers, and they have long set the tone for corporate culture more broadly. So, when, in the summer of 2025, RBC, BMO and Scotiabank announced almost simultaneously that employees would be required in the office four days a week starting September 15, it sent a clear signal to every sector watching from the sidelines.

“When a few major institutions, we'll say big banks and also government, began to order their mandate, the opposite of the mandates during the pandemic, but the mandate back to work, I think it caused a lot of employers who were operating without evidence to say, well, let's follow the leader,” said Professor Gomez.

Toronto-Dominion Bank became the fourth major lender to follow, notifying staff in late July 2025 that they would be required in the office four days a week as of November 3. The message from Bay Street was unmistakable: the era of generous hybrid arrangements was drawing to a close.

The timing and coordination of these announcements — four of the country's Big Six banks within weeks of each other — was not lost on anyone. As Colliers Canada senior vice-president Nicholas Kendrew put it, if you are the fifth or sixth bank to announce a return to office, most of the best quality space for your employees will already be taken. The scramble for desks that followed proved the point. Some bank employees reported arriving before 7 a.m. to secure a workstation; those arriving at 9 were finding desks fully booked, pushing staff into cafeterias, meeting rooms, or other floors — often separated from their own teams.

Rogers Communications, one of Canada's largest telecommunications companies and the country's biggest wireless carrier by subscribers, moved in lockstep. The Toronto-based firm told corporate employees in July 2025 that they would be required in the office four days a week during the fall, rising to five days a week by February 2026. The company cited team development and career growth as its rationale. Starbucks Canada similarly required its corporate staff back four days a week. The dominoes, it seemed, were falling in one direction.

“It's actually not a bad idea to follow someone you think is credible,” explained Professor Gomez. “Because think about it, you're actually, you're saving the investment from figuring out whether this is a good decision or a bad decision.”

But he also has a warning: “Where informational cascades break down is when the first mover who may be credible, like it could be government, it could be a big bank, didn't actually do the research and just sort of moved for a whim or move because of other pressures.”

“I mean, I think we went into that during the pandemic,” he continued, “I think we did a lot of that copying the leader and leading to bad decisions during the pandemic.”

Ottawa's complicated position

The return-to-office debate has a particular resonance in Ottawa, where the federal public service represents not only a major employer but the economic lifeblood of the nation's capital.

For years, the relationship between the federal government and its roughly 300,000 public servants over remote work has been a slow-burning conflict. A three-day-per-week hybrid mandate introduced in 2023 was described by union leaders as a logistical disaster — offices that lacked sufficient space, workers forced into construction-site-like conditions, and teams conducting video calls from different floors of the same building.

Prime Minister Mark Carney, speaking with Ottawa Mayor Mark Sutcliffe in December 2025, signalled that updated rules were coming, saying there would "likely be levels of return, depending on seniority, depending on the role and obviously depending on capacity." In February 2026, the other shoe dropped. The Treasury Board announced that executives would be required in office five days a week starting in May, with the broader civil service moving to four days a week by July 6.

The reaction from unions was immediate and fierce. The Public Service Alliance of Canada, the country's largest public sector union, called the announcement "a slap in the face to all federal public service workers across this country," with union president Sharon DeSousa saying it was insulting for any employer to change the conditions of work while its workers were in the midst of collective bargaining. The Professional Institute of the Public Service of Canada went further. Its president, Sean O'Reilly, said the mandate was not about performance or service to Canadians — it was, in his words, "about optics, imposed on a workforce already dealing with layoffs, budget cuts, and a workplace already in chaos."

The practical obstacles are real. Statistics Canada data show that for the fourth consecutive year, the proportion of employed people mostly working from home is falling — but foot traffic in downtown Ottawa as of mid-2025 was still just 77 % of pre-pandemic levels, with many linking the gap to federal workers' continued use of remote arrangements. Meanwhile, some departments do not have sufficient office space to house their own employees even at current attendance rates — a problem that larger mandates will only exacerbate.

Ontario's provincial government has moved in a similar direction. Premier Doug Ford ordered the province's 60,000 public servants to work four days a week from fall 2025, transitioning to full-time in-office attendance by January 2026.

What the numbers say

The statistics behind the Canadian return-to-office trend are striking — and, depending on how you read them, either a vindication of employer mandates or a warning about what lies ahead.

A Statistics Canada report released in late 2025 found that the number of employed Canadians commuting to work had risen for the fourth consecutive year, reaching 82.6% in May 2025, up 1.3 percentage points from the year before. The proportion working mostly from home has fallen steadily from a pandemic peak of roughly 24% to approximately 17%.

But employee sentiment tells a different story. A July 2025 survey by the Angus Reid Institute found three in five Canadians — 59% — saying they would prefer to spend the majority of their working time at home if it were possible. Among those who have worked remotely in the past or are currently doing so, that number jumped to three-quarters.

The gap between what employers want and what employees prefer is perhaps widest in the knowledge economy — precisely the sector these mandates are most squarely aimed at. According to another Angus Reid survey, 32% of remote workers say they would consider quitting if ordered back to the office most of the time, while 27% say they would do so quickly. More than half of those told to return are "very upset" or "upset."

“Business likely perceives that office interaction facilitates productivity even though the evidence is weak,” says Morley K. Gunderson, University of Toronto Economics, Professor Emeritus. “In many cases it is difficult to monitor the output or performance of employees, and easier to monitor the input when at work.”

The office space paradox

One of the more unexpected complications of the Canadian return-to-office wave has been the collision between employer ambition and physical reality: there simply is not enough desk space to accommodate everyone at once.

Office leasing activity across Canada grew for the second consecutive year in 2025, with annual net absorption totalling 2.2 million square feet countrywide, the strongest performance since the start of the pandemic. But the recovery is uneven. While Toronto's financial core has seen vacancy in the very best buildings fall to roughly 3%, older Class B and C office space downtown carries vacancy rates above 25% — a divide that reflects workers' and employers' shared preference for newer, amenity-rich buildings over ageing towers.

Mark Fieder, president of Avison Young Canada, described "a growing desire among big firms to have their people back in the office for a meaningful amount of time," adding that the resulting absorption of office space was happening so quickly that his firm was "scrambling to measure it."

For many of the banks themselves, the shortage is immediate. RBC and Scotiabank both acknowledged needing to find additional real estate before their four-day mandates could be fully enforced. Some employees at one of Canada's largest lenders found themselves relegated to working from the cafeteria while waiting for their organization to locate more desks. The irony — that employers are ordering workers back to offices that cannot yet hold them — has not been lost on the employees involved, nor on their unions.

A distinctly Canadian wrinkle: the tariff economy

The Canadian return-to-office debate unfolds against an economic backdrop that has no real parallel south of the border. Since the spring of 2025, Canada has been navigating the fallout from sweeping U.S. tariffs on Canadian goods — a trade shock that has stalled hiring in manufacturing and goods-producing industries, raised costs for businesses, and cast a shadow over the labour market more broadly.

The Bank of Canada's business outlook survey for the third quarter of 2025 found that companies had ample labour capacity and could find workers more easily than they could in 2024, with firms reporting critical labour shortages at their lowest level in five years. In that environment, some analysts have argued, this may be a more opportune moment for employers to impose return-to-office mandates — workers who might otherwise have quit in protest of a new policy are now less likely to risk leaving a secure position.

“A weaker job market definitely gives employers more leverage in all dimensions including RTO mandates,” Professor Gunderson told HRD. “Providing flexibility in allowing WFO helps recruiting and retention. It also enables paying lower wages in return for that flexibility.  In a weak labour market there is less need to provide that flexibility or to pay compensating wage premiums in return for requiring RTO.  RE persisting in the months ahead, all of these changes have persistence effects as the parties adjust to the new changes.”

It is a calculation that cuts both ways. The uncertainty created by tariff-related economic turbulence may suppress immediate attrition. But labour market experts caution that suppressed discontent is not the same as genuine buy-in. Skilled workers, in particular, have long memories, and the next tightening of the jobs market will give them options they currently lack.

As Opeyemi Akanbi, an assistant professor in communications at Toronto Metropolitan University who studies work culture, put it: "It's very hard to see employees winning this particular battle, because the leverage really belongs to the employer." That leverage, most observers agree, is not permanent.

“We’ve actually had a pretty low growth for 10 years, but especially now in the last two years,” agrees Professor Gomez. “…it's compromising the ability for employees to choose between better offers.”

The tech holdout

Not every major Canadian employer has followed the banking sector's lead. Telus, one of the country's largest telecoms, has adopted a markedly different posture from its competitor Rogers. The company said that roughly 90 % of its employees work on a flexible hybrid schedule and that it would continue to evaluate and evolve its policies to support employee and business needs.

Much of Canada's technology sector remains more resistant to the full-time office push than the finance and telecom incumbents. Many tech firms adopted remote-first policies during the pandemic and have been slower to reverse them, citing both talent retention and the nature of the work itself. The divergence between the finance sector — which has moved aggressively back to five days — and much of tech, which has largely settled on hybrid models, mirrors a pattern visible in the United States but with its own Canadian texture: here, the banking sector's cultural weight is proportionally greater, its downtown towers more symbolically central to the identity of cities like Toronto and Calgary.

In knowledge-intensive sectors such as finance, consulting, and professional services, the return-to-office trend is accelerating, with Toronto's financial district experiencing strong leasing and hiring. Banks' headcounts have expanded since 2020, meaning they need more seats than before. The commercial real estate sector, after years of rising vacancies and hand-wringing about the permanent death of the office, is beginning to breathe again.

What workers want — and what they're doing

Despite the mandate wave, Canadian workers have not simply acquiesced. Unions representing public servants have filed policy grievances, staged rallies, and threatened legal challenges. Federal unions representing more than 330,000 workers launched a national campaign in early 2025 promoting remote work as the future of the public service. And on the question of whether mandates actually improve the outcomes employers claim to be seeking, the evidence in Canada — as in the United States — is ambiguous at best.

“Objective research takes time,” explains Gomez “So by the time you're looking at this stuff, you're looking at events that happened one or two years before and then the research is released. So for the most part, employers operate in a black box.”

Six in ten Canadian workers say they prefer a hybrid model, and researchers who study the labour market here are watching closely for signs of the talent drain that has accompanied similar mandates elsewhere. The question of whether Canada's current economic softness — tighter conditions in goods-producing industries, slower hiring nationally — will dampen that dynamic remains open.

What is clear is that the issue has become, as one labour researcher put it, a flashpoint that goes well beyond the logistics of commuting. It touches questions of trust between employers and employees, the meaning of work-life balance in a country where the cost of housing in major cities has made long commutes a grinding reality for many, and the appropriate role of government as both a major employer and a setter of norms for private sector behaviour.

For now, the train cars are filling up again. Whether Canadians are returning to the office by choice, by necessity, or by force of mandate depends on who you ask — and where they work.