Office Romance Costs Thousands: Study Reveals Shocking Impact

URGENT UPDATE: New research reveals that engaging in a romantic relationship with a boss can significantly impact earnings — with increases of up to 6% for subordinates. However, the fallout from breakups can be drastic, leading to an 18% decline in income. This eye-opening study, conducted by a team of international researchers from British Columbia, California, and Finland, was published by the National Bureau of Economic Research this month.

The findings highlight the monetary stakes of office romances. Those who enter relationships with their managers see an average salary increase of about 4,000 euros (approximately $6,500). Conversely, breaking up can result in a staggering loss of around 6,000 euros (about $9,700). The researchers studied over 1,000 manager-subordinate couples in Finland over a span of 30 years, examining the economic consequences of these relationships.

The study shows that women in subordinate positions dating male managers experience a substantial salary growth of 22% in the year following the start of their relationship, compared to just 16% among women in control groups. However, the aftermath of a breakup is severe, with earnings plummeting by 18% the year after separation from a workplace manager. This negative financial impact can linger for at least four years post-breakup.

As office dynamics shift, the research also indicates that the presence of manager-subordinate relationships can lead to increased turnover among other employees. On average, workplaces with 71 employees see an additional four departures when such relationships are present. This raises critical questions about workplace culture and employee morale.

While the researchers acknowledged the challenges in determining whether salary increases stem from favoritism or merit, they found that any perceived preferential treatment can cause resentment among coworkers. They concluded that measures should be taken to limit managers’ influence on the career trajectories of their romantic partners.

In light of these findings, some companies like McDonald’s have banned such relationships outright, a policy that led to the firing of CEO Stephen Easterbrook in 2019 for a consensual relationship with a subordinate. However, the researchers caution that outright bans come with their own complications, as seen with high-profile couples like Bill and Melinda Gates.

As office romances continue to unfold, the implications for employee satisfaction and retention are becoming clearer. Companies must navigate the fine line between personal relationships and professional boundaries. With the financial stakes so high, this study serves as a wake-up call for employees and employers alike.

What to watch for: Companies may implement stricter policies regarding workplace relationships to mitigate the negative impacts highlighted in this study. As discussions of romance and professional ethics evolve, employees should remain aware of the potential financial and emotional consequences of their personal choices at work.