Informal Wear Does dressing down send productivity up?

Put the staff of Open City Communications on a fashion show runway during a typical workday last summer, and you'd have seen president Phil Hall resplendent in khakis, a Southwestern-style short-sleeved shirt and black Reeboks; senior vice president Karen Freid in a cotton gauze gypsy dress with sandals and a blue T-shirt; and vice president Robert Toledo sporting a sleeveless yellow T-shirt, jeans, sneakers and an American-Indian necklace.

"I specifically do not want my staff to dress up," says Hall, who founded the New York City public relations firm in January 1994. "I don't see the correlation between suit-and-tie and quality and productivity."

Hall is not alone. Major American corporations have recently instituted dress-down policies. And even in Japan, known as one of the most conservative business climates on earth, colored shirts, plaid trousers and even sneakers are appearing in corporate offices.