Company allows high-performing employees to work from home, forces everyone to return to office when underperforming employees complain: 'Because others are underperforming, we have to return to office full time.'

They should've used working from home as a reward in the first place. 

How should a company motivate its employees to perform well? You might think that employees should be intrinsically motivated to do well just for the sake of doing well and promoting the company, but we all know that's not always how it works. If you think that way, you're probably not a very good manager. Most employees are motivated to do their job competently because they want to stay employed, but putting food on the table doesn't motivate them to go above and beyond. Intrinsically motivated employees might work hard regardless of the results, but they are also motivated by a desire to rise in the company's ranks, advance their careers, and earn more money. If they don't think hard work will achieve those things, they will probably look for a new job where hard work is rewarded. 

Companies don't always reward their employees publicly for their hard work. They certainly don't announce it when one employee gets a raise while others don't, because that breeds resentment. They might give someone a verbal shoutout or announce that they've gotten a promotion in front of the other employees, and there's nothing wrong with that. But if you give one employee more vacation time than another as a reward for hard work, you have to be discreet about that. You don't want coworkers resenting one another for getting more benefits, even if it's based on the merits of their work. It does not motivate underperforming employees to improve.