Communication is the ultimate solution, but that solves location awareness as well. Unfortunately, once someone gets something in their head there’s a wall of prejudice before you get to communication, and appearances create unwanted dialog between managers.
So firefighting with another team looks like you’re faffing off by the cantina, and the hero-mode 15 hour WFH crunch that saved our bacon looks unfair and improper, and now it’s a discussion... It’s not just doing the job, but also making sure no one three departments over develops feelings about how that is presented internally.
Logs still require someone to aggregate them, analyse them and present them in a form that's easily accessible and understadable by managers and also always up to date.
Teams will make all of this available without the company having to spend resources and manpower.
It would be very challenging for companies to retroactively change this without it being successfully challenged in court (you can't really rely on consent after the employment relationship begins).
This is opt-in by the end-user and disabled by default, so represents a genuine opportunity for employees and employers to decide if they want to gather this information and if so, what the opt-in/out procedure looks like.
This enhancement seems like a decent improvement on an existing feature. Folks are up in arms about a privacy problem which may exist in the underlying, pre-existing feature (updating your presence in the office in Teams/Outlook). This just simplifies the process for the employee to comply with whatever their employer mandates.