Since June 2023, employees have had increased legal rights to request flexible work arrangements and employers have had greater obligations in responding to these requests.
Typically, flexible working arrangements involve changes to either working hours (e.g. different start and finish times), the location (e.g. working from home), or the pattern of work (e.g. job sharing or split shifts).
The Fair Work Commission has powers to resolve disputes over flexible work requests, and a recent ruling by the Commission has highlighted the need for employers to properly consider a worker’s flexible-work request, including the employee’s personal circumstances and reasonable grounds for the employer’s refusal.
Let’s have a look at the details and what employers need to remember when considering and responding to requests for flexible work arrangements.
Employer obligations in dealing with requests for flexible work arrangements
Under the Fair Work Act, when an employee requests a flexible working arrangement, employers must discuss the request with the employee, and in responding:
- Make a genuine effort to find alternative arrangements to accommodate the person’s circumstances, and
- Consider the consequences of refusal for the employee.
Any refusal must be on reasonable business grounds. In effect, to refuse, the request must be detrimental to your business e.g. it’s too costly, would result in a significant loss in efficiency or productivity, would have a negative impact on customer service, or is impractical.
Employers are required to give the person a detailed written response within 21 days, stating whether they approve or deny the request.
If you refuse, your response must include:
- An explanation of the business grounds for refusing the request and how these grounds apply to the request.
- Other changes you are willing to make that would accommodate the employee’s circumstances (or that there aren’t any changes).
- Information about how to refer a dispute to the Fair Work Commission (FWC).
You and the employee can agree to a working arrangement that differs from what the person originally requested. If this happens, you need to confirm the agreed changes in writing within 21 days of the request.
Recent Fair Work Commission arbitration
The FWC has recently arbitrated a dispute relating to an employee’s flexible working arrangement request.
The part-time employee requested to work from home to care for his wife and school-aged child, who both had an illness/injury that required care.
Under the company’s hybrid-working policy, all employees (including part-time employees) are required to attend the office at least 3 days a week.
The employee applied for a flexible arrangement so that he could work from home 3 days a week and attend the office only once a week. The company initially rejected the request but then agreed to 2 days at home and 2 days in the office.
Later, the employee applied to work from home 4 days a week. The company rejected the request on a number of grounds, stating that working full-time from home did not “support the Company’s hybrid working expectations for all employees”, based on the need to have “an appropriate balance of digital and physical interaction in the workplace”.
While the FWC found that the employer had genuinely attempted to reach an agreement with the employee, it also found that they did not have reasonable business grounds to refuse the flexible work request.
Effectively, the employer was unable to demonstrate a likely detriment to the business that would impact its productivity and efficiency.
In its ruling, The FWC advised that: “generic and blank HR answers are not sufficient alone to establish a reasonable business ground for refusing a request”, and employers must consider the employee’s personal circumstances and genuinely explain how and why such a request would be detrimental to the business.
The FWC made an order that the employee work from home 3 days a week and 1 day in the office for 3 months so that both parties could review the employee’s circumstances and impacts to the business’ operations.
Our advice
When weighing up requests for flexible working arrangements, employers must ensure they consider the employee’s personal circumstances, genuinely try to find an alternative arrangement if they refuse, and to consider the impact a refusal would have on the employee.
Importantly, if you refuse a request, you should ensure that the refusal is based on reasonable business grounds and that you provide a genuine, detailed, and meaningful explanation.
You should also be mindful that if you don’t reach agreement with the employee on an arrangement, you may find yourself spending time before the FWC.
