Landmark decision regarding flexible working arrangements
The Fair Work Commission has recently handed down a landmark decision which sheds some light on how flexible working arrangement disputes will be dealt with in the Fair Work Commission.
The decision follows changes to the Fair Work Act 2009 (‘Act’) in June 2023. The changes to the Act gave the Fair Work Commission the power to arbitrate disputes arising out of requests for flexible working arrangements.
It is important to note that whilst employees have a right to make requests for flexible working arrangements in circumstances where they possess particular attributes (such as a disability or family responsibilities), employers also have the right to refuse such requests where there are “reasonable business grounds” for doing so and they have met the response requirements under the Act, including:
- responding to the request in writing within 21 days of the request;
- discussing the request with the employee;
- genuinely trying to reach an agreement with the employee (including considering alternative arrangements); and
- considering the consequences for the employee if they refuse the request.
The below case gives a good insight into how the Fair Work Commission will approach these types of disputes:
Charles Gregory Gregory v Maxxia Pty Ltd  FWC 2768
In this case, the employee’s employment contract required him to attend the employer’s premises to perform work. However, it was accepted that for much of his period of service, the employee had been permitted to work solely from home (due to COVID-19 impacts).
The employer introduced a policy which required its employees to work at least 40% of their hours from the office. The employee subsequently submitted a flexible working arrangement request where he requested that he be permitted to work 100% of his hours from home.
As the basis for his request, the employee cited:
- his parenting responsibilities relevant to his school age child (which he shared 50% custody of); and
- medical evidence that he suffered from a health condition (an inflammatory bowel disease) that required frequent and urgent trips to the bathroom, which he could not easily access in the office.
The employer rejected this request for reasons which included:
- the employee’s low productivity level, which was 35% lower than the workplace benchmark;
- the need for him to have face-to-face interaction with more junior employees;
- the desire to have fair and consistent hybrid arrangements across the workforce; and
- the belief that the employee would be better supported by a hybrid arrangement.
Importantly, whilst it rejected the employee’s request for flexible working arrangements, the employer proposed alternative arrangements to the employee. The employer proposed that the employee could return to the office through a staggered program where he would attend the office for 20% of his hours from 18 August 2023, and then those hours would be increased to 40% by October 2023. The employer also suggested that the employee could attend the office on days where he did not have custody of his child and that it could relocate the employee’s desk to be close to the office bathroom.
The employee rejected this proposal, and when the employer confirmed it would not agree to the employee working 100% of his hours from home, the employee commenced a dispute application in the Commission.
Commissioner Platt considered the two bases of the employee’s request for flexible working arrangements, that is, his medical condition and his parenting responsibilities, before turning to the employer’s reasons for rejection and whether they constituted “reasonable business grounds”.
Having considered the evidence available, the Commissioner rejected that the medical condition was a “disability” for the purposes of the Act. Accordingly, the Commission determined that it did not have the jurisdiction to consider the dispute in relation to that particular basis for the request for flexible working arrangements.
However, the Commissioner was satisfied that the employee had parenting responsibilities that grounded the request for flexible working arrangements. Despite finding that there was a proper basis for the flexible working arrangement request, the Commissioner accepted that the employer had reasonable business grounds for refusing the request. The relevant commentary explaining the Commissioner’s decision was as follows:
“…With respect to the nexus between the request and the circumstance, it appears to me that the nexus would only be triggered when the custody arrangement is agreed and that the nexus would only relate to the period that [the employee] had custody of the child.
 [The employee’s] request was in writing and set out the details of the change sought and that he be permitted to work 100% from home (including the weeks that he was not caring for his child.
 The [employer] has offered to allow [the employee] to work from home in the weeks that he is the primary care giver of his school aged child and is prepared to provide flexibility sought with respect to the working hours so as to allow the child to be collected from school.
 [The employer] outlined the basis why [the employee] was required to be present in the office for at least 40% of the time when he was not caring for his child. I accept that it is desirable for there to be face to face contact within workforce team. I accept that a face to face presence would allow for observation, interaction and (if necessary) coaching to improve [the employee’s] productivity and provide him with greater support. I accept that [the employee’s] knowledge and experience could be more easily accessed by less experienced team members on a face to face basis.
 I find that [the employer’s] reasons for refusing [the employee’s] request in respect of his child care were based on reasonable business grounds.
 I find that pursuant to s.65C(1)(b)(i) of the Fair Work Act 2009, the grounds on which the employer refused the request to be taken to have been reasonable business grounds and I decline to make any other order.”
Lessons learned from this case
Employer’s who are dealing with flexible working arrangement requests will find many lessons in reading this case. The employer in this case followed an excellent process (compliant with the requirements of the Act), and provided clear and reasonable business grounds for refusing the employee’s request. It is also evident that the employer properly considered the request being made, and proposed very reasonable alternatives that would have assist the employee in meeting this parental responsibilities. Interestingly, Commissioner Platt commented that the employee’s position in response to the reasonable alternatives was ‘weak’.
The decision should give employers confidence in taking a firm position in refusing flexible working arrangements where they can establish that they have reasonable business grounds for doing so. However, employers should carefully consider taking legal advice before refusing a flexible working arrangement request, as the time, effort and cost of defending a dispute in the Commission can be significant, even where they may have reasonable grounds to defend the dispute.
Disclaimer: The information contained this article is general and intended as a guide only. Professional advice should be sought before applying any of the information to particular circumstances. While every reasonable care has been taken in the preparation of this update, Aitken Legal does not accept liability for any errors it may contain. Liability limited by a scheme approved under professional standards legislation.