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Australia – Flexible Work Requests: Achieving Compliance With Legal obligations

17 October, 2013

 

Legal News & Analysis – Asia Pacific – Australia – Labour & Employment

 

Summary

 

  • Flexible work arrangements have been in the spotlight again this year with the categories of employees who can request these arrangements expanded significantly and the circumstances in which an employer can refuse a request clarified.
  • Line managers are often called upon in the first instance to grapple with the complexities which are now unfortunately inherent in dealing with requests for flexible work arrangements.
  • While a manager’s views should be taken into account when assessing an employee’s request for flexible work, organisations are best placed to achieve legal compliance by ensuring those views are soundly based from an operational perspective and supported by objective reasoning.

 

Introduction

 

Flexible work is the term used to describe a range of ‘alternative’ working arrangements, such as part-time work, varied hours of work (altered start/finish times or compressed working weeks – where an employee performs their standard working hours over a fewer number of days), teleworking, working from home, job splitting and job sharing.

 

While the right for employees to request flexible work arrangements was expanded significantly this year1, a key compliance issue relating to the consideration of flexible work arrangements can be manager resistance to these arrangements.

 

There are many understandable reasons why a manager may be resistant to flexible work requests. They may include fear of ‘setting a precedent’ of flexible work within an organisation, a lack of understanding of the legal framework, previous experience of flexible work arrangements requests, or a belief that a certain role is incompatible with flexible work (e.g. because it is a ‘client facing’ role or ‘too senior’).

 

The challenge for an organisation however, is to ensure that relevant line managers appreciate:

  • the range of legal obligations2 which they must comply with when assessing requests for flexible work, and
  • that to reduce the risk of legal claims, they must balance their concerns against these legal obligations.

 

When Can An Employer Lawfully Refuse A Request For Flexible Work?

 

Under the Fair Work Act, an employer can refuse a flexible work request on ‘reasonable business grounds’.

 

The recent amendments to the Fair Work Act3 set out a non-exhaustive list of what may constitute reasonable business grounds for refusing a request. They include:

 

  • the excessive cost of accommodating the request
  • that there is no capacity to reorganise work arrangements of other employees to accommodate the request
  • the impracticality of any arrangements that would need to be put in place to accommodate the request, including the need to recruit replacement staff
  • that there would be a significant loss of efficiency or productivity
  • that there would be a significant negative impact on customer service.

 

Achieving Compliance

 

A manager’s views should definitely be taken into account when assessing an employee’s request for flexible work. The employee’s direct manager will generally best understand their role requirements and be in the best position to judge whether a flexible arrangement will work for them in practice. An organisation should however carefully test those views to ensure they are reasonable and objective.

 

A recent case of the Fair Work Commission4 reminds us that, to be lawful, a manager’s / organisation’s reasons for refusing a request must be soundly based on objective reasons.

 

Further, it may not be enough for an organisation to refuse a request to work flexibly based simply on the fact that it may cause some adverse impact to the business. In the case of ASU v Brimbank City Council (Brimbank),the Fair Work Commission stated that the employer needed to ‘point to some cost or adverse impact over and above the inevitable small adverse impacts associated with any material request that is sufficient to outweigh the employee’s personal considerations in the legitimate pursuit of a better work life balance’.6

 

In other words, the Fair Work Commission accepted that accommodating any request to work flexibly may put the employer to some inconvenience, resulting in some additional cost or loss of efficiency – but that of itself may not be enough to establish that the employer had ‘reasonable business grounds’ for refusing the request.

 

Recent Cases

 

In Brimbank, several employees in the HR department were requesting to work a 9 day fortnight. In considering whether there were reasonable business grounds for refusing the requests, the Fair Work Commission carefully examined the work performed by each employee. It also considered other matters, such as proposed coverage on the employees’ days off, the reasonableness of changes to the employer’s policy against voicemail (to enable messages to be left for the employees) and the likelihood of work coming in on the employees’ days off. The Fair Work Commission decided that each of the employees’ roles could be performed on a 9 day fortnight basis, without a significant effect to their employer’s operation.

 

In contrast, in the case of Lamb v Bunnings7, Bunnings introduced a new roster requiring Mr Lamb to work Fridays and Saturdays. Mr Lamb’s wife worked on these days and he normally cared for his young children while she did, Mr Lamb objected to the introduction of the new roster and sought not to work Fridays or Saturdays.

 

In deciding the case in Bunnings’ favour, the Fair Work Commission took into account the following factors:

 

  • that Bunnings had a genuine business requirement to increase staff numbers on Fridays and Saturdays,
  • that Mr Lamb was a highly skilled, effective and valued member of the team;
  • that other employees did not possess the knowledge and skills to the equivalent level to replace him on these days, and
  • that Bunnings had considered Mr Lamb’s personal circumstances and alternatives put forward by him and none were workable.

What is clear from the recent cases is that tribunals will look at all relevant facts to determine, on an objective basis, whether the flexible work request can be accommodated.

 

It is important for organisations to educate their managers, so that they understand that flexible work requests can only be lawfully refused on reasonable and objective grounds – and that they need to guard against making subjective decisions to refuse these types of arrangements, as such decisions could leave the organisation facing a legal claim.

 

Endnotes

 

  1. From 1 July 2013 the categories of employees who can make a request for flexible work arrangements include employees who are: parents, carers, have a disability, are aged 55 or older, are experiencing domestic violence or provide care or support to a family member who is experiencing domestic violence (see Section 65(1A) of the Fair Work Act 2009 (Cth)).
  2. Under the Fair Work Act 2009 (Cth), state and territory discrimination legislation and/ or provisions of applicable enterprise agreements.
  3. Section 65(5A) of the Fair Work Act 2009 (Cth).
  4. Ms Hanina Rind v Australian Institute of Superannuation Trustees [2013] FWC 3144. The full decision is available from the Fair Work Commission   
  5. Australian Municipal, Administrative, Clerical and Services Union v Brimbank City Council [2013] FWC 5. The full decision is available from the Fair Work Commission
  6. Australian Municipal, Administrative, Clerical and Services Union v Brimbank City Council [2013] FWC 5 at [16]. The full decision is available from the Fair Work Commission
  7. Jeffrey Lamb v Bunnings Group Limited [2013] FWC 201. The full decision is available from the Fair Work Commission

 

herbert smith Freehills

 

 

For further information, please contact:

 

Paul Burns, Partner, Herbert Smith Freehills
[email protected]

 

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