On 12 July 2024 a decision was handed down by Deputy President Lake in the Fair Work Commission following an application made by employee to deal with a dispute about the right to request flexible working arrangements.
Facts
Mr Peter Ridings was an office worker for FedEx who requested multiple work from home arrangements from 2019-2024 with some agreed upon mutually and other disputed. Mr Ridings was the father of 2 intellectually disabled children with autism whose wife also had had autism and Ehlers Danlos Syndrome, all of whom resided with him. Mr Ridings’ consistent reasons put forward to his employer in his requests to work from home was to support his wife and children.
Mr Ridings was working from home 2 days a week and 2 days in the office between September 2022 and July 2023. He took 9 days of annual leave and 5.5 days of carers leave during this period, coinciding with the days he was required to work in the office.
On 28 June 2023 FedEx advised employees that as at 17 July 2023 employees would now be required to work in the office 3 days a week. Mr Ridings enquired how this would affect part-time employees and was advised by FedEx that the expectation was the same of part-time employees. Mr Ridings made a written request for a flexible working arrangement on 12 July 2023 seeking to work from home 3 days a week and 1 day a week in the office putting forward the same reasons as he had previously provided, providing documents including medical documents in support of his request.
FedEx requested his request on 1 August 2023 based on “business and operational requirements” namely that this proposed arrangement would be “likely to have loss of efficiency or productivity”, and that the company “encouraged intentional and effective collaboration among team members and more in person interactions in office” thus the expectation to work at least 3 days a week in the office.
Nevertheless, on 7 August 2023 FedEx provided Mr Ridings with an alternative stating he could continue working in the office for 2 days a week and work from home for 2 days a week, essentially a continuation of his current working arrangement. Mr Ridings took issue with this and began taking annual leave one of the office days per week, leaving him with only one day a week in the office.
On 18 September Mr Ridings stated he had sprained his ankle and could not drive. He took unpaid leave until 1 December 2023. On 4 December 2023 Mr Ridings said he was able to work 4 days a week but was unable to drive to the office so asked if he could work from home during this period. On 10 January 2024 he made another request for flexible working arrangement to work from home 4 days a week indefinitely, citing the same reasons as before and providing more documentation including medical. From 31 January 2024 FedEx tried to contact Ridings to discuss the request and an exchange of emails took place and disagreement ensued regarding the arrangement, and on 23 February 2024 FedEx rejected Mr Ridings’ request to work from home 100% of the time giving written reasons. Mr Ridings lodged an application with the FWC on 23 February 2024. FedEx agreed to continue Mr Ridings’ current work arrangement of 2 days in the office 2 days at home pending the arbitration decision. Nevertheless Mr Ridings refused to come into the office.
The Findings
The Full Bench of the Commission outlined the 5 requirements for a flexible working application to be validly made in accordance with the legislation (section 65(1), s65B and s65C of the Fair Work Act). The requirements are:
1. Any circumstance must apply to the Applicant. It must be a present circumstance rather than an anticipated circumstance.
Section 65 allows for a flexible working arrangement to be requested if any of the depicted section 65(1A) circumstances apply.
2. The employee’s desire for changed working must be because of the relevant circumstances under s.65(1A) and the request for a change in working arrangements must relate to it.
Section 65(1A) circumstances include the likes of:
- Pregnancy
- School aged children
- A carer
- Has a disability
- 55 years or older
- Family and domestic violence
3. The employee has a minimum period of service of 12 months.
4. The request must be in writing.
5. The request must set out the details of the change sought and the reasons for the change.
The Commission found that Mr Ridings had satisfied all of the required steps to make a valid flexible working arrangement request.
The Commission then had to determine whether the employer had refused the request. An employer has the discretion to refuse the request “only if” (s65A FWA):
a) The employer discusses the request with the employee.
b) The employer genuinely tries to reach an agreement with the employee about making changes to the employee’s working arrangements to accommodate their circumstances.
c) Where the employer and employee have still not reached an agreement, the employer may only refuse the request on reasonable business grounds.
Did FedEx genuinely attempt to reach agreement to accommodate Mr Ridings’ circumstances?
The Commission found that it did. It considered what the meaning of what ‘genuinely attempt to reach agreement’ means in relation to an employer refusing a request for a work from home agreement (as under s.65(3)(a)(ii) of the Fair Work Act).
The Commission emphasized that an employer can only refuse a request with the information that has been presented to them, and that the employer takes reasonable steps to enquire about the employee’s circumstances.
At hearing Mr Ridings raised that his carer demands had increased, calling for this higher work from home need. However, not having been clearly told of the particular details placed FedEx in a position where the commissioner said ‘the employer could have not been properly informed of these circumstances’ limiting the ability of FedEx to have acted unconscionably when dismissing Ridings’ application. The Commission was satisfied FedEx did try to genuinely attempt to reach agreement in understanding Mr Rindings’ circumstances with the information before them.
Did FedEx have reasonable grounds to refuse the request?
The Commission found that it did not. It said that although the legislation does not limit what reasonable business grounds mean, the interpretation and wording of this provision seems to require the employer to demonstrate a likely detriment to the business if they wish to refuse a flexible working arrangement. If there is no detriment to FedEx in accommodating the request, it is in the employer’s interest to accommodate the employee in encouraging employee retention and provide job security.
Section 65A(6) FWA requires an employer to explain how the grounds apply to the flexible working arrangement request. FedEx relied on s65A(5)© FWA for refusing Ridings’ request as approving the request would likely result in a significant loss in efficiency or productivity. If the argument was that the lack of interaction and collaboration would cause a likely detriment to productivity and efficiency, it would need to be substantiated. For instance, if the employee was not meeting targets, difficult to contact, and tasks were not being performed to a specific standard while he or she was working remotely, it would be a reasonable business ground to refuse the request. Another example could have been the lost opportunity to assist an employee to improve performance through collaboration and guidance if working from home 100% of the time. The evidence of Mr Bilic and Mr Michael suggested that this was a potential issue. However, this was never raised by FedEx refusing Mr Ridings’ request.
Another reason which FedEx could have considered was concerns on the Applicant’s wellbeing. Given that Mr Ridings had not been in the office since 18 September 2023, there would be sufficient reason to ensure that Mr Ridings caretaker duties of his wife and children’s conditions were accounted for and the Employer could check from time to time. Work from home arrangements on a full-time basis can be isolating, particularly in a potentially stressful home environment. Ensuring that Mr Ridings would work in the office on in some kind of regular pattern would allow FedEx to ensure there are adequate support processes at work for him.
The Commission found that although it is beneficial for Mr Ridings to have further collaboration with his fellow workers, FedEx fail to consider Mr Ridings’ personal circumstances in their reasoning for refusing their request or how approving the request would be detrimental to the business. Generic and blanket HR answers are not sufficient alone to establish a reasonable business ground for refusing a request. Therefore it was not satisfied that FedEx provided a sufficient explanation for why the request was refused on reasonable business grounds on 21 February 2024.
How would the Flexible Working Arrangement apply?
Generally, it should be open to the employer and the employee to negotiate an outcome which addresses the circumstances. However, the Commission was satisfied that there was no reasonable prospect of the dispute being resolved without making the Order under s.65C(3) of the Act, however stated that with this also comes a great degree of caution to be exercised by the Commission.
Section s.65C(2) of the Act requires to consider fairness between the employer and the employee. Fairness encompasses flexibility, certainty and stability for employers and their employees.36 It is important that the employer has flexibility to be productive and economically viable. The flexible working arrangement should not impede or burden the employer from making decisions. It is also important to recognise employees’ right to access flexible work arrangements under the NES.
Orders made
The Commission ordered the following flexible working arrangement:
- A 3-day work from home and 1 day in the office arrangement when Ridings may be required to work in the office on certain days- Noting the commission stated that Ridings was entitled to take his statutory entitlements on a working from the office day;
- If:
- Ridings does not attend the office for 2 consecutive weeks;
- There are performance concerns or
- There are genuine operational requirements which require Mr Ridings’ attendant
FedEx may lawfully and reasonably request Mr Ridings to work at the office on the days that he is permitted to work from home.
- This Order is valid for 3 months and will expire on 12 October 2024 to allow the parties to review Mr Ridings’ circumstances and provides FedEx the opportunity to assess its operational requirements.
- If Mr Ridings wishes to extend or vary the flexible working arrangement of this Order once it expires, he will need to lodge a new request in accordance with s.65 of the FWA.
Key Take Aways
This case highlights some very important considerations for employees and employers. Communication is key. Careful consideration of all factors and appropriate supporting documentation. Also the limits of Orders. Reaching a mutual agreement is usually the preferable course of action.
Please reach out to our employment lawyers for specific advice about flexible work arrangements. Call us today on 1300 862 529, or email your enquiry via the Contact us link, to arrange an initial consultation. We look forward to meeting with you.”
This article was written by Fran Keyes, Practice leader (Employment & Discrimination Law), assisted by William Johnson, Law Clerk