In this matter, the part-time employee (Applicant) had submitted a formal Flexible Work Arrangement request to his employer, FedEx (Respondent), that he be allowed to work from home 100% of the time (four days per week). The request was based on the fact Mr Ridings had carer duties for several family members. The Respondent ultimately decided it had ‘reasonable business grounds’ for rejecting the request, which triggered the Applicant making an application for the Commission to determine the dispute.
The findings of the Commission therefore provide some guidance for both employers and employees in applying for, considering, and resolving disputes regarding Flexible Work Arrangements.
Summary of Facts
The Applicant had been working for FedEx for several years as a Clearance Classifier. On 28 June 2023, the Operations Manager for FedEx sent an email to all Clearance Managers regarding an update on the hybrid working model at the company. The update confirmed that all employees (including part-time employees) would be required to work in the office a minimum of 3 days per week.
On 12 July 2023, the Applicant applied for a Flexible Work Arrangement that would allow him to work from home 3 days per week and 1 day a week in the office. He provided reasons and several medical documents in support of this request, which confirmed he needed to provide care to his wife and children. The Respondent initially rejected this request, but the parties ultimately settled on an arrangement that would allow whim to work 2 days at home and 2 days in the office.
On 10 January 2024, the Applicant lodged a further Flexible Work Arrangement upon the expiry of his previous Flexible Work Arrangement. The Applicant sought to work from home 4 days a week indefinitely. The request was nearly identical to the previous request he had submitted on 12 July 2023, and contained similar supporting evidence (at [23], [24], and [39]).
Between 31 January 2024 and 23 February 2024, the Respondent attempted to follow up with the Applicant to obtain further information in relation to the basis for this new request and to discuss the proposed arrangement. The Applicant maintained that all correspondence should occur in writing, or alternatively any in-person meetings with his employer to discuss the request should be recorded.
On 23 February 2024, the Employer rejected the Applicant’s further request to work from home 100% of the time. The ‘reasonable business grounds’ relied on for refusing the request, included ) (see [32]):
- the Company was committed to in-person collaboration and interaction, knowledge-sharing, training, support and culture-building. The Applicant’s role benefitted from having in-person discussions with colleagues;
- the Company’s hybrid working policy was fit for purpose and expected employees in the office at least 3-days a week. Permanently working from home did not support this hybrid working expectation;
- face-to-face presence allows teams to have an appropriate balance of digital and physical interaction at the workplace; and
- travel time to and from work is a requirement to fulfil employment obligations and the travel time to and from work was reasonable.
Consideration and Findings
The Deputy President firstly determine whether the Commission had jurisdiction to proceed to arbitration (which has been an issue for several applications brought before the Commission under section 65B).
The Deputy President applied the “five requirements” outlined by the Full Bench (see Jordan Quirke v BSR Australia Ltd [2023] 327 IR 373) for determining whether a Flexible Working Arrangement request had been validly made, which are (at [36]):
- Any circumstance under s65 must apply to the Applicant. It must be a “present circumstance” rather than an anticipated circumstance;
- The employee’s desire for changed working must be because of the relevant circumstances under s65(1A) and the request for a change in working arrangements must relate to it.
- The employee must establish a minimum period of service with the employer of 12 months.
- The request must be in writing.
- The request must set out the details of the change sought and the reasons for the change.
The Deputy President was satisfied that these pre-requisites had been met, including that the Applicant was a carer for the purposes of s65(1A)(b) of the Act. The final requirement was that the Respondent had properly considered the application and formally refused the request under s65B(1)(b)(i) of the Act.
Employee conduct prior to Arbitration will be considered
After a compulsory conciliation conference had taken place, the employer agreed to trial an alternative arrangement that would allow the Applicant to work from home 3 days per week and attend the office 1 day per week. The Applicant decided that he would not comply with this direction to work from the office at least one day per week, until the Commission had made a final decision in determining the dispute (at [40).
The Deputy President found that it was an error for the employee to proceed under this assumption. The employee was under a duty to follow the employer’s lawful and reasonable directions until the request for a Flexible Working Arrangement was granted. (at [51]). Importantly, the Deputy President sent a warning to future employees seeking resolution of any Flexible Working Arrangement dispute by the Commission stating (at [52]):
“Future employees seeking this process should ensure that they are following lawful and reasonable direction from the employer. It is a factor I will consider when determining the practicality of the order (emphasis added)”.
Did the Respondent genuinely attempt to reach an agreement with the employee?
The Commission found (at [53]-[62]) that the evidence established the Respondent had met its duty under s65(3)(a)(ii) of the Act. In doing so, the Deputy President found that the term “genuinely attempted to reach agreement” involves the employer needing to consider all information presented to them, and to also take reasonable steps to enquire about the employee’s circumstances. The information provided by the Applicant did not particularise in enough detail how the Applicant’s carer demands had changed from his third request (1 day in office; 3 days at home) to his fourth request (4 days at home). The Respondent gave the Applicant several opportunities to provide further information for its consideration, however the Applicant was not forthcoming with providing this further information. Whilst the Applicant was not required to provide ‘extensive evidence’ throughout this process, he did need to demonstrate what his carer responsibilities entailed and how it impacted his ability to attend work in the office (at [60]). Therefore, the Commission was satisfied that FedEx did try to genuinely attempt to reach agreement in understanding the Applicant’s circumstances with the information available to them.
Did the Respondent sufficiently explain the ‘Reasonable Business Grounds’ for Refusing the Request?
The Applicant had submitted the Respondent did not have ‘reasonable business grounds’ to refuse the request due to the fact he was working (effectively) remotely during COVID-19 and that FedEx had not identified how the arrangement would likely decrease efficiency and productivity. The Deputy President found that even though the Act does not limit what ‘reasonable business grounds’ means, it does suggest the employer must demonstrate a likely detriment to the business if they wish to refuse a Flexible Work Arrangement (at [66] – [70]). The likely detriment must also be considered in light of an employee’s personal circumstances so that :
. “…Generic and blanket HR answers are not sufficient alone to establish a reasonable business ground for refusing a request”. .”.
Operational Circumstances of Employer v Personal Circumstances of Employee
In finding the Respondent did have reasonable business grounds to reject the Applicant’s request to work exclusively at home the Commission considered the operational impact on the employer, including the difficulty the employer may have with conducting informal discussions with the applicant when needed (at [78] – [83]). The Applicant’s conduct in ‘causing considerable tension’ in dealing with his Mangers leading up to, and throughout the proceedings was relevant to this consideration. Namely, it made it difficult for the Deputy President to accept the Applicant’s request for him to be working from home indefinitely was practical, until he could provide enough evidence to establish the arrangement of him working from home would not be detrimental to the employer’s operational requirements (at [80]).
This was weighed up with the Applicant’s personal circumstances including the benefits on his ability to care for his family in challenging and difficult circumstances. Ultimately the Commission was not persuaded that working in the office 1 day per week meant that the Applicant could not provide “due care for his family”.
Compounding this issue was the fact the Applicant had refused to trial the Respondent’s offer of 3 days per week at home and 1 day per week in the office. If the Applicant had done so and demonstrated the arrangement did not fit his circumstances, the Commission could have considered more alternatives. However, the Commission found it would be “unfair” to grant the Applicant his request given his lack of cooperation with FedEx in seeking an arrangement which could work for both parties (at [85]).
Final Orders
The Commission made the following Order (at [92]):
- the Applicant be allowed to work from home 3 days per week and in the office 1 day per week;
- if the Applicant does not attend the office for 2 consecutive weeks, there are performance concerns, or there are genuine operational requirements requiring his attendance, then FedEx may lawfully and reasonably request him to work at the office on the days that he is permitted to work from home.
- The order be valid for 3 months from the date of making the order, and will expire on 12 October 2024, which will allow the parties to review the employee’s circumstances and the employer to assess its operational requirements;
- If the Applicant wishes to extend or vary the Flexible Work Arrangement once it expires, he will need to lodge a new request in accordance with section 65 of the Act.
Reasons for decision – not making the Flexible Working Arrangement indefinitely
The Deputy President identified that Flexible Working Arrangements should not be ordered indefinitely without very good reasons to do so.
In this case, the order made was for three months where the primary objective of the Deputy President was to ensure that the Respondent’s proposal was properly trialled.
Conclusion
It will be interesting to see how the Commission deals with similar matters in the future, in particular the flexible approach taken to determining final orders, and the emphasis placed on the conduct of the parties prior to a final decision being made. The case acts as a timely reminder for both employees and employers of the need to ensure strict compliance with the detailed Flexible Working Arrangement legislative regime or risk potentially lengthy proceedings if the matter proceeds to arbitration.
