Loss in productivity identified as reasonable business ground in employer’s decision to refuse a work from home request
The holiday break is a good time to reset and spend quality time with your nearest and dearest. The perfect opportunity to make new memories with old friends and family. It’s a time for awkward Santa photos, bowling slow balls for Nan in backyard cricket and carols led by Mariah Carey. With this in mind, you would be forgiven for missing an interesting decision by the Fair Work Commission (FWC) in Gregory v Maxxia Pty Ltd  FWC 2768 involving an employer’s decision to refuse a request for an employee to work from home.
Let us catch you up.
The Employer provides salary packaging advice and assistance to employers. The Employee was employed by the Employer as a Business Development Manager. His employment contract required his attendance at the Employer’s premises, but he was permitted by the Employer to work from home during the COVID-19 pandemic.
In August 2023, the Employee applied for a flexible working arrangement (FWA) where he sought to work 100% of his working hours remotely. The reasons for the application included the Employee’s parental responsibilities and his “inflammatory bowel disease” (which was supported by a letter from his doctor). In response to the request, the Employer proposed that the Employee work 20% in the office until the end of September 2023. The Employer suggested that the Employee then work 40% of his time in the office after September 2023 and offered him the ability to allocate his office days each week to accommodate the days he would have custody of his child, but the Employee rejected this proposed arrangement.
The Employee filed an application for the FWC to deal with a dispute pursuant to section 65B of the Fair Work Act 2009 (Cth) (Application) in respect of the request for a FWA in September 2023.
The Employer submitted that the decision to reject the request was on the basis of multiple factors, including for example:
- client expectations of service delivery and productivity;
- the Employee’s daily productivity at the time of the request was 50%, which was significantly below the requisite 80% target;
- it would be beneficial to observe and support the Employee in the office;
- the Employee’s tenure with the Employer was valuable and contributed to team culture, training and discussions for the benefit of his colleagues;
- fairness and consistency across the team in respect of remote work.
In considering the Employee’s reasons for requesting the FWA, the FWC determined that his medical condition was not covered as a “disability” for the purposes of s 65(1A)(c) of the FW Act. As a result, the FWC did not have jurisdiction to deal with the Employee’s Application on the basis of this ground. However, the FWC confirmed that it did have jurisdiction to consider the Application on the basis of the Employee’s family responsibilities.
The FWC identified that, while the Employee had a reasonable basis for proposing the FWA for the week that he would have care of his child. However, the FWC noted that the Employee was not the primary carer in the second week and that the Employer had made a genuine attempt to compromise with the Employee. As a result, the FWC held that the Employer had reasonable grounds in refusing the Employee’s FWA request for 100% remote work.
In making findings that the Employer had reasonable grounds for rejecting the FWA request Commissioner Platt held the following:
“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 Mr Gregory’s productivity and provide him with greater support. I accept that Mr Gregory’s knowledge and experience could be more easily accessed by less experienced team members on a face to face basis.”
While each request for a FWA will turn on its distinct facts, it is apparent from the above that productivity and cultural factors may be sufficient to demonstrate reasonable grounds for refusing a request to work remotely.
The FW Act was amended in June 2023 to provide employees with further support in relation to requests for flexible working arrangements. These amendments have resulted in further obligations on employers to undertake additional steps before making the decision to refuse a FWA (for example, before refusing the request, employers must meet with employees to discuss and consider alternative working arrangements with them). As a result, it is important for employers to consider these obligations in relation to flexible work requests and carefully consider the reasons it provides for refusing a request.
If you require assistance in respect of any of the recent changes to the FW Act or flexible work arrangements, please let us know.