Changes to employee flexible work arrangements from June 2023
Updated October 2023
In late October 2022, the Federal Government introduced draft legislation that would strengthen a worker’s right to flexible work arrangements. On 6 June 2023, the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2023 (Cth) came into effect. We first published this in November 2022 (when the changes were not yet legislated). We have now updated this article to reflect the new flexible working arrangements for Australian workers.
In further reading, we explored a recent case that provides guidance on how the new laws will be interpreted by the Fair Work Commission. You can read “Case review - new flexible work arrangements” here.
As workers have returned to the office and other workplaces in the year since the pandemic, many have wondered whether they have a legal right to work from home. More broadly, parents, carers and other workers often consider whether they have a similar right to flexible working arrangements. We deal with those issues in this article.
There is no doubt that the COVID-19 pandemic changed business and personal attitudes towards remote work, working from home and flexible work arrangements more generally. During 2020 and 2021, millions of Australian workers worked remotely on a regular basis due to the pandemic.
Section 65 of the Fair Work Act – employee requests to change working arrangements
Prior to June 2023, section 65 of the Fair Work Act provides that an employee may request a change to their working arrangements if the employee is:
- a parent, or has responsibility for the care, of a child who is of school age or younger;
- the employee is a carer (as defined by the Carer Recognition Act 2010);
- the employee has a disability;
- the employee is 55 or over;
- the employee is experiencing violence from a member of the employee’s family;
- the employee provides care or support to a member of the employee’s immediate family, or a member of the employee’s household, who requires care or support because the member is experiencing violence from the member’s family.
The employee is only entitled to make the request if they have completed 12 months of continuous service before making the request or, for a casual employee:
- is a regular casual employee who has been employed on that basis for a sequence of periods of employment during a period of at least 12 months; and
- has a reasonable expectation of continuing employment.
A refusal of the employee’s request for flexible work arrangements: no right to appeal
At face value, section 65 of the Fair Work Act sounds promising for employees seeking flexible work arrangements. However, as drafted prior to June 2023, the provision goes on to provide that an employer may refuse the request if they have “reasonable business grounds” to do so.
The section sets out a list of what “reasonable business grounds” include (but are not limited to). This includes that:
- the changes are too costly for the employer;
- the changes are too impractical; or
- the changes cause a significant loss in efficiency, productivity or decline in customer service.
Employers were required to give a written response within 21 days of the employee’s request for flexible work arrangements stating whether or not it was granted. If it was not granted, the employer had to include details of the reasons for the refusal.
Unfortunately, as things stood at that time, section 65 of the Fair Work Act did not provide any avenue for an employee to appeal a refused request. This inability proved to be a significant weakness in the right provided in the legislation.
New laws from June 2023: genuine efforts and the right to appeal a refusal
On 6 June 2023, the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2023 (Cth) came into effect. The Act introduced new sections 54A, 65B and 65C.
Under the new sections, an employer may only refuse a request for flexible work arrangements if it has:
- discussed the request with the employee;
- genuinely tried to reach an agreement with the employee about making changes;
- had regard to the consequences of the refusal for the employee; and
- the refusal is on reasonable business grounds.
The employer does not need to agree to the arrangements if it has reasonable business grounds for refusing a request for the change, so long as it has satisfied these additional steps.
The new sections provide that the employer must set out the particular business ground it relies on for refusing the request and explain how those grounds apply to the request. The employer must set out changes (other than the requested change) that it is agreeable to or state that there are no changes it is agreeable to.
Right to appeal to the Fair Work Commission
The new sections also provides the opportunity for an employee to refer (appeal) the matter to the Fair Work Commission if:
- the employer has not responded to the request within 21 days or has refused the request; and
- discussions at the workplace level to resolve the dispute have been unsuccessful.
Once the matter is before the Commission, a conciliation will be held to attempt to resolve the matter. If not resolved, the matter can proceed to arbitration from which the Fair Work Commission may order that:
- if the employer has not given the employee a written response, the employer is assumed to have refused the request;
- if the request was refused, that the grounds on which it was refused were reasonable business grounds;
- if the request was refused, that the ground on which it was refused were not reasonable business grounds;
- the employer gives the employee a written response to the request;
- the employer gives the employee details, or further details of the reasonable business grounds relied on;
- any other order that the Fair Work Commission considers appropriate to ensure compliance by the employer of its obligations in relation to genuine efforts; and/or
- an order that the employer grant the request or make specified changes to the employee’s working arrangements.
Employees’ right to flexible work arrangements will be strengthened
Prior to June 2023, the right to flexible work for carers, disabled workers and employees subject to domestic violence is relatively weak. This was because section 65 of the Fair Work Act entitled an employer to refuse a request on “reasonable business grounds”. Further, there is no right for an employee to appeal the employer’s decision.
The new laws change the operation of the civil remedy provisions. They make contraventions of sections 65 and 65A a civil remedy provision. This makes the provision consistent with the Court’s powers regarding breaches of other provisions in the NES.
The new laws strengthen an employee’s right to flexible work in three key ways.
- Firstly, they impose a greater obligation on employers to make genuine efforts to reach an agreement with the employee. Employers must discuss the request with the employee, genuinely try to reach an agreement and have regard to the consequences of a refusal on the employee.
- Secondly, employees have the option of appealing an employer’s refusal (or failure to respond) to a request, to the Fair Work Commission. The Fair Work Commission is empowered to make a range of orders when dealing with such an application.
- Finally, the new laws make it a civil remedy provision for an employer to contravene the requirements, giving an employee the right to sue in a Court and seek the imposition of a penalty.
These changes fill gaps in the previous employment laws and strengthen the right of certain employees to flexible work arrangements. Employees who are carers, disabled or subject to domestic violence have had their rights strengthened.
Get help from an employment lawyer
Getting good advice quickly when such issues arise at work is critical. Hall Payne are award-winning employment lawyers. If you’re experiencing any issues related to your employment, you should seek assistance from your Union or a lawyer experienced in workplace law.
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This article relates to Australian law; either at a State or Federal level.
The information contained on this site is for general guidance only. No person should act or refrain from acting on the basis of such information. Appropriate professional advice should be sought based upon your particular circumstances. For further information, please do not hesitate to contact Hall Payne Lawyers.
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