What’s Changed in the Flexible Work Arrangements Space?

In today’s dynamic work environment, flexibility is key… and employees have always had rights to request flexible work arrangements. Employees seek ways to balance their professional responsibilities with personal life, and employers recognise the benefits of accommodating these needs.

However, changes to the Fair Work Act 2009 since June 2023 have expanded the employee rights in relation to flexible working arrangements. One of the big changes in this regard is the power for the Fair Work Commission to arbitrate an outcome if the employee lodges a claim because the employee and employer cannot come to an agreement.

In this week’s Akyra blog, we explore recent changes to flexible working arrangements, and consider how employers can navigate challenges associated with these arrangements.

Who is eligible to request a flexible work arrangement?

Before diving into changes and challenges associated with flexible working arrangements, it is first important to identify who is eligible to request a flexible work arrangement. This includes:

• Full-time and part-time employees who have worked with the same employer for at least 12 months.
• Eligible employees include parents, carers, persons with disabilities, older workers, pregnant individuals, and those experiencing family and domestic violence.
• Casual employees meeting specific criteria can also request flexible arrangements.

The flexible work arrangements that can be requested include hours of work (adjustments to start and finish times); patterns of work (split shifts, job sharing or compressed work weeks) and location of work (hybrid or remote work).

What does the request process look like and what are the recent changes?

Prior to June 2023, an employee could write to their employer requesting a flexible work arrangement and on what grounds the request was being made – e.g. parenting responsibilities. The employer was required to respond in writing within 21 days of the request being made and could refuse the request on reasonable business grounds.

Since June 2023, there are additional grounds on which an employee can make a flexible work arrangement request. There is much more emphasis on the process the employer engages in when responding to any employee flexible work arrangement request and there are greater powers that will allow the Fair Work Commissioner to arbitrate if an employer does refuse a flexible work arrangement request.

The additional grounds include pregnancy or if the employee or someone in their immediate family or household is experiencing family and domestic violence.

The employer may very well grant the flexible work arrangement request because it works for both the employee and the business operations.

What does refusal of a flexible work arrangement request look like?

In some situations, it may not be possible to accommodate an employee’s flexible work request.

However, before refusing any request for a flexible work arrangement, the employer must discuss potential options with the employee and genuinely try to reach an agreement. The employer can only refuse on reasonable business grounds and would need to strongly consider the consequences if the flexible work arrangement request is refused. Reasonable business grounds may also include the nature and size of the business.

If the flexible work arrangement request is refused, the employee can now lodge a claim with the Fair Work Commission who can make orders for the employer to provide the employee a written response (if they have not done so), determine whether the ‘reasonable business grounds’ are in fact reasonable and even make orders requiring the employer to grant the request.

The employer must still respond to the flexible work arrangement request within 21 days, ensure they undertake consultation with the employee, explore the reasonable business grounds there might be for refusing a request and then respond to the employee setting out the process the employer has undertaken, the reasonable business grounds for refusal and why those reasonable business grounds apply in the particular circumstance – all within the 21-day timeframe.

The flexible work arrangement request refusal might be proposing alternative arrangements and detailing the changes the employer is willing to make to accommodate the employee’s request that will also work practically for the business operations.

If the employer does not respond within the 21 days, that will be seen as a refusal of the flexible work arrangement request and provide an opportunity for the employee to lodge a claim with the Fair Work Commission.

What are reasonable business grounds for refusal?

Section 5A of the Fair Work Amendment Act 2013 details what refusal on reasonable business grounds might look like:

• the new working arrangements would be too costly for the employer;
• there is no capacity to change working arrangements of other staff to accommodate the request;
• it would be impractical to change the working arrangements of other employees or recruit a replacement employee to accommodate the employee’s request;
• the new arrangements would be likely to result in a significant loss or productivity or efficiency;
• the new arrangements would be likely to have a significant negative impact on customer service.

Key Takeaways