Amendments to requests for flexible working arrangements took effect on 6 June 2023 as part of the suite of changes introduced by the Fair Work Legislation Amendment (Secure Jobs Better Pay) Act 2032 (Cth).
In summary, those changes include the broadening of the reasons that employees can request flexible working arrangements to include pregnancy, the requirement for more information to be provided by employers in refusing a flexible work request, and the introduction of a new jurisdiction in the Fair Work Commission (the Commission) to deal with disputes relating to requests for flexible working arrangements.
So what are flexible working arrangements?
The Fair Work Act 2009 (Cth) (FW Act) acknowledges that there will be some employees who may require flexible options in their employment, and provides the right for those employees to request such flexibility by way of flexible working arrangements.
To be eligible to make a request for flexible working arrangement an employee must first meet the test for service, which is:
- for full-time and part-time employees, they must have completed 12 months of continuous service with their employer; or
- for casual employees, they must have been employed on a regular and systematic basis for the previous 12 months, and have a reasonable expectation of continuing employment.
If an employee has the requisite service period, the employee can apply for flexible working arrangements if they would like to change their working arrangements because they:
- are pregnant (this was not previously an eligible reason prior to 6 June 2023);
- are a parent, or have carer’s responsibilities for a school age (or younger) child;
- are a carer;
- have a disability;
- are 55 years of age or older;
- are experiencing family and domestic violence, or
- are providing care or support to an immediate family member of household member because that person is experiencing domestic violence.
There is no specific arrangement that must be made. What will suit one employee’s circumstances will not always suit another, and the provisions are intended, as the name suggests, to be flexible. However, by way of example, arrangements may include:
- changes to start and finish times;
- changes to where work is performed; and/or
- changing the number of hours of work performed by the employee.
It is important to note that a request for flexible working arrangements should be made by an employee in writing, and must set out the changes sought and the reason for the change.
Responding to a request for flexible work
Employers must respond to a valid flexible working request within 21 days of the request being made, either by:
- accepting the arrangement proposed by the employee;
- suggesting an alternative arrangement; or
- refusing the request.
Before responding to a request for flexible working arrangements, other than by accepting their request, it is essential that the employer meets with the employee to discuss the request and to genuinely attempt to reach an agreement with the employee about their request to accommodate the reason they have made the request.
A request for flexible working arrangements can only be refused on reasonable business grounds.
Reasonable business grounds
The FW Act provides an indicative list of what may constitute reasonable business grounds. The list includes:
- that the arrangement would be too costly;
- that there is no capacity to change the working arrangements of others to accommodate the request;
- that it is impractical to change the working arrangements of others to accommodate the request;
- that the request would result in a significant loss in efficiency or productivity; and/or
- that the request would have significant negative impacts on customer service.
The above list is not exhaustive and there may be other reasons specific to each employer that may constitute reasonable business grounds.
If an employer intends to refuse a request for flexible working arrangements
When responding to a request for flexible working arrangements, other than by acceptance, the employer is required to:
- identify the reasonable business grounds on which the employer relies in declining the request;
- set out how those business grounds apply to the specific request by the employee;
- specify any other arrangements that the employer would be willing to make to accommodate the employee’s request;
- if no other changes can be made, state that; and
- advise the employee of their right to initiate a dispute in the Commission regarding the refusal (see below).
For each of these reasons, a request for flexible working arrangements should only be refused once the employer has considered all alternative options that may be available, discussed those with the employee, and still not been able to reach agreement with the employee.
New Fair Work Commission jurisdiction
Under the changes that took effect on 6 June 2023, the Commission now has the ability to receive an application to resolve a dispute about flexible working arrangements from an employee who has not received a response to their request, or whose request has been refused by their employer.
If the Commission receives an application, the employer will be provided with the application and be asked to provide a response. The matter will then be given to a Commission Member. The FW Act provides that the matter must not be dealt with by arbitration initially, unless there are exceptional circumstances, which means that in all likelihood, a conciliation conference or mediation will be facilitated by the Commission Member, to attempt to resolve the matter as a first step.
If the matter proceeds to arbitration, the Commission can make any of the following orders:
- That the employer is taken to have refused the request, if they have not responded;
- That the reason(s) for the refusal are reasonable business grounds;
- That the reason(s) for the refusal are not reasonable business grounds;
- That the employer respond, or provide more detail to their response;
- That the flexible working request is granted;
- That the employer make other changes to facilitate the request.
The orders noted in items 5 and 6 above may only be made if the Commission is satisfied that there is no reasonable prospect of the dispute being resolved without the making of such an order.
Failing to comply with an order made by the Commission will contravene the civil penalty provisions in the FW Act and may result in the imposition of civil penalties against the employer and individuals knowingly involved in the contravention.
What Employers Need to Do
As flexible working arrangements are provided in the National Employment Standards, all employees should familiarise themselves with the grounds for requesting flexible work and the process for responding to a request, particularly the requirements when refusing a request for flexible working arrangements. This is also a good opportunity to revise any relevant employer policies.
If you need any assistance with understanding the changes, or responding to an employee who has made a request for flexible working arrangements, please contact us.
Written by Kate Gibson and Nicole Dunn