Since COVID, many employees and workplaces have adopted non-traditional, flexible methods of work. This has been through employer directions or informal arrangements. On 6 June 2023, the flexible working arrangements entitlement under the Fair Work Act (FW Act) expanded, meaning employees are now entitled to ask for a formal flexible working arrangement. There are important changes to the process and timeframes that an employer must follow. 

An employer is required to undertake additional steps in responding to these requests – and if there is a failure of the employer to respond, or if there is a dispute about the arrangement, the Fair Work Commission (FWC) can engage in dispute resolution and arbitration which can include the FWC deciding what arrangement should be put in place.  

Employers should ensure their policies and procedures are updated in line with these changes and arrange training for their managers and supervisors to ensure they don’t unnecessarily end up in the FWC.  

What are flexible working arrangements under the FW Act?  

Flexible working arrangements are part of the National Employment Standards (NES) – the minimum standards which apply to all employees, regardless of if they are covered by an award, an enterprise agreement or a contract.  

Section 65 of the FW Act allows certain employees to request a change in working arrangements if the employee: 

• is pregnant; 
• is the parent, or has the responsibility for the care, of a child who is of school age or younger; 
• is a carer; 
• has a disability;  
• is 55 or older;  
• is experiencing family and domestic violence; or  
• 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 family or domestic violence; and  

because of those circumstances, the employee would like to change their working arrangements.  

To be eligible, an employee must be employed for 12 months’ continuous service before making the request. If they are a casual employee, they must be employed as a regular casual employee for at least 12 months before making the request and there must be a reasonable expectation of continuing employment on a regular and systematic basis.  

The employee must make the request in writing and set out the details of, and reasons for, the change. 

An employee’s request could come via email, text or a handwritten letter – any of these are likely to satisfy the requirement that the request be made in writing. It could be given to their direct manager, HR or a supervisor. Regardless of the form it arrives in, the employer must respond promptly and follow the correct process.   

Examples of arrangement requests 

An employee could request any number of arrangements – for example, they want to start 30 minutes later and finish 30 minutes later on Mondays so they can take their child to kindergarten, or they want to work from home every second Wednesday to ensure they can take their elderly mother to her doctor’s appointment during their lunch break. The arrangement request could be anything including working-from-home days, flexible starting and finishing times, transitioning to part-time work, or a nine-working-day fortnight.   

How should the employer respond?  

Firstly, a written response must be provided to the employee within 21 days.  

That’s 21 days from the date the request is received. Before responding to the request, an employer has a number of obligations. 

If the employer can accommodate the request, a written response confirming the arrangement needs to be sent.    

However, if the employer cannot accommodate the request, it becomes more difficult.  

In this case, they must first have a discussion with the employee, and genuinely try to reach an agreement to accommodate for the circumstances the employee has outlined. An agreement can be reached which can be different to what was originally requested by the employee, if it is genuinely agreed to by all parties.  

If an agreement still cannot be reached and the employer has had regard to the consequences of the refusal on the employee, a request can be refused but only on reasonable business grounds.  

What does ‘reasonable business grounds’ mean? 

The FW Act provides some reasonable business grounds which an employer can seek to rely on, including: 

• The arrangements would be too costly;  
• No capacity for other employees to accommodate the arrangements requested;
• Impractical to change the arrangements of other employees or recruit new employees to accommodate the arrangements;
• The arrangements would likely result in a significant loss in efficiency/productivity;
• Arrangements would have a significant impact on customer service.  

If the employer is refusing the request on one of these reasonable business grounds mentioned above, they must provide a written response which includes details of the reasons for refusal, including those business grounds and how they would apply to the changes. The employer must also provide either the changes the business is willing to offer or that the business is unable to offer any changes. If the employer is unable to accommodate the request, they may also need to provide information about the FWC’s ability to deal with the dispute.  

What if an employer refuses the request?  

The FW Act not only provides an entitlement to ask for a flexible working arrangement but also options for dispute resolution where there is not an agreement. 

If an employer refuses to accept a flexible working arrangement or does not provide a written response within 21 days of receiving the request, the disputes resolution section of the FW Act will be enlivened.  

Firstly, employers and employees must try to resolve the dispute in the workplace through discussions. However, if that does not work, either party can refer the dispute to the FWC who can then deal with the dispute by means other than arbitration.  

The FWC can determine that if no written response was given in 21 days, it is assumed the employer has refused the request.  

Where no response has been given, or the employer has refused the request, the FWC can make orders that: 

• the refusal was on reasonable business grounds, or was not on reasonable business grounds;
• the employer takes further steps the FWC considers appropriate as there is no reasonable prospect of the dispute being resolved; 
• and if the FWC has ordered that there is no reasonable prospect of resolving the dispute, it can make further orders that require the employer to:
  - grant the request; or
  - make specified changes that the FWC determines to be appropriate. 

Dealing with flexible working arrangement requests in a timely, well-considered manner is important as the FWC has the power to arbitrate requests and can force the employer to comply with the requests anyway.  

How should employers deal with flexible working arrangements? 

Being prepared to deal with flexible working arrangements is the best way to ensure you will be able to handle them efficiently and thoroughly to minimise the risk of ending up in the FWC.  

Employers should train their managers and supervisors in what to do if they receive a flexible working arrangement request, including designating a person who is responsible for managing providing a written response within 21 days, and setting up meetings to have the required discussions under the FW Act. They should also set out clearly who has the authority to grant requests of employees, and ensure those people are notified as soon as possible when requests are made.   

Having policies or procedures in place which outline to employees the best way to make flexible working arrangements requests can assist employers in managing requests and help direct requests to the most appropriate person.  

If you receive a request from an employee, and are not sure if you can accommodate it, getting some legal advice on whether a refusal could be on reasonable business grounds is important. For example, just because an arrangement might have some cost to the business to accommodate it, does not mean that it is necessarily ‘too costly’ under the FW Act, and may constitute an unreasonable refusal of a request. 

It is critical employers ensure their business has policies and procedures in place to deal with these requests and your employees, especially managers and supervisors, are trained to respond appropriately.  

CCIWA can assist you with any questions you might have regarding policies and procedures, training of staff, advice on requests that you have received, and representation in dispute resolution and arbitration proceedings in the FWC.  

If you have any questions about flexible working arrangements, contact our Employee Relations Advice Centre on 9365 7660 or email [email protected] or if you would like to speak to one of our employment lawyers, email [email protected]