In today’s workplace, the right to flexibility at work is not only protected by both federal and state laws, but notions such as “flexible work practices” and “work – life balance” are commonly pitched by employees in their increasing requests for flexible working arrangements.

As a general rule, employers can only reject an employee’s request for flexible working arrangements on “reasonable business grounds”, which is now helpfully defined in the Fair Work Act 2009 (Cth) (Fair Work Act), and extends to considerations including cost, practicality and capacity. 

The concept of “reasonable business grounds” was considered by the Fair Work Commission (FWC) last week in an unfair dismissal case in which the employer had refused an employee’s request to return part-time after maternity leave.

Facts giving rise to request

After several periods of maternity leave commencing in February 2011, in May 2015 the full-time Business Development Executive requested that she return to work on a part-time basis. Upon considering the request, the employer, a travel agency, responded that the business was unable to facilitate the request as it would be “unable to maintain the necessary service standards and expectations within the sales division“. In short, (and despite recognising the employee’s long tenure), the employer stated that it could not offer the employee her pre-maternity leave position on a part-time basis, nor were there any current part-time roles of a similar level available. The employer gave the employee two options: to accept her pre-maternity leave position on a fulltime basis or to resign. The employee unwillingly chose the latter.

Employee’s right to request

In this case, the employee’s right to request flexible working arrangements arose under the parties’ enterprise agreement. Similarly to the general right to request provisions of the Fair Work Act, this agreement provided that the employer could only refuse a request from an employee returning from parental leave to work part-time until their child reached school age on “reasonable business grounds”. The agreement stated that such grounds “might include cost, lack of adequate replacement staff, loss of efficiency and the impact on customer services“.

No forced resignation by Employer

The FWC took into account evidence from the employer’s general HR manager regarding the business reasons for the employer’s refusal to convert the employee’s employment status to part-time.

The FWC ultimately determined that the employer’s refusal to accommodate the request was reasonable. The FWC also noted feedback received by the company from travel agents to the effect that there was a need for the Business Development Executive to be available on a fulltime basis.

The FWC rejected the employee’s argument that it was the employer’s action in denying her request that forced her to resign. Despite sympathising with the employee’s circumstances, the FWC considered that it was more likely the employee’s own personal circumstances, rather than the employer’s action in denying her request, that lead the employee to resign.

Responding to requests for flexibility

This decision will no doubt comfort employers who wish to rely on the “reasonable business grounds” exception to refuse employee requests for flexible working arrangements. However, employers need to carefully assess individual requests for flexibility against business roles and needs, and their own internal policies. When responding to requests, employers should also be mindful of formal requirements required under the Fair Work Act or an applicable industrial instrument.

Employers should also consider how flexibility might provide an opportunity, rather than a cost. Australian employers are increasingly seeking competitive advantage through flexible workforce arrangements not only through retaining and incentivising talent, but also through lowering overheads associated with a static office based workforce.

See: Ms Catarina Reale v Helloworld Ltd T/A Qantas Holidays and Viva Holidays Ltd [2015] FWC 7122