Emil Ford Lawyers

Unreasonable end to employee seachange

Our workforce is becoming increasingly agile with flexible working arrangements and employees working from home becoming increasingly common. This is certainly true of the charity sector which, according to recent statistics, employs more than 10% of Australia’s workforce, many of whom are employed in a part-time or casual capacity. Although flexible working arrangements are a way of attracting and retaining talented employees and reducing office overheads, they can create problems for employers.

This is illustrated by a recent decision of the Fair Work Commission, where an employer and an employee agreed to an arrangement whereby the employee could work remotely from Byron Bay after the employee’s wife had secured employment in Byron Bay.

The employer insisted that the arrangement was only temporary until the employer opened a new office in the Gold Coast at which point the employee would be required to work from the Gold Coast office. However, the employer later abandoned its plans for a Gold Coast expansion and advised the employee that the working from home arrangement could not continue and that the employee was required to return to Sydney.

The employee refused to return to Sydney and his employment was terminated.

The employee alleged that he had been unfairly dismissed, whereas the employer insisted that the employee had failed to comply with a reasonable and lawful direction.

The principal legal issue was whether the employer’s direction to return to work at the Sydney office was a reasonable and lawful direction. Employees have an implied duty to comply with the reasonable and lawful directions of their employer. This implied duty operates in addition to anything expressly stated in an employer’s employment contract.

The Fair Work Commission ultimately held that the employer’s direction to return to work at the Sydney office was not reasonable and thus there was not a valid reason for the employee’s termination. The employee was awarded $8,350.38 as compensation for his unfair dismissal.

This case is both a reminder of the employer’s right to give reasonable and lawful directions to employees and a reminder to document any special arrangements with employees to provide certainty and enforceable rights and obligations. The Fair Work Commission indicated that the direction may have been reasonable if the working arrangement had been documented in writing subject to certain terms.

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