Greater access to Flexible Working Arrangements, extended unpaid Parental Leave

From 6 June 2023, the Fair Work Commission (FWC) will have new powers to deal with disputes regarding requests for flexible working arrangements and extensions to unpaid parental leave, as the rollout of changes from the Government’s ‘Secure Jobs’ legislation continues.

The changes will introduce dispute resolution provisions, enabling the FWC to make orders where an employer refused an employee’s request for flexible working arrangements, or did not respond to the request, within 21 days, including consideration of whether the employer has reasonable business grounds to refuse a request. Historically, disputes referred to the Commission could only examine whether an employer followed the requisite process in responding to an employee’s request for flexible working arrangements; the FWC was not previously empowered to assess the merits of an employer’s refusal (though discrimination claims could have been pursued through separate channels).

An employer and employee must first attempt to resolve a dispute at the workplace level before the matter can be referred to the FWC for mediation or conciliation. The Commission may arbitrate a dispute without the agreement of both parties, but only after mediation or conciliation has been explored first. When arbitrating a dispute, the Commission will be empowered to evaluate whether an employer had reasonable business grounds to refuse a request and have the ability to order employers to grant requests, or to change working arrangements to accommodate, to any extent, the employee’s circumstances.

The new dispute resolution process will be much the same with respect to disputes regarding requests to extend unpaid parental leave for a further period of up to a year.

In addition, the National Employment Standards (NES) will be amended to expand the circumstances in which an employee may request flexible working arrangements to include employees who are pregnant, as well as situations where an employee, or a member of their immediate family or household, experiences family and domestic violence.

Greater detail will also be inserted into the NES to specify that when an eligible employee makes a request for an extension of unpaid parental leave, their employer has an obligation to discuss the request with them. If their employer refuses a request, the employer will need to provide reasons in writing. The employer will also need to consider and inform the employee in writing if there is any other period of extension they would be willing to agree to. The threshold of “reasonable business grounds” for refusing a request for an extension to parental leave will not change, though examples (e.g. too costly, not possible to change working arrangements of other employees or recruit new staff, that the extended period of leave will negatively impact customer service or productivity, etc) will be added for clarity. The specific circumstances of an employer, including but not limited to the size and nature of an employer’s enterprise, will remain relevant to determining whether an employer has reasonable business grounds to refuse such a request.

When arbitrating a dispute, the FWC will be empowered to issue orders, including an order that the employer grant the requested extension, or agree to a different extension period of up to 12 months, though attempts must first be made to resolve concerns at the workplace level, before being referred to the FWC.