Proposed working from home clause in the Clerks Award

The Fair Work Commission (FWC) has made a decision regarding working from home (WFH) rights under the Clerks — Private Sector Award 2020 (Clerks Award) after initiating proceedings in 2024 to consider, among other things, whether modern awards were ‘fit for purpose’.

FWC’s findings and decision to vary the Clerks Award

The FWC found that:

• WFH arrangements for employees covered by the Clerks Award are ‘widespread’ and are in many cases the result of ‘employer initiatives’ rather than arising from employee requests.
• Employees who are WFH, to meet their individual circumstances, are choosing to adjust their working conditions in ways that are not consistent with the Clerks Award. This includes variations such as employees working outside the spread of ordinary hours, taking breaks at varying times and working on weekends.
• These variations have likely resulted in inadvertent non-compliance with the Clerks Award by employers, including underpayment. Although the FWC did not indicate that enforcement action had occurred, it found that: “many arrangements which have already been implemented are likely to be inconsistent and non-compliant with particular provisions of the Clerks Award. If, at some future time, this results in enforcement action, that will likely disrupt many working from home arrangements and perhaps impede their continuation.”

The FWC’s decision to vary the Clerks Award will allow for the consensual adjustment to various clauses in the Clerks Award to facilitate individual WFH arrangements which are designed to prevent inadvertent breaches of the Clerks Award, including underpayment by employers.

The changes are as follows.

A right to request

The proposed WFH Clause does not provide employees covered by this clause with an automatic right to work from home. It only provides these employees with ‘a right to request’ a work from home arrangement.

The FWC found that WFH arrangements are already widespread and that the evidence in the proceeding did not support the contention that WFH requests are commonly rejected by employers. Also, where rejections did occur, to a significant degree, they were not made on an “…arbitrary, capricious or discriminatory ground”.

The effect of the proposed WFH Clause is that a business:

• may reject a WFH request;
• is not required to provide reasons for a rejecting a request; and
• is not required to base any rejection on ‘reasonable business grounds’.

However, an employee may still be eligible to request a flexible working arrangement (including WFH arrangements) under section 65 of the Fair Work Act 2009 (Act). A request under this section requires a business to respond appropriately, including basing any rejection of the request on ‘reasonable business grounds’.

Modification of the application of various terms in Clerks Award

The FWC intends for the proposed WFH clause to facilitate working from home arrangements for employers and employees. The FWC stated that it aims to promote “…flexible modern work practices by allowing consensual adjustments to award provisions, to support contemporary working from home arrangements”.

The FWC was presented with evidence that existing mutually agreed WFH arrangements have led to widespread (and often inadvertent) non-compliance with the Clerks Award.

Therefore, the proposed WFH Clause will allow employers and employees to agree to adjust the application of various clauses in the Clerks Award, including:

• the working of ordinary hours continuously under clause 13.6(a);
• the working of ordinary hours at the discretion of the employer in accordance with this award under clause 13.6(b);
• when rest breaks may be taken under clause 15.2; and
• when meal breaks may be taken under clause 15.3.

(For all terms that could be varied, please refer to the full proposed variation.)

Allowing the variation of these and other terms by employers and employees with a WFH arrangement that meets an individual’s circumstances will prevent employers from breaching the Clerks Award.

Disputes

The proposed WFH Clause will provide that any disputes about a WFH request will be dealt with under clause 40 of the Clerks Award, ‘Dispute resolution’.

Under clause 40, the FWC can be requested to deal with a dispute through mediation, conciliation or voluntary arbitration. This means an employer can refuse a request by an employee for the FWC to arbitrate a WFH dispute.

We note that whilst a dispute is ongoing, work must continue in accordance with the Clerks Award and the Act i.e. an employee cannot work from home unless permitted by the employer even if a dispute is ongoing.

Work outside of the ordinary spread of hours

The FWC has made it clear that the Clerks Award provides that work undertaken by an employee outside of the ordinary spread of hours (for example, overtime or on a Sunday) only attracts the applicable loading rates when an employee is explicitly directed by the employer to undertake this work, or from a necessity arising from the employer’s work requirements.

These entitlements are not payable to an employee who undertakes work during these times due to their personal preference or convenience.

Allowances

The uniform laundry (Clause 19.4 (d)), first aid (Clause 19.2(b)) and overtime meal allowances (Clause 19.5) all remain unchanged and cannot be varied under the proposed WFH Clause.

Therefore, these allowances, where applicable, will remain payable to an employee even if they are working from home.

Implementation

The implementation of the proposed WFH Clause will take effect immediately following a review of further submissions made in response to the FWC’s proposed WFH Clause (a copy of the proposed WFH Clause can be found here). The FWC has indicated that the proposed WFH Clause may act as a model clause for other awards.

Impact on business

If the proposed WFH Clause comes into effect, then businesses should ensure:

• any WFH arrangement under the clause is made in writing and is kept as a time and wages record;
• it understands that a dispute under the clause may be taken to the FWC, but arbitration can only occur with the consent of both parties;
• allowances under the Clerks Award will remain unchanged and will be payable irrespective of a WFH arrangement; and
• it is aware that an employee will have other avenues to seek a WFH arrangement and a request under other legislation requires an appropriate response.

Contact us

If you have any questions about the FWC’s proposed WFH Clause and how these changes will impact your business, please contact a member of our Workplace Relations team.