It is now common for businesses to operate hybrid and work-from-home models. But perhaps the tide is turning.
Employers are beginning to retreat from their post-Covid flexible working policies and many, including the whole public sector, are considering reimplementing in-office mandates.
Putting to one side the arguments about productivity, wellbeing and the like, a recent case is a reminder employers and employees will not always see eye to eye about where work should be performed.
In Petrie v Alphero Ltd the Employment Relations Authority (ERA) considered a claim involving a dispute about remote working arrangements. Whether Alphero Ltd (the employer) had agreed to certain flexible working arrangements was the key issue, as Mr Petrie (the employee) argued he was unjustifiably (constructively) dismissed when he resigned. He said that was because Alphero breached a prior remote-working agreement. Mr Petrie had recently moved to Whanganui, whereas Alphero’s office was in Wellington.
The ERA ultimately held Mr Petrie was not unjustifiably disadvantaged, constructively dismissed or subjected to a breach of good faith when Alphero altered an arrangement of four days at home and one in the office to three days a week in the office and two at home.
Mr Petrie started working for Alphero in December 2021. He initially worked fully from the office but not long after starting, began to work one day per week from home.
Covid-19 concerns in late January 2022 meant all Alphero staff were permitted to work from home for a period. Seemingly, Alphero had agreed remote and hybrid working arrangements with many of its staff. Some of these were formally agreed, some were project-specific and some were informal policy decisions at Alphero’s discretion.
In the second half of 2022 Alphero updated its flexible working policy.
The policy confirmed existing work-from-home agreements did not need to be renegotiated.
Mr Petrie was working on a project for Alphero’s client TVNZ.
The unique characteristics of that project, and TVNZ being a remote client, meant there was project-specific flexibility where staff were permitted to work four days remotely and one day in the office (described as being a “4:1” basis).
But the project-specific flexibility was exactly that limited to that project. Alphero’s communications about it were consistent, being that employees working on the TVNZ project were able to work from home for longer “but not forever”. The employer’s communications also appear to have reserved its right to require employees to work from the office more regularly.
In late 2023 Mr Petrie’s new manager resolved to have one-on-one discussions with staff reporting to him, including about flexible working arrangements.
Around this time Mr Petrie had bought a home in Whanganui. He had not told Alphero about his plan to move to Whanganui.
Mr Petrie then requested a fully remote working arrangement.
Shortly prior to Christmas 2023, Mr Petrie’s manager reiterated Alphero could not support fully remote working arrangements on a permanent basis.
Alphero agreed to provide a temporary flexible-working arrangement until March 2024.
It seems Alphero anticipated Mr Petrie was looking for alternative (remote) work and that he would likely resign from his role. That is understandable, given Mr Petrie was now living in Whanganui and appeared reluctant to travel to Wellington for work.
Some confusion arose, and Mr Petrie clarified he was not intending to resign. In turn, Alphero sought to clarify that it was not agreeing to a permanent flexible working arrangement, and that it required Mr Petrie from the beginning of April to start working three days a week from the Wellington office.
Mr Petrie resigned about a month later.
He then raised a personal grievance, alleging he had been unjustifiably (constructively) dismissed and had been unjustifiably disadvantaged by the employer requiring him to work from the Wellington office.
The ERA found the “4:1” arrangement was only a temporary arrangement, contingent on the employee being engaged on the specific TVNZ project and the employer’s needs.
The employer retained the discretion to rescind the temporary arrangements and to direct employees to work from the office in accordance with its own policies. Alphero had been open and transparent in the way it communicated about flexible working arrangements, and it had not arbitrarily removed the flexible working arrangements solely in response to Mr Petrie buying a house in a different city.
Given those findings, Mr Petrie had not been unjustifiably disadvantaged and it followed his constructive dismissal argument must also fail as it was predicated on the employer having breached a prior arrangement about flexible working.
The key lesson for employees and employers is to get on the same page about what is agreed and what is not.
If both parties are happy with informal flexibility then that is fine, but an employee who decides to move cities assuming they will be able to work remotely certainly takes a risk their employer will not agree.
Formal arrangements should be documented. Parties to an employment relationship should approach discussions in good faith, openly and transparently.
Part 6AA of the Employment Relations Act 2000 includes a statutory right to make a flexible working request, which employers must consider and decide whether to approve or refuse.
There are good reasons for flexibility, but there are also good reasons for requiring staff to work from the office.
Proponents of in-office work say many types of work are less effectively done remotely.
Benefits of in-office work include collaboration, connectivity, innovation, mentorship and skill development.
But employers should also recognise that one size will not fit all, and policies should include the flexibility to respond to individual circumstances. The worst outcomes and the highest likelihood of grievances and disputes will be from employers communicating poorly or failing to explain why they made the decision they did.
• The opinions expressed in this article are those of the writer and do not purport to be specific legal or professional advice. James Cowan is a senior associate with Anderson Lloyd, specialising in Employment Law.
