Flexible working arrangements are a hot topic in the media following the recent Fair Work Commission decision involving Westpac Bank (Karlene Chandler v Westpac Banking Corporation [2025] FWC 3115) (the Westpac Case). Here’s a snapshot explaining what flexible working arrangements are, common pitfalls for employers and learnings from the Westpac Case.
A recap of flexible working arrangement requirements
Employees with at least 12 months of continuous employment can request in writing to change their working arrangements if they:
- are pregnant,
- are the parent or carer of a school-aged child (or younger),
- are a carer,
- have a disability,
- are 55 years or older,
- are experiencing family or domestic violence or provide support to a family member experiencing it.
Flexible working arrangements can include a change in work hours or the pattern of work, remote work, additional breaks or other flexibilities.
An employer must respond in writing within 21 days of receiving a written request. Within this period, the employer must discuss the request with the employee and genuinely try to reach some agreement, considering the employee’s circumstances and the effect a refusal would have on the employee.
If the employer refuses the request, they must have clear and tangible reasonable business grounds, including:
- it would be too costly;
- it would be too impractical or the working arrangements of other individuals can’t be changed;
- efficiency or productivity would be impacted significantly;
- a significant negative impact on customer service.
An employee can apply to the Fair Work Commission (FWC) if an employer hasn’t met its procedural requirements, or where their request has been refused. The FWC can conciliate and arbitrate these claims.
The Westpac decision
1. The facts
Ms Chandler was a part-time employee in Westpac’s Mortgage Operations team. When she first commenced employment, she was based at the Kogarah corporate office; however, from 2018 she worked one day a week in the corporate office and in 2022, only one day per month, via agreement.
Westpac has a Hybrid Working policy which requires employees to attend the corporate office 2 days per week. When Westpac sought to begin transitioning Ms Chandler to work in accordance with the policy, she made a written request to work from home so she could pick up and drop off her children and care for them. The closest corporate office to Ms Chandler was a 2-hour drive from her children’s schools.
In March 2025, Westpac refused Ms Chandler’s request without giving a reason. After further discussions, Westpac’s position remained that Ms Chandler should complete a phased return to the corporate office 2 days per week by January 2026 because, among other things, working from home is no substitute for childcare.
At the FWC, Westpac relied on its Hybrid Working Policy applying to all staff. They argued that the requested arrangements would likely result in a significant loss in efficiency and productivity or negatively impact customer service, but couldn’t show how this would occur
2. What happened?
The FWC was critical of Westpac’s response to Ms Chandler’s request: the response was not within 21 days, they did not genuinely attempt to reach an agreement and did not consider the consequences of the refusal on Ms Chandler.
Ms Chandler’s role and performance were not affected by her remote working arrangement, which had been in place for years. This was demonstrated by the team’s high performance and her individual high-performance ratings. There were also other staff in the broader team working remotely across different states.
While the FWC confirmed, and Ms Chandler accepted, there were beneficial reasons for her to be in the office some of the time, it was found that the evidence did not establish the reasonable business grounds relied on by Westpac.
It’s our view that both the length of time that Ms Chandler performed her role remotely and the high standard of her work were key considerations in the FWC’s decision. The system-based administrative support used by Ms Chandler and Westpac in their day-to-day operations was also a key consideration.
What should employers do?
1. Consider, discuss, respond!
Employers must respond within 21 days of receiving a flexible working arrangement request. If an employer will not immediately accept the request, then all procedural steps must be completed within the 21-day period.
Employers can only refuse a request if they have followed all procedural steps under the Fair Work Act, including:
- consulting with the employee to try to reach a genuine agreement;
- considering the impact of a refusal on the employee’s circumstances; and
- providing tangible evidence to back up any refusals on reasonable business grounds.
To meet their consultation requirements, employers should:
- Meet with the employee to discuss their request;
- Proactively offer alternative arrangements for the employee’s consideration.
When considering the consequences of a refusal, employers must take into account both the personal and financial impacts on the employee.
Lastly, all procedural steps, considerations and alternative options raised by the employer must be included in the employer’s written response. If it’s not in writing, it didn’t happen!
2. Occupational Health and Safety
Employers in Victoria are required to take proactive steps to provide and maintain a safe and risk-free working environment for their employees’ physical and psychological health and safety.
Victoria’s new Occupational Health and Safety (Psychosocial Health) Regulations 2025, which came into effect on 1 December, further emphasise employer obligations in identifying and managing psychosocial hazards and risks in the workplace. These obligations need to be front of mind when considering an employee’s flexible working arrangement request.
Get in touch
If you have any questions or would like to discuss how you can best respond to an employee’s flexible working arrangement request, please contact us. We would love to help.
Our podcast, “We have this employee…” also has a 2-part episode on responding to flexible working arrangement requests, which you can listen to here (Part 1 and Part 2).
