entitlements to flexible working arrangements

Under s 65 of the Act, employees who have continuously completed 12 months of service may request a change in their working arrangements. These requests are to be made in light of various circumstances, such as pregnancy, parent or carer responsibilities or disabilities.

However, the Act also permits an employer to refuse a request, provided that certain requirements have been met. These requirements include whether the employer has made a genuine attempt to reach an agreement with the employee to accommodate their circumstances, whether the employer has regard to the consequences of their refusal of the FWA request on the employee, and where the refusal of the FWA request is on reasonable business grounds.

The term ‘reasonable business grounds’ includes circumstances which may justify the employer’s refusal:

• That the new working arrangements requested would be too costly for the employer;
• That there is no capacity to change the working arrangements of other employees to accommodate the new working arrangements requested;
• That it would be impractical to change the working arrangements of other employees, or recruit new employees to accommodate the new working arrangements requested;
• That the new working arrangements requested would be likely to result in a significant loss in efficiency or productivity;
• That the new working arrangements requested would be likely to have a significant negative impact on customer service.

recent decisions by the Commission

Kent Aoyama v FLSA Holdings Pty Ltd [2025] FWC 524

In this recent decision, Mr Aoyama made a formal request to his employer, FLSA Holdings, seeking flexible arrangements due to new, increased parenting responsibilities. Initially, Mr Aoyama informally agreed with his employer to work from home on Tuesdays and Thursdays. However, in his formal request, the employee sought to add an additional day each fortnight. His formal request was subsequently refused by his employer, on the basis that during his working hours, Mr Aoyama was expected to perform his contractual duties without distraction – including providing care for a young child. FLSA Holdings also raised several complaints they had received from clients regarding Mr Aoyama’s performance whilst working from home, such as ongoing baby noises whilst he took calls.

The Commission considered FLSA Holdings’ refusal of Mr Aoyama’s FWA request on the basis of reasonable business grounds. It determined the employer failed to provide compelling proof that there would be any material bearing on efficiency or productivity and ordered that FLSA Holdings accept Mr Aoyama’s request. Commissioner Sloan, in arbitrating the dispute, particularly found that:

• FLSA Holdings Arguments fixated on the fact that Mr Aoyama’s contract indicated he would usually work from the office ultimately failed to acknowledge the overriding purpose of s 65 in providing an avenue to effectively alter the employee’s contract;
• FLSA Holdings’ reliance on Mr Aoyama’s contractual obligation to devote his whole time and attention to FLSA while working was misguided and unrealistic;
• FLSA Holdings’ evidence about the impact the arrangement would have on the business was too limited – the Commissioner was only informed of vague comments allegedly made by a client and supplier about the child noises in the background;
• FLSA Holdings did not tailor its submissions to the nature of the change sought by Mr Aoyama, failing to address what he was requesting would be significantly different to what they were offering;