The workplace landscape is continuing to evolve. As business and operational requirements change, many employers are reassessing flexible and hybrid working arrangements and requiring employees to spend more time in the office. This shift has led to an increase in workplace disputes, with recent decisions of the Fair Work Commission (FWC) providing useful guidance for employers seeking to navigate these changing expectations.
We recently reported on the case of Karlene Chandler v Westpac Banking Corporation [2025] FWC 3115 (Westpac case). In that matter, Ms Chandler made a request to continue working remotely in order to meet her caring responsibilities. Westpac refused the request.
The FWC ultimately found in favour of Ms Chandler and ordered that Westpac allow her to continue working remotely. A key factor in the decision was Westpac’s failure to provide genuine and reasonable business grounds for refusing the flexible work request.
The Westpac case highlighted the potential consequences for employers who fail to deal with flexibility requests in accordance with the Fair Work Act 2009 (Cth).
More recent developments, however, demonstrate that employers may lawfully change flexible working arrangements where appropriate processes are followed.
Changes to Flexible Work Policy – Direction from employer to return to work
The recent decision in Mr Richard Johnson v PaperCut Software Pty Ltd [2026] FWC 178 (PaperCut case) illustrates that employers can successfully implement changes to flexible work policies where they undertake a reasonable and meaningful consultation process.
The relevant facts are as follows:
- PaperCut Software Pty Ltd decided to amend its Flexible Work Policy following the pandemic, requiring employees to attend the office three days per week. The proposed change was driven by revised business needs.
- The employer communicated its intention to change the policy, engaged in meaningful consultation with employees, implemented a staged return-to-office period, and confirmed a clear commencement date for the new arrangements.
- After the policy took effect, employees were directed to work from the office three days per week.
- Mr Johnson, who had been working from home five days per week, refused to comply with the direction and claimed that it breached his employment contract. He treated the flexible working arrangement as a contractual entitlement and disregarded the amended policy.
- Mr Johnson subsequently lodged an unfair dismissal application, alleging that his dismissal arose from the employer’s breach of contract.
The FWC found that the employer’s direction was reasonable in the circumstances and dismissed the employee’s unfair dismissal application.
Key distinctions between the Westpac and PaperCut cases
There are important differences between the two decisions:
- In the Westpac case, the employee made a formal request for flexible work arrangements based on her caring responsibilities. Westpac refused the request without providing genuine reasons. The FWC therefore found in favour of the employee and ordered that the request be granted.
- In contrast, PaperCut involved a change to an existing Flexible Work Policy implemented after meaningful consultation. The employee did not make a request for flexible work arrangements, nor did he provide any grounds for such a request.
Key takeaways for employers
- Employment contracts should include clear provisions requiring employees to comply with reasonable and lawful directions.
- Where hybrid or flexible working arrangements exist, employers should have a well-defined policy clearly setting out the terms and conditions of those arrangements.
- Employers may amend policies to reflect business or operational requirements, even where those changes are less favourable to employees than previous arrangements.
- Any changes to existing policies must be preceded by a meaningful and reasonable consultation process that is applied consistently.
- Requests for flexible work arrangements must be assessed in accordance with the Fair Work Act 2009 (Cth). Where a request is refused, employers must provide genuine reasons based on business or operational grounds.
For questions about your workplace obligations or policy requirements, contact the Workplace Relations Team:
📞 (02) 6175 5900
📧 workplace@mba.org.au
