Employee rights and employer responsibility for work-from-home arrangements
While lockdowns, face masks, and social distancing may now feel like distant memories, one aspect of the COVID-19 pandemic has endured: working from home.
Many employees have become accustomed to the comfort and convenience of working remotely, and some now consider it a right. With employers adopting a variety of approaches to work arrangements, disputes over flexible and remote working have become increasingly common.
So, what rights do employees actually have when it comes to working from home, and what steps should employers take to minimise risk and avoid legal claims?
What does the employment agreement say?
The starting point is always the employment agreement.
It is a legal requirement for an employment agreement to specify the employee’s place of work. Typically, this will be the employer’s premises, with the employer often retaining some discretion to change the work location within reason or to require travel as necessary for the role.
Occasionally, an employment agreement may expressly allow an employee to work from home — either in part or in full. In such cases, the employee has a contractual right to work remotely, which can only be amended by mutual agreement. If the agreement is silent, then the employee’s right to work from home will be dependent on other arrangements and factors.
What about workplace policies?
Many employers have written policies covering working from home arrangements. These policies may set expectations around flexible working, including the extent to which remote work is permitted, how employees should communicate while working from home, and whether there are “anchor days” when employees are expected to be in the office.
Where a policy allows employees to work from home, employers should always comply with it. Failure to do so may give employees grounds for a legal claim.
Employers generally have the right to change workplace policies, including those relating to flexible working, without necessarily seeking employee agreement. However, if an employer is considering changes that would reduce employees’ ability to work from home, it is advisable to consult with staff before finalising any changes. This approach helps minimise the risk of a personal grievance claim. If there are additional procedural requirements — such as consultation obligations under a collective agreement — these must always be followed.
Requests for flexible working arrangements
If an employee’s agreement does not provide a right to work from home, and there is no policy allowing remote work, employees still have the right under the Employment Relations Act 2000 to request flexible working arrangements at any time. This includes seeking changes to their days, hours, or place of work.
When such a request is made, the employer must respond within one month, confirming whether the request is approved or declined. An employer may only refuse a request if it cannot be accommodated for one or more of the following reasons:
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Inability to reorganise work among existing staff
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Inability to recruit additional staff
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Detrimental impact on quality
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Detrimental impact on performance
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Insufficient work during the periods the employee proposes to work
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Planned structural changes
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Burden of additional costs
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Detrimental effect on the ability to meet customer demand
Employers should note that employees often make requests for remote or flexible working without formally framing them as such. Although this may not technically trigger the flexible working provisions of the Employment Relations Act, we still recommend that employers consider these requests in line with the Act’s provisions, and ensure any decision to decline is consistent with the grounds outlined above.
How to change informal working-from-home arrangements
Ideally, working-from-home arrangements are clearly documented in the employment agreement, workplace policies, or a written agreement between the employee and employer. In reality, many remote working arrangements are informal holdovers from the pandemic or have arisen without a clear agreement. These situations can be challenging for both employers and employees to manage.
A recent decision from the Employment Relations Authority, Petrie v. Alphero Limited, provides a good example of how to correctly manage an informal work-from-home arrangement. In this case, an employee claimed they were unjustifiably disadvantaged when their employer declined their request to work from home full-time and required them to return to the office for three days a week. The employee had been working from home four days a week for over a year prior to the request.
The Authority found that the employee was not disadvantaged. In reaching its decision, it placed weight on the fact that the work-from-home arrangement had been clearly communicated as temporary and dependent on the employee working on a particular project. The employer had emphasised to staff that flexible working arrangements would be reviewed if they no longer suited the business or its clients.
This decision highlights the importance for employers who allow informal work-from-home arrangements to clearly communicate that these are temporary and may be changed at any time. Ideally, this should also be documented in a written policy.
Employer obligations when employees work from home
When employees work from home, their home is considered a workplace. As such, employers’ health and safety obligations remain in place.
Carrying out a risk assessment and discussing arrangements with employees can help employers identify health and safety risks at home, and ensure they are meeting their health and safety obligations. These risks may include injuries from poor workstation setups, fatigue, burnout, and mental health concerns such as isolation.
Where health and safety risks are identified, employers must take reasonable steps to address them. This could include providing appropriate equipment (such as screens or desk chairs) to enable safe and effective remote work, ensuring a robust health and safety policy is in place, and offering training to employees on safe work practices at home.
What about working from overseas?
With the increase in remote working, it has become more common for New Zealand employers to allow employees to work remotely from overseas, either part time or full time.
In these situations, it is crucial for employers to be aware of potential tax implications and whether labour laws in the overseas jurisdiction may apply. Even if an employee only travels abroad periodically, enough time spent overseas could trigger unintended legal consequences.
It is especially important that such remote working arrangements are set out in writing to clarify obligations. For example, if employment-related tax is payable in the overseas country, it should be clear whether the employee or employer is responsible. Where the overseas country has different minimum employment entitlements, it should be clarified which entitlements the employee will receive.
If the intention is for the employee to remain employed under New Zealand law, the employment agreement or any variation documents relating to the overseas work should be explicit about this. However, that will always be subject to a range of factors, including the laws of the country where the employee is working and is something that will likely require specialist advice.
Alastair Espie is a Partner at Duncan Cotterill in Auckland, specialising in employment and industrial relations. Nicole Meech is a Solicitor at Duncan Cotterill in Auckland.
