The return to the office is a sensitive HR area, with employees often reluctant to abandon post-pandemic working arrangements and concede to the majority of their working week in the office. However, with reports that law firm Slaughter & May and accountancy firm EY have been monitoring employees’ office attendance to ensure policy compliance, it seems that employers are gearing up for a crackdown on office attendance.
This article analyses a recent Employment Tribunal case involving an FCA employee’s flexible working request for permanent home working. It also considers key employment law and data privacy implications of enforcing and monitoring office attendance policies.
Wilson v the Financial Conduct Authority – the facts
The claimant was a senior manager at the FCA with an employment contract stating that her normal place of work would be at a physical office location. In early 2020, in response to health concerns relating to the Covid pandemic, the FCA agreed that Ms Wilson could work from home. Following the pandemic, the FCA introduced a hybrid working policy requiring employees to work from the office 40% of the time and senior leaders to do so 50% of the time.
In turn, Ms Wilson submitted a formal flexible working request (pursuant to the flexible working regime under section 80F of the Employment Rights Act 1996) to allow her to work remotely on a permanent basis.
The claimant’s manager acknowledged that she had performed well remotely but considered that the FCA already had a generous homeworking policy in place and that approving the request would have a detrimental impact on the claimant’s performance or quality of her output. This is one of the eight statutory grounds on which an employer can reject a flexible working request. The claimant’s request was ultimately rejected.
The claimant’s arguments
Ms Wilson argued that the FCA’s rejection of her request due to performance/output concerns was based on incorrect facts because:
- She had received positive performance reviews and had been featured in workplace awards whilst working remotely.
- There was no empirical evidence that face-to-face working is better than remote working.
- There was no need for teams to be located in the same place, and there had been a move towards location-agnostic recruitment, with some team members based in Edinburgh.
- There was little likelihood of the claimant’s office-based days coinciding with other staff.
- The FCA had excellent technology which allowed the claimant to do her job remotely, with the option of virtually attending management meetings.
- There was a lack of meeting space at the office for private conversations, whilst calls made remotely from home facilitated sensitive conversations.
- The claimant was not required to attend workshop events, and if she was, she could successfully input remotely.
The decision
The Employment Tribunal held that the FCA had taken too long to respond to the claimant’s flexible working request (exceeding the statutory three-month deadline by a few weeks). One week’s pay was awarded as compensation.
However, the employment tribunal held in the FCA’s favour on the question of whether it was entitled to reject Ms Wilson’s flexible working request. In particular:
- The claimant’s manager had given detailed consideration and carried out a qualitative assessment of the flexible working request. The FCA had the claimant’s performance in mind when determining the application and did genuinely consider the merits of the request rather than blindly enforcing company policy (which distinguished this case from previous decisions).
- The claimant’s senior management position (with a team of 14) and corresponding training and supervision responsibilities were an important factor and influenced the test of impact on performance and quality.
- Remote working limits the ability to observe and respond to non-verbal communications, which are an important part of working with others, especially for senior individuals.
- While the claimant’s role could no doubt be completed successfully via remote working, there are identifiable weaknesses with remote working. Technology is not well-suited to the fast-paced interplay of exchanges which occur in face-to face meetings when rapid discussion can occur.
- The FCA had identified various factors leading to detriment in the quality and performance of the claimant’s work. Various elements of the role envisaged in-person participation, such as attendance at conferences, internal and planning meetings, and ad hoc training advice and support. The effectiveness of the claimant’s input would clearly be detrimentally impacted by attending remotely.
The judge held that the decision to refuse the claimant’s remote working request was not based on incorrect facts, and that remote working would indeed detrimentally impact her performance and the quality of her work.
Lessons for employers
Employers may well breathe a sigh of relief considering the FCA employment tribunal decision, particularly as flexible working cases often fall on the side of the employee. It recognises that employers are best placed to decide the working practices that support their business, taking account of the requirements of the industry, the nature of roles (particularly management roles) and individual performance expectations.
The decision certainly comes at an interesting time given the growing evidence of monitoring employees compliance with office attendance requirements. EY is reported to be using swipe card entry data to check staff are attending on the required number of days. With around half of some departments failing to attend on the required two days per week, it is not hard to understand why a more robust approach is being taken. With the trend changing towards increased attendance, It is likely that other employers will follow suit.
We set out below some key considerations for employers looking to adopt a similar approach:
- Enforcing an office attendance policy
Despite the introduction of discretionary hybrid working policies, many employers’ standard contracts will still stipulate that employees are required to work from the office on a full-time basis. Where this is the case, employees do not have a contractual right to work remotely and employers should be able to amend or even withdraw a general discretionary working policy in a straightforward way, subject to the benefits of early communication and consultation and individual flexible working requests.
Expecting an employee to comply with their contract and any minimum office attendance requirements would be a lawful employer instruction. Failure to comply would in turn justify the employer in starting a disciplinary process and imposing a disciplinary sanction (ranging from a warning to dismissal as a last resort).
Bank of America have recently taken this approach, notifying hybrid working staff that they will be subjected to discplinary action if they fall short of minimum office requirements.
- Legal risks to employers
Contracts cannot be varied unilaterally, and employers should be wary of attempting to vary contractual terms without the employee’s prior agreement. If a blanket approach is taken in response to concerns with individual employees (over performance, for example), there is an increased risk of wider employee grievances and constructive dismissal claims. Similarly, disciplinary action resulting in dismissal for non-compliance with existing policies could also result in costly unfair dismissal claims.
The FCA tribunal case also highlights the ability of employees to submit a formal flexible working request if the employers’ general policy fails to meet their needs. While these often focus on start and finish times and changes to working days, requests to work from home more often (or permanently) are increasingly common.
With effect from 6 April 2024, employees can submit a request from day one of employment (rather than after 26 qualifying weeks) and can submit two requests within a 12 month period. Employers will need to consult with an employee before rejecting their request, but there will be no change to the eight statutory grounds on which an employer can rely to reject a request.
A key risk with rejecting a flexible working request and in general with a policy requiring increased office attendance is discrimination claims pursuant to the Equality Act 2010. Unless employers adopt a consistent approach across the workforce, employees with protected characteristics such as sex and disability may try to argue that they have subjected to direct discrimination i.e. treated less favourably than comparable employees.
Further, a policy requiring minimum office attendance would be considered a “provision, criterion or practice (PCP)” for the purposes of an indirect discrimination claim. If an employee can demonstrate it puts them at a particular disadvantage because of their protected characteristic, the employer would need to objectively justify the policy in order to defend their position. For example, female employees with caring responsibilities (for relatives or children) are more likely to request a flexible working pattern. The FCA case demonstrates the importance of employers considering such a request carefully and fully documenting the objective reasons behind their decision. If the decision is subsequently challenged, the employer would be in a stronger position to defend any claim.
- Monitoring employees and data privacy
Employers who choose to enforce their office attendance policies by monitoring staff access to the building must take account of their data protection obligations under UK GDPR. A failure to do so entails the risk of complaints to the Information Commissioner, who has the power to impose significant fines.
There are numerous considerations in this regard, including:
- The need to comply with the overarching principles of UK GDPR. For example, the purpose limitation principle means that attendance data that has already been collated, for example for health and safety purposes, cannot simply be repurposed by an employer.
- Transparency is of the utmost importance. Employers should clearly inform employees of the intention to monitor building access data before they start doing so. As well as the fact of monitoring, employees should be told the reason why and what they will be doing with this data. This information should be contained in data privacy notices, data protection statements or staff handbooks, which should be easily accessible to employees. This also avoids the negative publicity and employee relations damage that may arise if any such monitoring is done in a covert way.
- Employers must establish a lawful basis for collecting such employee data under UK GDPR and ensure that its use will be proportionate to the purpose for which it is being collected. Employers should consider and document the legitimate business interests relevant to their business which they consider justifies the employee monitoring (essentially a “legitimate interest assessment”). An example might be maintaining client service levels and productivity through enforcing contractual attendance in the office.
- A proportionate approach would also involve limiting access to attendance data to those who need to know. This might include senior management and HR teams for the purposes of making overarching business decisions, whereas department heads are only likely to need access to the data relating to their team members.
- A Data Protection Impact Assessment should also be carried out where there is a risk to an employee’s rights or interests. This would be the case where the data could indicate breach of an employment contract or policy, resulting in potential dismissal.
Our recent Fox Williams article on the ICO’s new guidance for workplace monitoring offers further guidance in this regard. The ICO’s standards can be found here.
Conclusions
It is often the case that workplace trends reflect the state of the wider economy. In a buoyant job market employees can call the shots and move easily to an employer that offers the most attractive working pattern.
However, with daily reports of employee redundancies across a variety of sectors the tide may be turning in employers’ favour and it is no surprise that the spotlight is on employee productivity and performance. If employers conclude that this can best be achieved in the office rather than at home, many employees may take the view that it is safer to toe the line than risk appearing on a proposed redundancy list. The FCA decision offers useful employment tribunal guidance as to when an employer may be justified in standing behind its decision to refuse a home-working request.
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