Covid-19 and today’s workplace: where next?

Friday 7 October 2022

Katie Kossian
Maddocks, Sydney, New South Wales

Bruce Heddle
Maddocks, Sydney, New South Wales

In March 2022, and in the context of discussions about returning to work following the emergence of Covid-19, Parag Agrawal, the Chief Executive Officer of Twitter, tweeted: ‘Wherever you feel most productive and creative is where you will work and that includes working from home full-time forever.’

A number of other large organisations have adopted a similar approach while others have been both critical and sceptical of ongoing remote work arrangements. A notable critic, Elon Musk, has been vocal about his desire to have his Tesla employees in the office for a minimum of 40 hours per week, and earlier in 2022, posted a poll for his Twitter followers asking whether Twitter’s San Francisco office should be repurposed into a homeless shelter because ‘no one shows up anyway’.

Putting these conflicting views aside, the divergent approaches tell us that the roadmap to ‘normal’ work reads more like a ‘choose your own adventure’ novel than a ‘how to’ manual. In fact, there are a spectrum of approaches which are dependent on the unique needs and requirements of each workplace including, for example, their size, geographic presence, the sector in which they operate and their preferences for how and where work is performed.

There is no doubt that Covid-19 has had a truly transformative and, potentially, lasting effect on the way organisations operate, and how their employees undertake work in particular. But what is also clear is that these changes have occurred within a legal framework which has remained largely unchanged, at least in Australia. So what does this mean for employers in Australia? What are the questions and considerations that employers need to think about in this Covid-present environment? This article briefly touches on some of the key considerations.

Does location matter?

If your organisation is able to manage work remotely, should you continue to allow your employees to work away from the office some of the time, all of the time or not at all? The answer is, of course, ‘it depends’.

Putting aside those industries where work cannot be completed remotely (and there are a number of them), a completely remote or hybrid work arrangement requires employers to meet their various legal obligations in circumstances where there is (or may be very limited) direct line of sight over employees. This means that employers need to consider, and implement effective systems and tools to meet their duty of care to employees, which extends not only to providing a safe place of work and safe systems of work, but also to responding adequately to incidents of bullying and sexual harassment, which can, and increasingly are, instigated through electronic means.

There are other practical problems for employers who employ employees covered by an award or enterprise agreement. These are documents which, in Australia, are made by an employment tribunal and set out minimum entitlements for the employees they cover. These documents typically set out minimum entitlements (including, for example, the provision of overtime and penalty rates) and prescriptive conditions of work, including what constitutes an employee’s ordinary hours of work, the span of hours during which those ‘ordinary hours’ can be worked and what increases in rates of pay are required when employees work outside of those hours. In circumstances where employees work remotely and, at their own initiative, seek to work outside the relevant ordinary hours (for example because they enjoy the flexibility of being able to attend to personal commitments during typical work hours), their employer may be exposed to a underpayment claim if the employee is not sufficiently compensated for their actual hours of work (even when, as a matter of practicality, they have set their own hours of work).

More broadly, employers need to consider appropriate processes to measure productivity, performance (including underperformance) and staff engagement and cohesion. There is no one-size-fits-all approach to these aspects of work, however, ensuring that there is clarity in practices and processes including, through training, which are supported by appropriate policies that have been well communicated and properly implemented is critical.

Being flexible with flexibility

‘Flexibility’ seems to be a watchword in recent times, and with good reason. Research of data collected by Australia’s Workplace Gender Equality Agency (WGEA) tells us that Covid-19 created widespread support for flexible work arrangements among employers and employees alike.

While the Fair Work Act 2009 (Cth) (FW Act) has, for a considerable number of years, given certain types of employees the ability to request flexible work arrangements, in reality many employers have introduced policies which expand the entitlements under the FW Act. For example, data from the WGEA about the uptake of flexible work arrangements due to Covid-19 suggests that that nearly four in five private sector organisations with 100 or more employees in Australia have a formal flexible work policy in place and that many of the organisations that do not have formal flexible work arrangements enter into informal flexibility arrangements with their employees.

There is little doubt that flexibility is often a ‘perk’ offered to engage and retain staff, but employers need to ensure that any policy around flexible work arrangements is applied fairly and consistently to all staff in circumstances where a failure to do so may result in disgruntled employees or turnover, and liability arising from claims of bullying and unlawful discrimination.

It is also important to consider requests for flexibility carefully, and where they are to be declined, to be able to demonstrate the valid business reasons for why that is the case. Whatever the outcome (whether approved, declined or provisionally approved for a trial period), the decision should be effectively communicated to the employee and documented, noting that in the context of the flexible work arrangements recognised in the FW Act, there are specific requirements (and timeframes) that must be met.

Doing ‘wellness’ well

Unfortunately, work through the Covid-19 pandemic has highlighted some pretty staggering statistics about the state of the mental health of many Australians. Last year, the Australian Bureau of Statistics (ABS) reported that between 2020 and 2021, 3.4m Australians sought medical treatment for mental health concerns. Additional ABS surveys found that 20 per cent of Australians experienced high, or very high levels of psychological distress in March 2021. Other research is indicating that Australians are facing record rates of burnout.

We also know, from reports such as Safe Work Australia’s Taking Action: A best practice framework for the management of psychological claims in the Australian workers’ compensation sector, that serious claims involving psychological injury (being those where an employee is absent from work for a week or more) result in more lost time and significantly higher cost than other types of workplace injuries. In short, workplace stress is bad for staff and bad for business. So, what can and should employers do?

As a starting point, employers need to think about ‘wellness’ from a work health and safety perspective, in circumstances where work health and safety legislation requires employers to provide employees with a safe work environment and safe systems of work. Safety is not limited to physical safety, but psychological safety too. Inherent in any assessment of the potential risks to safety is the concept of work design, that is, considering not only the work that is performed, but how it is performed and, relevantly for remote work arrangements, where it is performed. Employers need to identify comprehensively and manage psychosocial hazards,  being those risk factors which lead to workplace stress. Known psychosocial hazards include high demand and low demand jobs, low job clarity, poor support and work relationships, and low recognition and reward.

To do ‘wellness’ well, employers need to think about work design in a granular way to identify, assess and eliminate or, if that is not practical, control psychosocial hazards. For remote or hybrid work arrangements, there is a clear impost to investigate the safety of an employee’s remote work environment for potential risk of injury. However, any failure to do so has the potential to create liability for breach of work health and safety legislation and runs counter to an employer’s duty of care for its employees more generally.

Are you engaged?

During 2021, much was written about the ‘Great Resignation’, the notion that Covid-19 had caused many to re-evaluate their lives and motivations, and would leave their jobs to find something which made them feel more happy and fulfilled. While there is no clear consensus as to whether this phenomenon transpired in Australia, it is clear that it has been swiftly replaced by the concept of ‘Quiet Quitting’, the notion that while employees may not actually resign, they will not be prepared to go ‘above and beyond’ in performing the work they do for their employers as they might have done pre-Covid-19.

The latter concept, whether real or speculative, appears to focus the lens on employee engagement (or disengagement) and, in particular, two aspects of the employment relationship: work boundaries (including the scope of an employee’s role); and remuneration and reward (being recognition and compensation for an employee’s effort at work). Putting aside the need to consider employees' working conditions (and any apparent psychosocial hazards) for the reasons mentioned above, the discourse about staff retention and engagement is really an opportunity for employers to seek to understand from their employees what they enjoy about the work they do, and what they would like to change. In circumstances where many Australian businesses are experiencing a ‘war on talent’ and finding recruitment challenging, this type of engagement may be well worth having.

Key considerations

Review your organisation’s employment contracts and policies

If the way your employees undertake their work has changed, your employment contracts and policies should be reviewed to ensure they are fit for purpose. Consider not only the contractual terms, but also whether any applicable position description needs to be amended to reflect more accurately changes in how, where and when employees are expected to work. If you are an employer with employees covered by an award or enterprise agreement, take special care to ensure that your proposed systems of work are compliant with these documents.

Engage meaningfully with staff

A recent study conducted by McKinsey found that employees felt significant anxiety around their work arrangements post-pandemic. Where there is uncertainty, consultation and communication are key. This is particularly the case now where many organisations are faced with the challenge of being able to engage and retain staff. Take steps to understand what your employers want and value and what they perceive your organisation does well and what can be improved. A well-structured online and anonymous engagement survey may not be the panacea for all the challenges your organisation may face, but it’s likely to provide you with some useful insights that can be used to create positive changes.

Appropriate work design is the root of wellness at work

Initiatives such as virtual yoga and meditation and healthy readymade meals are wonderful additions to an employer’s ‘wellness’ arsenal, but they should be seen as supplementary to, and not a substitute for, comprehensive assessment of work design.

Review what you have done to guide what you will do

We have lived (and worked) through a lot of uncertainty, which at times has required both urgent and reactive action. It is important to consider whether your organisation's strategic focus in the management of employment issues is, and continues to be, fit for purpose through review. Not only is this commitment to continuous improvement good for business, it’s also a statutory requirement under work health and safety legislation.