November 1, 2021

The discussion of the contractual position set out above is of most direct relevance to the ‘place of work’ term in the contract. The importance of establishing the contractual place of work is illustrated by the employment tribunal’s decision in Peiris and anor v St Patrick’s International College Ltd and anor ET Case No.2200288/17. There, HP and his wife, RP, both worked for the College under contracts of employment that made clear that their place of work was at the College’s offices in London.

When RP became pregnant in May 2014, the couple intended to return to Sri Lanka to be with family for the birth and for the duration of RP’s maternity leave. The College gave permission for HP to work from Sri Lanka during this period. At the end of RP’s maternity leave in March 2015, the College wrote to both HP and RP, requesting that they return to work in London.

However, they failed to return as requested, stating that they had had problems getting a visa for their baby to enter the UK. They were eventually dismissed for failing to return as agreed, despite a number of management requests. The employment tribunal rejected their claims of unfair dismissal and failure to pay notice pay. In relation to notice pay, the tribunal noted that the claimants were contractually obliged to work in London and that their failure to return was therefore a breach of contract. The College was therefore entitled to dismiss summarily.

Note that employers are obliged to give workers a statement of their written particulars of employment under S.1 of the Employment Rights Act 1996. S.1(4)(h) requires the statement to include ‘either the place of work or, where the worker is required or permitted to work at various places, an indication of that and of the address of the employer’. If any of the particulars listed in S.1 change, the employer is required by S.4 ERA to give the worker a written statement of the change within a month. A change to homeworking or hybrid working would therefore be likely to trigger this obligation, regardless of whether it entails contractual changes.

Trial period

If the new working arrangement is to be put on a contractual basis, the employer may wish to consider including a provision enabling the arrangement to be brought to an end during or at the end of an unsuccessful trial period. This might be appropriate if the employer has concerns as to how the arrangement will work. The clause would require the employee to revert to conventional working at the end of the trial period. If the employer chooses to go down this route, the duration of the trial period and the measures used to identify success or failure should
be clearly set out in the contract and understood by the employee. The clause should also require the employer to give a minimum period of notice before requiring the employee to return to office-based working.

Right to enter

If the worker is to keep company equipment at home, the employer may wish to include a contractual right for it to enter the employee’s home forthe purpose of installing, inspecting, replacing, repairing, maintaining or servicing the equipment during the course of the employee’s employment. The right to enter might also cover carrying out health and safety risk assessments of the company’s equipment and the employee’s workstation and recovering the equipment on or after termination of employment. Such clauses commonly require the employer to exercise this right only at reasonable times and on reasonable notice.

Employees are likely to have concerns over providing employers with a contractual right to enter their homes and may consider it an infringement of Article 8 of the European Convention on Human Rights, under which everyone has the right to respect for their private and family life, their home and their correspondence. If employers face resistance when trying to agree a contractual right to enter, alternatives may include requesting permission to enter on a case-by-case basis when required, arranging for couriers to collect equipment in need of repair, and including contractual provisions permitting deductions from pay for unreturned equipment. Note that if the employee is not the owner or tenant of the home, a contractual right to enter will be of no effect and the employer will need to obtain the consent of the owner or tenant to enter the premises.

Termination

There are a number of circumstances in which an employer may wish to bring an employee’s homeworking or hybrid working arrangements to an end. For example:

  • Where the employer has reserved the right to ask the employee to revert to normal working practices at the end of any unsatisfactory trial period (see above)
  • where the arrangements have been a stopgap or temporary solution to a problem
  • where changes to the employer’s business or personnel make it impossible for the employer to organise work effectively with the employee working at home
  • where the employee’s role or responsibilities change so that working from home is no longer suitable.

If the homeworking or hybrid working arrangement is agreed by way of a contractual variation, the employer will want to make provision for these eventualities in the contract. The contract should therefore specify the circumstances in which the employer can terminate the arrangement and the notice that it must give. However, it should be noted that even if the employer has a contractual right to require the employee to revert to workplace-based working, the exercise of the right will be subject to the implied term of mutual trust and confidence.

To terminate an arrangement which has been working perfectly satisfactorily without good reason may be a breach of that implied term. Therefore, any change should only be implemented after consultation and on reasonable notice.

Expenses

In order to avoid disputes over what expenses are properly payable, the contract should specify the expenses that the employee can claim when working from home or direct the employee to a policy dealing with expenses which sets this out. Such expenses may include travel costs to attend the workplace, telephone, broadband, heating and lighting costs, and any increased insurance premiums.

The absence of a term covering expenses when homeworking could result inone being implied. In an unusual case, Newman v Arrow Promotional Ltd and anor ET Case No.3200081/17, an employment tribunal awarded N over £2,000 as a contribution towards his household bills where he had been required to work from home for two years. Although AP Ltd was a UK-based company, it did not have any offices, and was run from New York. All of its UK-based employees worked from home. They were all dismissed by Skype call from New York and N succeeded in his claims for unfair dismissal, arrears of pay and expenses, and a failure to consult under the Transfer of Undertakings (Protection of Employment) Regulations 2006 SI 2006/246.

When determining compensation, the tribunal found that AP Ltd clearly owed N something for the use of his home as a workplace. N apportioned his utility bills, including gas, servicing, water rates, broadband and landline, taking into account days worked and subtracting holidays. The tribunal noted that the high-speed broadband was installed specifically to enable more efficient homeworking, and that N had additional insurance costs because he had a company computer. It awarded expenses at a rate of £4.28 per working day.

Working time

Given that homeworking or hybrid working inevitably leads to a blurring of the boundary between work and home life, it is crucial to establish what is defined as working time and, in particular, when the employee will be available when working from home. The employer will have to consider whether employees are required to be completely flexible, whether they should observe strict working hours, or whether there will be ‘core hours’ when they must be available, plus flexibility to complete non time-critical tasks at other times. Commitments such as childcare or the care of other dependants are likely to affect the working hours that will be possible for different employees, and so the contract (and/or the relevant policy) should make clear what is expected of employees in this regard.

Employers should have mechanisms in place to ensure that staff working from home comply with the limits on working time and should keep adequate records. Failure to take reasonable steps to comply with the limits on working time or the record-keeping requirements will render the employer guilty of a criminal offence under Reg 29 of the Working Time Regulations 1998 SI 1998/1833 (although we are not aware of any prosecution under these provisions). Since employers cannot realistically supervise whether homeworkers take their breaks, the contract or policy should make it clear that those working from home are responsible for regulating their own working time and taking breaks as appropriate.

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