Working from home permanently: the employment law options

Since the COVID-19 outbreak, many employees have been temporarily working remotely. With news that Government guidance is changing to “work from home if you can”, employers may be considering whether they can close their office permanently, save on rent and have all their employees working from home.

You’ll first need to make sure that your employees will consent to work from home on a permanent basis. It may be easier to seek agreement if they are already working from home temporarily because of COVID-19. Anecdotally, it seems that many middle-aged employees who are established in their careers may be keener on home working than younger colleagues.

Assuming it makes commercial sense, you will then need to consider the legal practicalities.

Place of work

Section 1 of the Employment Rights Act 1996 (ERA 1996) requires an employer to give employees a written statement of particulars of employment – a section 1 statement. Normally this will be in the form of a contract of employment. The statutory terms include the place of work. If any terms change, an employer is required under section 4 of the ERA 1996 to issue a written statement of any changes – a section 4 statement.

The first thing you should do is check your employees’ contracts of employment to identify the place of work. In most cases, it will be your office address.

Mobility clause

You may also have a mobility clause in your employees’ contracts of employment that enables you to determine where the employee can work from. If there is a mobility clause, you may be able to rely on that clause to require the employee to work from home.

Redundancy

If there is no mobility clause and you wish to require employees to work from home permanently, it is likely to be a redundancy situation. This is because the relevant statutory definition of redundancy refers to the fact that the requirements of the business to carry out work at the place where the employee is employed have “ceased or diminished”.

If your employees refuse to consent to work from home, you may need to consider going through a redundancy process. As part of the consultation process, you should offer the employee a role based at their home address.

Tactically, consider whether a redundancy process is really the best option for you. It may mean you end up losing key staff and are then unable to serve your clients’ needs.

Redundancy can also be costly, since you will be required to pay notice and a statutory redundancy payment. Unless your contracts of employment specify higher notice periods, broadly speaking you are required to give one week’s notice for each year of service up to a maximum of 12 weeks.

ACAS Guidance

ACAS have published guidance on working from home, reminding employers and employees to be “practical, flexible and sensitive to each other’s situation when working from home because of the coronavirus (COVID-19) pandemic.” They suggest practical steps, including that employers should:

talk to their employees and workers about how they might improve working from home arrangements
support employees to adjust to remote working
set clear expectations
consider individual employees’ needs, for example anyone with childcare responsibilities, a long-term health condition or a disability
keep in touch regularly
write down the arrangements that have been agreed so everyone’s clear

Checklist

If your employees are likely to consent to the move or you can invoke a mobility clause, there are still several issues to consider, including:

1. Your data protection obligations under GDPR and your obligation to take measures to prevent accidental loss of data.

2. Whether employees may feel isolated if they work from home permanently and whether it could affect their mental health.

3. Carry out a health and safety assessment. The HSE has published guidance on protecting home workers.

In particular, it states that when someone is working from home, you should consider:

how you will keep in touch with them
the work they will be doing (and for how long)
whether it can be done safely
whether control measures will be needed to protect them

4. Consider if any special equipment is needed for employees to carry out their work from home. If any employees have disabilities, you may need to consider reasonable adjustments.

5. Check your business insurance to make sure any of your equipment is covered at the employee’s home. Considering asking your employees to check that there is nothing in their mortgage or home insurance that prevents them from working from home.

6. Take advice from your accountant regarding any employment tax implications.

7. Amend employees’ contracts of employment or issue a section 4 statement to reflect the new place of work.

If you plan carefully, you should be able to move staff reasonably easily. If it works, hopefully you will end up with a more profitable business with more motivated staff.

22 September 2020

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