Worklife 2.0: Hybrid and remote working becomes the norm – what does this mean for employers?

Initially a temporary response to the Covid-19 pandemic, it now seems that hybrid and remote working arrangements have become a more permanent tool for organisations to attract and retain staff. This development in the world of work is generally enjoyed by employees, but what does it mean for employers? In this blog post, we explore some of the key challenges associated with hybrid and remote working and how employers can tackle them.

Employment contracts and flexible working requests

Many employees worked from home during the pandemic, despite contracts specifying the office or another workplace as the primary place of work. For businesses wishing to make hybrid and remote working more permanent, formalising this in employment contracts is a sensible step, although employers should be mindful that doing so will generally require employee consent. For businesses at the other end of the spectrum, an express contractual requirement requiring employees to work at a specified workplace is helpful, and employers should be able to rely on it to make a reasonable management instruction to request staff back in the office. However, the reasonableness of seeking to enforce this requirement will depend on various factors and could present challenges. Things may be particularly difficult where staff have moved further away from the workplace for lifestyle reasons and are refusing to return (at least on a full-time basis). Any flexible working requests made in these circumstances should be treated with care – where an employee has been able to perform their role successfully from home during multiple lockdowns, it may be difficult to substantiate a refusal on operational grounds. Going forwards, we may see this becoming an increasingly important due diligence point for buy-side HR teams on transactions.

Employment policies and employee incentivisation

Acas guidance encourages employers to create a policy for hybrid working or to update any existing policies to reflect the new world of work. Having a policy in place can help provide clarity around employers’ expectations and is also a good way to set (flexible) limits on hybrid and remote working arrangements, from days per week to prohibited workspaces. In addition, just as the pandemic led to changes in employees’ needs, the needs of organisations shifted too. Many employers adjusted existing policies and drafted new ones to address immediate Covid-19-related issues, but they might also want to look at updating other policies, such as those relating to whistleblowing, grievances, or disciplinary proceedings. Furthermore, employee incentivisation will be subject to scrutiny. Some businesses have considered reducing pay and benefits for remote workers, but employers should be mindful that doing so could open them up to legal risk, including in relation to discrimination and breach of contract.

Confidential information, data protection and employee monitoring

The nature of hybrid and remote working means that employees are more likely to work in areas such as their homes, cafes, and public libraries. This reduces the level of control that employers might otherwise have over confidential information and personal data. There is also the potential for weaker security protections, increasing the likelihood of cyber-attacks. In response to this, employers should carefully consider confidential information provisions in employment contracts, policies and privacy notices, and some might even go one step further by considering changes to their employee monitoring. If they do so, they should carry out an impact assessment, be transparent with employees, and ensure that employee privacy notices are refreshed. There is a fine balance to be struck, as rigorous monitoring can lead to employees feeling distrusted, which can in turn lead to stress and reduced productivity.

Management and culture

Changes may need to be made to management and supervision procedures. According to CIPD guidance, one way to ensure efficient management in a hybrid working environment is to focus on effective communication. As hybrid working naturally reduces ad hoc interactions, employers need to implement measures which allow for regular interactions between managers and employees. This will provide employees with more opportunities to raise concerns and allow them to feel part of the team. The guidance suggests that employers should also consider whether current performance management systems are fit for purpose in a remote environment and whether any systems need to be adapted. Regardless of the effectiveness of previous procedures and the experience of managers, hybrid and remote working arrangements present unique challenges which did not previously exist. As a result, organisations may need to provide targeted training to managers to equip them to deal with such challenges.

Health and safety

Employers have a duty of care under both common law and legislation to take reasonable steps to prevent foreseeable harm occurring to their employees, regardless of their location of work. This means that employers must conduct risk assessments of their employees' working environments and review them regularly to ensure that employees working from home remain safe and healthy. Mental health is also likely to feature in employers’ health and safety considerations. When implementing support across an organisation, employers should be mindful of treating all employees equally. This may involve ensuring that wellbeing support is made available online, for example. Doing so may help to reduce the risk of discrimination claims from hybrid and remote workers.

Diversity and inclusion 

Diversity and inclusion has been a crucial topic for HR professionals for quite some time, but it is easy to miss the connection with hybrid and remote working. It is critical that office attendance is not seen as a way to ‘get ahead’, so employers should consider the risk of favouring people in the workplace by providing them with more opportunities such as additional training and promotions. Doing so could result in a ‘two-tier workforce’ and ultimately risk indirect discrimination claims if the majority of hybrid and remote workers share particular protected characteristics. As a way to mitigate the risk of such discrimination, employers should implement transparent decision-making frameworks which explain how employees are given opportunities and support. Another way is to schedule meetings using technology which allows everyone to participate. CIPD guidance also recommends that employers should identify areas where inequalities may have developed during the pandemic and set out plans to address these to ensure that they do not have a long-term detrimental impact on individuals or the organisation. Any employer taking such a step should, however, be cautious about the paperwork that they create in the process and may wish to take legal advice before doing so.

Tax

Finally, employers should consider the tax implications arising from hybrid and remote working. While working from home is becoming the norm for many organisations, does ‘work from home’ mean ‘work from anywhere’? And if so, does it matter if this arrangement is temporary? What if the employer has no office at all in that jurisdiction? Employers and internationally mobile employees will want to consider the potential tax and social security implications of their arrangements. In addition, long-term working abroad may expose employers to a permanent establishment risk. The Office of Tax Simplification is conducting a review into the emerging trends and tax implications of hybrid and remote working, and the findings should be published early next year.

The changes to our working environment arrived quickly in 2020 and inevitably required a degree of ‘fire-fighting’. Over two years on, many of these changes have become the norm, but employers are still grappling with the legal and practical challenges that they create. In many cases, there is no ‘one way’ to approach these issues and business will need to be adaptable as the working landscape continues to evolve.