Homeworking and hybrid working: the legal aspects

There’s plenty of content out there dealing with the approach employers can take to home or hybrid working. But what does home or hybrid working mean for contracts and policies? Both will need tailoring – here we consider some of the key points to keep in mind.

Services
Employers, Employment
Type
Updates
  1. Over-arching approach to home and hybrid working requests
  2. Changing contracts of employment
  3. Place of work
  4. Hours
  5. Salary and benefits
  6. Expenses
  7. Confidentiality
  8. Intellectual property
  9. Equipment and communications systems
  10. Special equipment
  11. Trial periods and right to revert
  12. Right to enter
  13. Reporting and appraisals
  14. Health and safety
  15. Illness
  16. Discipline and grievances
  17. Data protection
  18. Tax
  19. Tax and computers
  20. Insurance
  21. Planning

Over-arching approach to home and hybrid working requests

  • Consider the overall approach to ensure that requests are treated in a consistent manner. Looking at each request in isolation could cause problems and so is best avoided.
  • Consider the practical considerations of agreeing. For instance, if hybrid working is allowed, will members of a team have the flexibility to choose which days are worked from home or will there be specific days that the entire team must be in the workplace?
  • In a workplace containing multiple teams, how will the logistics be managed to ensure there is sufficient desk space on the days when several teams are working from the workplace? And how will different teams keep connected?
  • Note home or hybrid working which starts on a non-contractual and discretionary basis could, depending on its nature and duration, become an implied term of the contract.
  • While there is no automatic right to work from home or from another remote working location, employment law provides various protections, including the right to request flexible working, indirect discrimination, indirect sex discrimination, disability and age discrimination, and the rules on part-time working. All will need to be kept very clearly in mind.

Changing contracts of employment

A change from workplace-based working to home or hybrid working will likely require a change to the contract. The rest of this note looks at the various component parts which will require consideration.

If the change has been instigated by the employee, they will likely consent to a variation. However, if the change is to be imposed, employees may be less willing to consent.

Flexibility clauses are unlikely to assist, and employers should consider their options in advance if they want to make changes to ways of working.

Place of work

The employee’s place of work or, where the employee is required or permitted to work at various places (including their home), must be set out, together with an indication of that and the address of the employer.

It would also be sensible to include a requirement to attend the workplace from time to time, for example, for meetings, training, and team building. Linked to this might be a requirement to live within a commutable distance of the workplace.

Hours

Establishing when the employee will be available when working from home is a must. Will there be complete flexibility, strict working hours, or “core” hours? Can the employee be required to work outside these hours? Commitments such as childcare or other dependants are likely to impact on this and will need to be addressed.

Employees cannot opt out of rest breaks and employers should ensure that home or hybrid workers comply with the limits on working time and that adequate records are kept. No one will oversee whether such worker take their breaks, so the contract or a policy should make it clear they are responsible for regulating their own working time and taking breaks.

It is also important to have a clear distinction between working time and personal time at home – employee well-being depends on it. The longer-term nature of these agreements increases the importance of getting this right.

Salary and benefits

If the salary and benefits provided to those working from home are less favourable than those provided to comparable workplace-based employees discrimination claims could arise and any differences would have to be objectively justified.

Depending on where the employee lives, employers may consider that a location-related salary band (for instance, London weighting to take into account increased cost of living) is no longer appropriate for an employee who moves from being workplace-based to home-based. Changes to an employee’s salary, will amount to a contractual change and must be agreed. However, it may be something the employee is willing to consent to in exchange for homeworking. Consider though the discrimination risks if employees are required to take pay cuts as a condition of home or hybrid working.

Expenses

Such expenses may include travel expenses to attend the workplace, telephone, broadband, heating and lighting costs, and any increased insurance premiums.

There is no legal obligation to reimburse expenses incurred by an employee working from home. Employers may contribute a specific sum towards the homeworker’s expenses or reimburse actual reasonable expenses incurred. Alternatively, employers may decide not to provide a contribution or make any reimbursement. Consider the approach and whether amendments are required to existing expenses policies (or whether a new policy should be introduced).

Confidentiality

Confidentiality is more difficult to police when an employee is working from home, and even more so if the employee can work from remote locations that the public has access to. Carefully consider therefore where staff are permitted to work from and ensure this is reflected in the employment contract and any associated policy.

Additionally, those working from home or other remote locations should be required to keep confidential information secure. Include precautions for keeping confidential information secure, such as forbidding access by household members, passwords and encryption, secure storage, and shredders.

An express obligation to return confidential information on termination should also be agreed.

Intellectual property

Where employees work from home, employers will have less physical control over the work output and will therefore need to carefully consider the measures in place to protect IP.

Equipment and communications systems

Consider what equipment will be required by a home or hybrid worker, who will provide and pay for it, and who can have access to it.

If an employer supplies computer equipment, it will need to consider the systems in place for policing its use. The employer will also need to satisfy itself that the risk of a data security breach is low and that appropriate data privacy impact assessments are carried out.

Employee monitoring may require a different approach and employers should discuss any changes with employees.

Employers should also consider whether policies capture the issues that typically affect homeworkers. For example, providing guidance to employees on the appropriate use of social media and their obligations to protect the employer’s reputation.

These issues can be addressed by ensuring policies to make fit for home or hybrid workers.

Special equipment

There is no legal obligation to provide the equipment necessary for home or hybrid working, though one may arise if such working is at the employer’s request. However, ensure compliance with all duties owed to individuals. For example, if a homeworker has a disability, the provision of equipment may be required as a reasonable adjustment.  Such equipment may need to be available both at home and in the workplace.

Trial periods and right to revert

Consider whether it is sensible to have a trial period and a right to require the employee to revert to conventional working at the end of that trial. If there is to be a trial, the duration and the measures used to identify success or failure should be clearly set out in the contract. 

Remember exercising a contractual right to revert will be subject to the implied term of mutual trust and confidence and discrimination rules will apply. So good reasons to revert will be required.

Right to enter

Reserve a right to enter the employee’s home, for example, to carry out risk assessments or install, maintain and service equipment. Plus recovering property on termination.

Reporting and appraisals

Home and hybrid workers should be appraised like any other workers. They might worry that managers and colleagues think they work less effectively, so consider how to measure the quality and quantity of such. A suitable reporting and appraisal system should be agreed, building in sufficient opportunity for formal and informal reviews of work, projects, performance, expectations, and any difficulties which arise.

Home and hybrid workers should not be denied promotional opportunities open to comparable workers merely because they work at home all or part of the time. All decisions on this must be capable of objective justification.

Health and safety

There is likely to be increased scrutiny of compliance with health and safety obligations as home or hybrid working models become more prevalent and long term. So, revisit all health and safety risk assessments and act on them.

Also review existing polices and consider whether amendments are needed to reflect changed working practices.

Illness

Home and hybrid workers will have the same entitlement to sick pay as other employees but reporting mechanisms may need to be different. Interestingly, sick leave among home workers over the past 12 months have fallen. There could be various of reasons for this, and employers should monitor it and formulate their approach to when an employee should be “off sick” and not “working while sick”.

Discipline and grievances

Disciplinary and grievance rules can be amended to set expectations around using work time (from home) for domestic, family, or other commitments – such as chores, running another business and childcare. Alternatively, consider whether rules setting out expectations for those working from home would be helpful.

Data protection

Significant data protection implications arise with home or hybrid working. Employers will need to take technical and organisational measures (including training) to protect against unauthorised or unlawful processing of data and data breaches.

Tax

A home or hybrid employee may be entitled to claim a deduction against taxable income for certain household expenses and travel costs.

For a household expense to be tax deductible, the expense must be incurred wholly, exclusively and necessarily in the performance of the duties. There are HMRC Guidelines on this which are applied restrictively.

The fact that an employee does some work at home because there is no time to complete it during the working day or because the employer’s premises are too far away, is not sufficient. Similarly, relief is not available where an employee simply chooses to work from home some of the time.

If an employee can satisfy the tests various deductions can be claimed.

Payments to reimburse reasonable additional household expenses incurred while working at home under homeworking arrangements have been exempt since 6 April 2003. The exemption only applies where the employee works at home regularly by agreement with the employer, instead of working on the employer’s premises. It does not apply if the employee simply takes work home from time to time. The payments are intended to meet reasonable additional household expenses; as a general guideline, HMRC will approve a payment of £6 a week to an employee working at home, without supporting evidence of the cost, but a greater amount can be approved if there is evidence to justify it.

Tax and computers

If a computer is provided to an employee to use at home in the course of their employment, no income tax charge will arise provided any private use is insignificant.

To ensure a tax charge does not arise, consider prohibiting the use of the computer equipment for non-business purposes or require it to be kept to a level which is “insignificant”.

Insurance

Any equipment provided by the employer will need to be covered by insurance if possible.

Planning

Working from home will not normally require planning permission, provided no structural alterations are required and any business use remains ancillary to the use of the house as a home. However, if there are structural changes, or if the house is used for wider business purposes (such as meetings) planning permission may be required. There would generally be no obligation on the employer to fund this.


Please feel welcome to contact Paul Seath with any queries you may have around hybrid or home working.

Download our Homeworking and hybrid working interactive map.


This information is necessarily of a general nature and doesn’t constitute legal advice. This is not a substitute for formal legal advice, given in the context of full information under an engagement with Bates Wells.

All content on this page is correct as of June 15, 2021.