On 16 October 2018 the Minister for Implementation officially opened a new inter-departmental government hub in Canary Wharf. This followed the government's announcement that it would look to move more than 6,000 civil servants to Canary Wharf to save money and reduce Whitehall office buildings. HMRC's agency estates director has recently confirmed that more than 2,000 HMRC staff are already benefiting from the hub's "modern flexible workspaces, great IT and excellent transport links". It is estimated that £20 billion of savings may be achieved in reduced running costs over 20 years. A further 14 regional hubs have already been announced. 

So what could private sector employers learn from the government's focus on smart working? 

Day-to-day employee occupancy may be reduced by allowing some homeworking, or flexible working. This may enable employers to increase staff numbers or the concentration of employees, without overcrowding. Employers may also introduce shared spaces for collaboration, and quiet areas for work requiring an intense focus. Spaces may also be shared with partner or mutually interested organisations to promote collaborative working.

Businesses should consider:

1. There may be ways in which their existing workplace could work better for it and its employees. Potential benefits may include: 

• a greater pool of potential employees (based in a broader range of locations) from which to recruit;
• reduced travel and real estate expenses and liabilities for the employer;
• a positive impact on the employer's health and safety record; and
• improved environmental performance and reduced fuel costs.

2. If a relocation is on the horizon, this can be sold as a positive change. Potential benefits may include:

• opportunities to forge stronger links with clients and the communities that employees support - employees may feel more connected and engaged;
• diversification of the workforce;
• more cash to invest elsewhere; and
• an improvement to work life balance, assisting in recruitment and retention.

3. Cultural changes may make a drastic difference to output and engagement without being particularly costly. Potential benefits may include:

• time back that could, if used effectively, improve output; and
• the ability to interact with and feel connected to colleagues in more distant locations.

Comment

Employers should sensibly consider all the implications of any potential move to smart working, and invest some time in planning before making any changes to working practices. In particular, employers should think about the need to draft, or update, company policies on homeworking, lone working, confidentiality and information security to ensure that their valuable information is not compromised by any such change. Employers should also make sure that employees are aware of the company's data protection requirements. If employers decide to enter into space-sharing arrangements with third party organisations, they may need to draw up commercial agreements with those parties to ensure that their valuable and private information is adequately protected.

Any office relocation may result in the need to change employees' terms and conditions. Employers should check if they have the benefit of any flexibility in affected employees' contracts of employment (mobility clause), to change the affected employees' normal place(s) of work, or whether this could amount to a redundancy situation. Such clauses may, if properly drafted and relevant in all the circumstances, avoid the need for the employer to go through a formal consultation with the affected employee(s) to change their contractual place of work. Advice should be taken before relying on such mobility clauses. Employers should be mindful that such clauses will be interpreted narrowly by the courts and tribunals and any ambiguity will be decided in favour of the employee. Notwithstanding this, the courts and tribunals do not go as far as to restrict employers to only make these changes "reasonably" or for "genuine operational reasons". Instead, employees are expected by the courts or tribunals to move their place of work, provided the new workplace is still within reasonable travelling distance of their home (Jones v. Associated Tunnelling Co Ltd [1981] IRLR 477 and Courtaulds Northern Spinning Ltd v. Sibson [1988] IRLR 305).

Even if employers do have the benefit of a mobility clause in employment contracts, they need to consider its interplay with other relevant clauses. In United Bank v. Akhtar [1989] IRLR 507 the employer, who wished to rely on a mobility clause, refused to exercise its express contractual discretion to pay relocation expenses. The tribunal held that the employer's actions breached three terms implied into the employee's contract, namely 1) that the employer should give reasonable notice of any move, notwithstanding the scope of the mobility clause, 2) the employer would not exercise its discretion to provide relocation expenses in a way which made the employee's performance of his duties under the contract impossible and 3) the employer would not act in such a way as to damage the relationship of trust and confidence between the parties. Employers should therefore always give employees reasons for any such proposed change and notice of when that change is expected to take effect if they want to avoid an argument that the implied duty of mutual trust and confidence has been breached.

Where there is no suitable mobility clause to rely upon, the move may amount to a redundancy situation. A redundancy consultation procedure should be followed, and the change of location be considered as potentially alternative employment in a redundancy situation (which may be subject to a statutory trial period).

In any new smart working environment, employers should ensure that they are applying a co-ordinated and consistent approach in the treatment of staff. This includes in dealing with requests for flexibility in working hours, or working arrangements. To avoid potential discrimination complaints, employers should also ensure that employees who spend a large amount of time working remotely have the same access to opportunities as their colleagues who spend more time physically present in the office. This can often be achieved by using technology to disseminate information. If employees feel that they are being treated less favourably than their colleagues, they may as a minimum raise a grievance or complaint about that treatment. Even if this is not well founded, it may incur management time and cost.

Smart working arrangements will not necessarily work for, or in respect of, all staff. There may be certain times that staff need to be physically present in the office to avoid an impact on business performance. There may be risks if too many employees are absent from the office at the same time due to remote working. Certain roles within the business may not be able to be performed from home, or remotely. However, most of these issues can typically be overcome with some prior planning. They will not necessarily be a reason to shy away from a new smarter way of working. As the recent government move has demonstrated, smart working is not only for employers looking to reduce their property costs, but can have real benefits for employers in respect of employee welfare, engagement, and recruitment and retention.