Working from home (WFH) has become a lifestyle that many people have no intention of giving up. 

There’s the time and money saved by not commuting and the comfort of being in your own home (and being able to hang out a load of laundry during a break from the workstation). 

With the worst of the pandemic seemingly over, employers are having to accept that WFH — or hybrid working with a few days at home and a few in the office — is here to stay. 

The trend has suddenly made large office space surplus to needs, prompting some employers to consider relocating to more suitable smaller premises. 

It’s a situation many Ai Group members are finding themselves in, says Ai Group Workplace Lawyers’ Harry Black. 

“It’s a huge problem, especially in Victoria where you just can't get people back to the office,” he said. 

“Occupancy is at 30-40 per cent in the CBD, so it's a real issue.” 

Think before you move 

There are many issues employers need to consider before downsizing.   

“Firstly, think about how many people, realistically, will come into the office on a given day,” Mr Black said. 

“This will dictate the extent to which you can downsize. Secondly, and relatedly, how can you seize this molten moment in history to reimagine the office as a place from which people feel enticed to work? 

“This means developing a rationale to return beyond blunt compulsion or singing the praises of ‘being together’.  

“Only this rationale, in my view, will countervail the allures of working from home. An overzealous direction to return risks alienating people in a tight jobs market. Who wants to lose a good employee for the sake of having an extra warm body in the office?”   

WFH may be appealing for workers, but businesses have needs, too.  

“Our members are saying: ‘We need people back in the office’,” Mr Black said. 

“‘We need them to be client-facing. We need to build a good team culture. I need to properly performance-manage employees, discipline them, liaise with them, assist them, mentor and train them and monitor them. I can't do that remotely.’” 

With hybrid work being an acceptable compromise for many, downsizing office space makes sense. 

During this process, it’s important to:  

  •  Consult 

Talk to your employees to get a sense of what they want. 

  • Embrace hybrid working 

If a hybrid arrangement is possible within your business, embrace the benefits it brings. 

  • Determine what sort of organisation you want to be  

“If you decide that it's in the best interest of the organisation to be predominantly in the office, you've got to make that decision,” Mr Black said. 

“You might burn off a few staff along the way, but that's the organisation you want to be. You've got to have conviction, whatever you do.”  

  • Ask why? 

Examine the reasons why people like working from home. Is it to save money? Is it for convenience? 

  • Improve office appeal 

“It’s no longer a default position to have people come into the office,” Mr Black said. 

“You've got to develop a persuasive rationale to get them back in there, and the only practical way of doing that is by rendering the office better than home as a place to work.” 

Perks that work 

Make coming into the office worth their while, says Mr Black. 

Consider offering:  

  • excellent technology  
  • ergonomic furniture 
  • an aesthetically pleasant space 
  • free parking 
  • catering 
  • guest speakers  
  • proper team-bonding sessions or  
  • end-of-trip facilities. 

“Bear in mind that you can only do so much,” Mr Black says.  

“You can’t write a blank cheque. While people won’t accept a bare assertion that we’re better off in the office, there is a limit to what you can do.” 

Benefits and pitfalls 

“The obvious benefit of downsizing is saving on rent,” Mr Black says. 

“Pitfalls involve choosing: the wrong location, space that is cramped or a poorly designed floor plan. It is important to downsize in a considered way.” 

When all else fails, there’s the law  

“There is an express contractual requirement in most employment contracts that the job be performed at the business address or where the employer says,” Mr Black said. 

“If not, there’s an implied requirement to obey lawful and reasonable directions.  

“Subject to other legal obligations (e.g. anti-discrimination, general protections, requests for flexible work arrangements), a direction to return to the office environment will be lawful and reasonable. 

“In most cases, there is no contractual or legal entitlement to work from home.” 

Times have changed since the height of the pandemic. 

“Back then, employees could argue that it wasn't reasonable to come back to the office,” Mr Black said.  

“To do so might have infringed on workplace health and safety duties because of the risk of transmission, new and virulent strains and so forth. 

“But now that the pandemic has receded, employers can, with confidence, make those directions.” 

However, the legalities are largely academic, with cultural and retention factors now dominating the hybrid argument. 

“These days, employers are thinking: ‘Can I get people back in? Will they bristle with hostility if I force them back? Would I lose them as employees?’” 

Ai Group Workplace Lawyers can help  

“We can provide strategies on how to manage the transition back to the office and how to mitigate the risks associated with more recalcitrant employees,” Mr Black said. 

“Ultimately, people get back into the swing of things pretty easily.  

“We’ve adjusted very quickly to WFH and conversely, we can adjust quickly to a hybrid way of working.” 

If you need employment law advice or have any questions about the interpretation of industrial instruments and contractual issues, please contact Ai Group Workplace Lawyers on 1300 55 66 77.   


Wendy Larter

Wendy Larter is Communications Manager at the Australian Industry Group. She has more than 20 years’ experience as a reporter, features writer, contributor and sub-editor for newspapers and magazines including The Courier-Mail in Brisbane and Metro, the News of the World, The Times and Elle in the UK.