RTO Chickens Come Home To Roost
The return-to-office mandate has once again hit the headlines over the last few weeks.
Amazon RTO = outage
Firstly, there has been speculation that Amazon’s 5-day RTO mandate led to the Amazon outage that affected millions of apps, websites, and services in October 2025.
Nick Bloom, writing on LinkedIn, said:
“Cause: Amazon cancels WFH, a huge number of employees leave, particularly high performers in booming areas like Cloud and AI.
Effect: Amazon loses a bunch of top talent. Its AI business starts struggling, and its AWS cloud service has a massive outage.”
Joe Procopio, a multi-exit, multi-failure entrepreneur, technologist, and innovator, wrote an article in Inc. called “Amazon’s return-to-office chickens come home to roost.” He connected the dots and concluded that the exodus of senior talent from Amazon Web Services might be why it took forever to figure out why it broke the internet.
Corey Quinn’s article in The Register leaves no doubt. In “Amazon brain drain finally sent AWS down the spout” he notes that Domain Name Service (DNS) is often the culprit for these issues, and AWS certainly knows this.
Corey says, “And so, a quiet suspicion starts to circulate: where have the senior AWS engineers who've been to this dance before gone? And the answer increasingly is that they've left the building — taking decades of hard-won institutional knowledge about how AWS's systems work at scale right along with them.”
“When that tribal knowledge departs, you're left having to reinvent an awful lot of in-house expertise that didn't want to participate in your RTO games, or play Layoff Roulette yet again this cycle. This doesn't impact your service reliability — until one day it very much does, in spectacular fashion. I suspect that day is today.”
Many like me saw this coming, but we did not know when or where. When you employ adults who know when it makes sense to work out of the office for themselves and their colleagues, but decide to treat them like children, demanding they return to the office on your terms, they will look for employment elsewhere. They will seek an employer who treats them with respect and gives them the flexibility and autonomy to work where they do their best work.
The reality is that you will lose your top talent first - your highest performers – along with their collective knowledge of your organisation and how your systems operate. Add to that the recent replacement of hundreds of technical roles at AWS with AI, and it creates a risky situation. When you need an engineer with experience, intuition, and the ability to make decisions based on subconscious insights - gut instinct - AI is not the solution.
Karlene Chandler vs Westpac
You would most likely be aware of the Fair Work Commission (FWC) in Australia, which has ordered Westpac Banking Corporation to allow an employee to work from home permanently.
This has been seen as a warning to other companies considering implementing return-to-office mandates.
Ordered to allow an employee to work from home
The case has gone viral. Here are some examples.
Human Resources Director (HRD)
Westpac is an Australian multinational banking and financial services company. It is one of Australia’s big four banks and is Australia’s first and oldest banking institution. As of 2024, Westpac has 13 million customers worldwide and employs around 35,000 people. In 2022, Westpac ranked 53rd in the "Top 1000 World Banks".
The case
You can read the media articles, and I encourage you to do so. But I wanted to share my thoughts on the case and its outcomes.
These are the facts. Karlene Chandler has worked for the bank since 2002. She is a part-time worker in the “Mortgage Operations, Certifications and Settlements’ team. She works 8 am to 2 pm every day except Fridays.
In 2021, she and her partner purchased their home in Wilton, New South Wales, further away from the Westpac corporate office in Kogarah than their previous home.
Many others did the same during COVID, yet it gets no mention in most media coverage. Given the success of the unexpected need to work from home during COVID, many people surmised that it would become the new norm. Organisations lacked the foresight to inform employees otherwise.
I know someone who now has a 2.5-hour train journey each way to work. He has no issue travelling into the office when there is a reason to do so, but begrudges having to do it twice a week because it is mandated. He travels for 5 hours to sit in Zoom calls like the rest of his team. He does nothing he could not have done from home. He is not alone.
Many people living in regional areas were able to get jobs with city-based companies during COVID because they could work from home. Now they are being told to travel long distances to attend the office, despite nothing in their contracts indicating that would be the case post-pandemic.
Karlene has two children who attend a school approximately 25-30 minutes away from the family home in the opposite direction to the Westpac Kogarah office. She is responsible for school pick-ups as her self-employed partner often works in Sydney or interstate, leaving home at 4:30 am and returning at 6:00 or 06:30 pm.
She has a history of working remotely. From early 2017, she was only required to attend a corporate office one day per week. In mid-2018, she worked fully remote until her maternity leave in February 2019.
After returning in April 2021, she continued working remotely full-time until August 2022, when she was required to attend the corporate office one day per month.
Westpac has a policy, the Hybrid Working Model (Policy), that allows a mix of in-person and remote work. Westpac’s Policy requires employees to attend a corporate office 2 days each week. The closest corporate offices to Karlene’s residence are Kogarah and Parramatta. It takes approximately 2 hours to travel from the applicant’s children’s school to either location.
In December 2024, Karlene sought approval to work at the Bowral branch for 2 days per week instead of attending the corporate office. An acting senior operations manager approved this as a short-term 'olive branch' to assist with her transition to in-office work. However, in January 2025, a senior operations manager returned from leave and reversed the decision.
Karlene made a formal flexible working arrangement request on 17 January 2025. On 18 March 2025, a team leader reported that the senior operations manager had refused the request without providing a reason.
Karlene asked for reasons on the same day. On 19 March 2025, the senior operations manager sent an email referring to Westpac's remote working policy and said that 'working from home is no substitution for childcare' and 'your arrangements for working remotely may change at any time at Westpac's discretion'.
Karlene then brought her case to the Fair Work Commission, where it was successfully upheld on 20 October 2025.
Westpac claims
The record of the application hearing - the Decision brief - (2025 FWC 3113) makes interesting reading.
Westpac had to concede that it did not adhere to the requirements of Section 65A of the Fair Work Act. It did not respond to Karlene’s FWA request within the required 21 days and failed to provide written reasons for the initial refusal.
“The reasons that were ultimately provided after the applicant requested reasons were cursory at best,” reads the Decision brief.”
“Aside from a brief reference to the Policy in the response, there was no attempt to describe the particular business grounds for the refusal or how those grounds applied to the request. The response did not set out the changes to working arrangements that would accommodate the applicant’s circumstances that Westpac would be willing to make, or state that there were no such changes, or the effect of s.65B and 65C.”
Then it gets interesting.
Westpac said its policy was a measured approach that provided for a mixture of in-person and remote work and enabled it to effectively manage this issue amongst its very large workforce.
Evidence was provided about the benefits of attendance, including fostering collaboration within the applicant’s immediate team and meaningful engagement with stakeholders and others across the broader Mortgage Operations business.
A physical presence in the office also supported centralised operational processes, such as document processing, and more effective team communication.
A bank executive gave evidence about the various methods Westpac used to help team members maintain a customer focus. These included team ‘huddles’ and activities, training sessions and the use of ‘call boards’ at the corporate premises, which convey key messages to staff and which are not accessible to employees working from home.
Westpac accepted that an individual didn't need to be in the office to achieve a particular work function, but rather that the ability of teams to work effectively with each other was much greater if there was a certain level of office attendance and face-to-face interaction.
Karlene’s response
· There were no reasonable business grounds for refusing the request.
· Access to on-site cheque printing facilities was not critical to her essential responsibilities.
· Team collaboration was unlikely to be adversely affected, as the team was designed so that face-to-face contact was not part of the job.
· The team was remote and flexible, clearly functioning well without the need for ongoing in-person attendance.
· Team ‘huddles’ can be conducted using Microsoft Teams, and training sessions are available online.
· Karlene successfully trained two employees remotely during the pandemic and informally assisted them via Teams.
Deputy President Roberts presiding said, “Further, there is no question that Ms Chandler’s work can be performed completely remotely. She has been working remotely for a number of years and doing so very successfully. The evidence confirms that both Ms Chandler and her team have performed at a very high level. Deadlines have been met or exceeded. Ms Chandler’s individual performance ratings are high. A loss of productivity or efficiency or a negative impact on customer service has not materialised as a consequence of the existing remote working arrangements. It is unlikely in my view that a continuation of those arrangements would generate those sorts of adverse results.”
Westpac behaviour
Westpac argued that it would be unfair to allow Karlene to work from home full-time, as they would have difficulty in getting others to comply with their hybrid policy.
Oh dear!
The bank also said that her partner was capable of taking on= a larger role in childcare and that the family's financial position was improving; therefore, they could afford the additional childcare costs.
How dare they?
All employers on notice
This is a landmark decision that I applaud. Westpac could not provide one business reason to deny Karlene’s application.
George Haros, an industrial relations lawyer and partner at Melbourne firm Gadens, said there were key points about WFH that employers should be aware of following the landmark decision. He spoke to Sky News.
“Businesses should be extremely thoughtful in responding, both in terms of the process, the time frame to respond… and also ensuring that they provide adequate business reasons as to why the flexible work request should not be granted in each scenario.”
Westpac clutched at straws. Do employees need to be in the office to read key messages on a call board? Ever heard of the announcement feature in MS Teams or the @everyone tag?
This is a decision that every organisation must consider. Do you have good business reasons to mandate office attendance? Think carefully before you answer that.
“This decision puts all employers on notice that they will need to have genuine business reasons to refuse a flexible working arrangement request; employers will also need to demonstrate that they have met all their obligations under the Fair Work Act before any refusal," Financial Sector Union (FSU) national secretary Julia Angrisano said in an interview with Yahoo Finance.