Business

Flexible working rights for all - could they backfire?

  • 30 June 2014
  • From the section Business
Woman working from home

Fancy working from home? Wishing you could drop down to a four-day week?

Well, don't just sit there. Ask!

From now on, providing you are a UK employee, you will have a legal right to request this, and your employer will have a legal obligation to answer.

And not just that - they will have a legal obligation to provide a valid reason if they cannot say yes.

Until now, parents of children under the age of 16, and those registered as carers for children or adults have had the right to ask for a change in work patterns that better suits their home life.

But now the same rules will apply to all employees, regardless of their dependants, provided they have worked for their employer for at least 26 weeks.

It allows them one "flexibility request" per year.

'Cost to businesses'

The government says it wants to remove the "cultural assumption" that flexible working only applies to parents or carers, and that in bringing in these changes it wants to make workplaces "fit for the 21st Century".

But employers' groups are worried things could backfire, making it harder for those more in need of flexible working, increasing the risk of discrimination claims, and adding unnecessary red tape.

"One of the main questions we're getting from our members is: will it become illegal for me to give priority to people who are parents or carers?" says John Wastnage, head of employment at the British Chambers of Commerce (BCC).

Image caption The right to request flexible working previously only applied to parents or carers

"And the answer is yes.

"A lot of our members already offer flexible working anyway, often informally, so this change is unnecessary and it could just push up time and cost to businesses," he says.

'Negative dynamic'

The Federation of Small Businesses (FSB), while encouraging flexible working, is worried that this change in the law is sending the wrong message to workers.

"While the new procedure is designed to be light-touch, inevitably it will entail additional administration that the smallest of businesses will have to learn and may struggle to apply," says FSB chairman, John Allan.

"Where requests are declined, our experience shows 'the right to request' can introduce an unwelcome negative dynamic into the workplace."

That "negative dynamic" could be exacerbated when an employer is faced with multiple, conflicting requests.

The UK's leading business lobby, the Confederation of British Industry (CBI), says it has called for better guidance on what employers should do in this situation.

And when the BCC asked for clarification, the response was to "put the names in a hat", says Mr Wastnage.

"That's no way to run a business," he adds.

"I think there's a risk that some businesses will take a view that they're not going to accept any requests because of the risk of discrimination."

Litigation concerns

That risk of discrimination, say employers' groups, leads to the risk of costly employment tribunals, should workers not get their way or feel hard done by.

The conciliation service, Acas, is not expecting the change to generate a flood of new cases, bearing in mind a tribunal's potential risks and rewards.

"I don't think many employees will risk their work relationship for the sake of eight weeks' pay compensation," says Steve Williams, Acas head of equality services.

Image caption There are fears the changes could lead to more employment tribunal cases

"It's only a right to ask, and it's certainly not a right to have - and this is a key element."

Nevertheless, the government has estimated the change could bring up to 150 extra tribunal cases every year, each costing employers an average of £5,900.

That would be an increase of more than 50% on the 277 tribunal cases brought for these reasons in 2010-11.

It is, however, a tiny fraction of the 190,000 claims taken to tribunal in 2012.

Culture change

A spokesman for the Department for Business, Innovation and Skills, says: "We want these reforms to bring about a culture change in Britain's workplaces.

"Family-friendly policies and economic growth can go hand in hand. Flexible working really can help employers boost productivity and profits."

In its impact assessment on the rollout of flexible working to all employees, the government estimates that in its first 10 years the new policy will bring overall economic benefits of about £475m.

Most of that, it thinks, will come from increased productivity, lower labour turnover, and reduced absenteeism.

It could be particularly helpful, the government says, for workers who might need to look after grandchildren, or those who want to take part in voluntary work.

And then there are the potential knock-on positive effects - the chance to further reduce unemployment, or the theory that a better work-life balance will improve employees' health.

The change would apply to more than 10 million employees, and the government estimates it would lead to the agreement of more than 60,000 new flexible working arrangements every year.

But according to snapshots of the existing workforce, many employers' doors are already very much open to flexible working requests.

Evolution not revolution

About 96% of firms already offer some form of flexibility - from British Gas to Marks and Spencer - according to a 2012 survey from the Chartered Institute of Personnel and Development (CIPD).

Moreover, almost two-thirds already provide a right to request it.

Image caption According to the CIPD, 96% of employers already offer flexible working

Perhaps not surprisingly, the smaller the company, the less likely they are to be quite so accommodating, but not by much - about 90% of smaller firms offer flexible working, according to the CIPD survey.

"This is an evolutionary thing, not a revolution," says Steve Williams of Acas.

"The challenge is making sure managers making these decisions actually get them right, and that they don't approve without thinking, otherwise you'll get a workplace that isn't functional."

The extension to the flexible working rules comes alongside the introduction of "parental leave" which, from next April, will combine maternity and paternity arrangements into one package.

Working couples will have the option to share up to 50 weeks' leave and 37 weeks' pay in the first year of their child's life.

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