Changes that will extend the right to request flexible working have finally been put in place after the Children and Families Act was given its long-awaited Royal Assent in Parliament in March. These changes are due to come into force from 30 June 2014.
Currently, only employees with children under 17 (or those with disabled children under 18) and those who have responsibilities as a carer have a right to request flexible working. The new law extends this right, and means that, from 30 June 2014, any employee with 26 weeks' continuous service will be able to make an application to work flexibly for any reason.However, it’s not all bad news for employers – they will receive some flexibility too. The new law dispenses with the statutory procedure for consideration of flexible working requests, replacing it with a duty on employers to deal with requests in a ‘reasonable’ manner. This briefing considers what the future of flexible working will look like: what the extended ‘right to request’ will involve, what dealing with requests in a ‘reasonable manner’ means and what employers should do to get ready for the new flexible working regime.
The legislation does not give employees the right to work flexibly. Instead it provides a right to request flexible working. Eligible employees can request a change to working hours, working time or working location. This includes a wide range of working patterns, such as job sharing, working from home, part time working, compressed hours and flexitime. Currently, any employee with caring responsibilities can make a request for flexible working. The employee must have 26 weeks’ continuous employment and must not have made a flexible working request in the past 12 months. The new legislation removes the requirement that an employee must have parental or caring responsibility in order to make a request. This means that all employees who have the necessary period of service with their employer will have a right to request flexible working regardless of caring responsibilities.
So for example, employees may request to work flexibly alongside a further education course, or in order to combine working with helping to care for grandchildren. Employees may even request to work flexibly simply in order to spend less time at work. Currently, there are prescriptive procedures which employers must follow when considering a flexible working request. The new legislation removes these procedures and replaces them with a duty on employers to deal with requests in a ‘reasonable manner’. The complexity of the current statutory procedure has been roundly criticised and so the relaxation of the stringent process is helpful for employers in removing an administrative burden. However, the concept of dealing with requests in a ‘reasonable manner’ introduces some uncertainty – what does a ‘reasonable manner’ actually mean in practice?
What does the legislation tell us?
The legislation specifically states that an employer can only reject the flexible working request if one or more of eight specified business grounds, where refusal would bring or lead to:
- additional costs;
- an effect on the ability to meet customer demand;
- inability to reorganise work among existing staff;
- inability to recruit new staff;
- a detrimental impact on quality;
- a detrimental impact on performance;
- insufficiency of work during period of work proposed by the employee; or
- planned structural changes.
- It also states that all requests, including any appeals, must be considered and decided on within a period of three months from first receipt, unless an extension is agreed. The request can be treated as withdrawn if the employee, without good reason, fails to attend two consecutive meetings to discuss the request or an appeal.
What does ACAS tell us?
Given that the legislation does not go far in helping employees and employers alike understand the concept of ‘reasonableness’, the government has provided guidance which goes some way towards providing a format which can be understood by both parties. ACAS has now published the final draft Code of Practice (the Code) and supplementary guidance (the Guidance) on handling requests to work flexibly. The Code will have statutory force and will be taken into account by employment tribunals when considering relevant cases.
The employer’s decision
The Code sets out that on receiving a request, an employer should arrange to discuss it with the employee as soon as possible. It is good practice for an employer to allow employees to be accompanied at a discussion by a work colleague or a trade union representative if they wish. The employer should then consider the request objectively, carefully looking at the benefits of the requested changes in working conditions for the employee and the business and weighing these against any adverse business impact of implementing the changes. The employer must weigh up the advantages, possible costs and potential logistical implications of granting the request.
If the employer accepts the request, or accepts it with modifications, the employer should discuss with the employee how and when the changes might best be implemented. If the employer rejects the request it must be for one of the 8 business reasons set out above and an explanation of these reasons, including how they apply to the application, must be given to the employee.
How to deal with competing requests?
In light of the extension of the right to request, it is conceivable that employers may receive competing requests from team members. The question for employers is how such requests should be managed? The Guidance recognises that, in such situations, it may not be possible to agree to all requests. It suggests that each request should be taken in turn; having considered and approved the first request the employer should remember that the business context has now changed and can be taken into account when considering the second request against the business reasons.
The Guidance suggests that employers might consider the following:
If the employer is unable to distinguish between all of the requests, it may consider (with the employees’ agreement) some form of random selection such as drawing names from a hat. If such a selection process were used, it would be good practice to make this approach known to all employees from the outset in a flexible working policy.
If the employer cannot accommodate any further requests for flexible working it may consider calling for volunteers from existing flexible working employees to change their contracts back to other arrangements thereby creating capacity for granting new requests to work flexibly.
If the employer is not sure whether it can accept the request for business reasons it may agree (in writing) flexible working arrangements for a temporary or trial period rather than rejecting the request. In fact, in all cases it may well be sensible to have a yearly contractual review right so that the employer can re-assess the business need and the employee can regularly review his or her situation.
What are the impacts of discrimination laws?
The Guidance also makes clear that employers are not required by the law to make value judgments about the most deserving request; an employer should consider each case on its merits looking at the business case and the possible impact of refusing a request.
However, in considering requests, an employer must be careful not to inadvertently discriminate against particular employees because of their protected characteristics under the Equality Act 2010 including for example, disability, sex, pregnancy and maternity. Employers should therefore be careful where, for instance, flexible working arrangements would be a reasonable adjustment for a disabled employee, or where a rejection of a new mother’s request to work flexibly could be seen as indirect sex discrimination.
So, how should employers deal with competing requests where some requests come from protected groups – for example if the employer receives one flexible working request from a working mother and the other from a women who wants time off to attend a professional course?
Realistically, against the threat of potential sex and disability discrimination claims from some groups of employees, value judgments will inevitably have to be made by employers.
What are the consequences of breach?
Employees may be able to bring a legal claim if they think they are being treated badly because they asked for flexible working arrangements.
The employee may bring a tribunal claim if the employer wrongly treats the request as withdrawn or if the employer's decision is not made in time. The claim must be brought within three months of the date on which the application is treated as withdrawn or the final decision is communicated. The tribunal may order the employer to reconsider the application and may award compensation not exceeding eight weeks pay.
How should employers prepare?
Review and amend existing flexible working policies. ACAS recommends that employers should formulate a clear written policy for handling flexible working requests, in consultation with employees and their representatives (including recognised trade unions). This will help to ensure consistency in handling requests and can also make it easier to communicate information on the right to request to employees.
Review home-working practices and policies. Employers will still be responsible for health and safety of employees on flexible working arrangements. Home-working practices and polices should take account of factors such as workplace assessments and the provision of IT equipment.
Consider training for managers. Managers may be well placed to take decisions on flexible working requests, being closer to individuals and therefore better placed to see how flexible working could work for a specific employee from a practical perspective. Additionally, in practice, many employees will choose initially to make an informal approach to their line manager about changing their work pattern. Line managers should therefore be aware that they must not be seen to reject the request outright; they should be supportive and encouraging, even if this means directing the employee to make a formal statutory request.
Consider examining in advance the staffing requirements of the business. This will help employers deal with requests and justify their decisions.
Should employers embrace these changes?
Whilst the aim of the Children and Families Act is to help people achieve a better balance between their work and home life, employers can benefit too. Business research suggests that, in light of technological advances, not only is flexible working viable, but Generation Y has come to expect it. Flexible working is therefore a hot topic: not only does it enhance motivation and loyalty it also lowers staff turnover and helps to recruit and retain top talent.
However, to make flexible working ‘work’ it will be important to ensure that employees understand not only their rights, but also how business needs will inform employers’ decisions. Remember that employers will still be able to reject requests if there are legitimate business reasons for doing so. A clear right to request policy should help to ensure buy-in to these business-focused decision making principles, ensuring that the right to work flexibly operates to the benefit of both employees and the organisation as a whole.