Government reforms (1): Flexible working

What do we already know?

In our November 2012 Newsletter, Family friendl(ier): working on the childcare conundrum…  we let you know that the Government proposes to:

• extend the right to request flexible working to all employees (not just those with parental responsibility for a child or caring responsibilities for an adult);
• replace the current “right to request” procedure with a duty on employers to deal with requests in a reasonable manner, and within a “reasonable” period of time;
• create a statutory code of practice to give guidance on the meaning of “reasonable” to employers; and
• provide guidance to employers on how to prioritise conflicting requests that are received at the same time.

The current 26-week qualifying period of service necessary for employees to have the right to make a request for flexible working will be retained.

In our recent newsflash, Flexible working delay, we informed you that, although the above reforms were due to come into effect on 6 April 2014, they have been delayed to a date as yet unconfirmed.

On 25 February 2013, ACAS launched a consultation on a draft statutory Code of Practice for this area of law. The consultation closed on 20 May 2013.

What is the news?

ACAS has published its statutory Code of Practice for handling requests to work flexibly, together with non-statutory, ‘good practice’ Guidance. These clarify the changes to flexible working.

The Code and the Guidance are currently in draft form, as they are still awaiting Parliamentary approval. However, the reality is that they are now unlikely to change.  The Code will be taken into account by Tribunals when considering relevant cases, although it is not, itself, legally enforceable.

What does the Code of Practice say?

According to ACAS, the Code is “deliberately concise” and “principles based”. It recommends that, unless instantly granting the request, employers should:

• talk to/meet with the employee as soon as possible after receiving a written flexible working request (in a private place, wherever possible);
• inform the employee of the right to be accompanied at any discussion (the Guidance says the employee may be accompanied by a work colleague or a trade union representative);
• discuss the request with the employee, again in a private place if possible, to get a better idea of the changes they are looking for;
• consider the request. This involves employers:
  • considering the request carefully and weighing any benefits against any adverse business impact, whilst ensuring there is no discrimination;
  • making decisions in writing as soon as possible;
  • if the employee’s request is accepted (whether fully or with modifications), having a discussion with the employee about how and when the changes might best be implemented; and
  • only rejecting an employee’s request for one of the permitted statutory business reasons, which the Code sets out in full.
• allow employees to appeal against a decision to reject their request. Talking to an employee about the decision may reveal new information or a failure to follow a reasonable procedure; and
• deal with requests promptly. All requests, including any appeals, must be considered and decided on within three months from first receipt, unless an extension is agreed.

The Code also refers to an employer’s entitlement to treat an application as ‘withdrawn’ where an employee fails to attend a meeting and a further rearranged meeting to discuss the application (including any appeal) without a good reason.

What does the ‘Good Practice’ Guidance say?

The Guidance includes advice (along with helpful examples) on:

• how to handle multiple requests, prioritisation issues, and being fair

When receiving more than one request, an employer is not required by law to make value judgements about the most deserving request – each case should be considered on its merits looking at the business case and the possible impact of refusing a request.Where an employer cannot approve a request because a number of other employees are already working flexibly and to do so would impact adversely upon the business, it would be good practice to consider calling for volunteers from existing flexible working employees to change their contracts back to other arrangements so as to create capacity for granting new requests.

• avoiding discrimination in deciding a request

When considering business reasons, an employer must be careful not to inadvertently discriminate against particular employees because of any protected characteristic, and it gives several helpful examples.  One example is of a man asking for flexible working to care for his children.  The employer regularly allows female employees’ flexible working for this reason but refuses the man’s request simply because he is a man and believes childcare is less important to him.  This is likely to be direct sex discrimination.

• providing an explanation of the business reasons that are to be considered in requests – what do they mean, with examples and tips

• refusing a request

• appeals against refusal and guidance on managing this process

There is a separate section on this, making clear that, while the law does not require an employer to offer an appeal, it should do so if there is new information that was not available when the original decision was made or if the employee thinks the application was not handled reasonably in line with the employer’s policy.  In addition, it could also help avoid the employee raising the issue as a grievance.

• how to use trial periods and reviews after agreeing a change – to check out if a flexible working request is feasible

The Guidance contemplates that employers considering whether to grant flexible working requests may wish to confirm a temporary agreement to work flexibly, which may often be a more practical solution.

Comment:

This new flexible working regime is intended to be much simpler than the existing regime, and to give employers the freedom to consider flexible working requests “in a way that suits them” (subject to the reasonableness requirement and taking no longer than three months if no extension is agreed).

It is only a matter of time before this new regime becomes law, so employers do now need to start planning for a review of their current flexible working policies and procedures in light of these changes to check that they are ‘fit for purpose’:

• your policy will need to reflect the fact that all employees, not just those with caring responsibilities and those with children under a certain age, will be able to make requests provided they have at least 26 weeks’ continuous service; and
• If your flexible working procedure reflects the current, more prescriptive regime, you may wish to amend it to allow for the more flexible “principles-based” approach taken under the Code.

Employers may well also wish to consider providing training for managers to ensure requests are dealt with consistently across the business.  It is essential for employers to develop a consistent approach across a workforce, so that all requests are treated fairly, or risk an increased exposure to claims. Although an employer’s failure to consider a flexible working request would only result in a penalty of up to eight weeks’ (capped) pay, keep in mind that a decision to refuse a request can in some cases also lead to a much more serious claim of discrimination, with potentially unlimited compensation.