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What company directors need to know about flexible working hours

Flexible working can improve job satisfaction for employees, and on a practical level allows people to meet their family commitments and other responsibilities without having to change jobs.

The majority of staff who have worked for a company for 26 weeks or more, either on a full-time or part-time basis, may apply to change their working hours, although an employer can allow all staff to do this if they wish.

Members of staff cannot make further requests for flexible working within 12 months, however. So what do company directors need to know when it comes to flexible working hours, and how can they deal with the inevitable changes in their business?

What types of flexible working hours are there?

In addition to part-time hours and flexitime, which are relatively common these days, other working hour schedules requested could include:

Compressed hours

In this case an employee works the standard number of hours, but over a shorter period of time than usual – working longer days for three or four days a week, for example.

Annualised hours

Annualised hours contracts allow employees to work a set number of hours during the year, but the pattern of working can change regularly. This type of contract is often useful for shift workers, or those whose employer requires staff cover 24/7 for the entire year.

Staggered hours

A staggered hours contract allows an employee to start and finish their working day at different times.

How to deal with a request for flexible working hours

There’s a time limit of three months for employers to deal with requests for flexible working. This includes time for an appeal, although the overall timescale can be extended if the employee agrees.

Although not obligatory, it’s good practice for employers to meet with their employee to discuss the request for flexible hours, and to find out more about their reasons for doing so. It’s also a good idea to allow a work colleague of the employee, or other representative, to attend the meeting.

If the request cannot be met, there may be room for compromise – perhaps flexible hours could be granted on a temporary basis, for example, or with the proviso that the arrangement will be reviewed after a certain time.

Granting an application for flexible working

If flexible working hours are sanctioned, this change becomes permanent and the new terms need to be included in the staff member’s employment contract. Other members of staff will also need to be informed of the new arrangements.

So what other considerations could there be for company directors under these circumstances?

  • Whether the arrangement should be made on a trial basis
  • There may be a need to amend the employee’s holiday entitlement and rate of pay
  • A fair reallocation of work among other employees may be required
  • Additional cover for the hours previously worked by the employee will be needed
  • Employees working flexibly must be treated in the same way as full time workers
  • The Working Time Regulations apply to those working flexibly as well as to full time employees

Refusing a request for flexible working hours

All requests must be appraised in a ‘reasonable manner’ and although employers aren’t obliged to sanction flexible working hours, by law they must have a clear business reason for refusing.

This should be one or more of the following reasons as set out by the Advisory, Conciliation and Arbitration Service (ACAS):

  • The burden of additional costs
  • An inability to reorganise work amongst existing staff 
  • An inability to recruit additional staff 
  • A detrimental impact on quality
  • A detrimental impact on performance
  • Detrimental effect on the ability to meet customer demand
  • Insufficient work for the periods the employee proposes to work
  • Planned structural changes to the business

Is there an appeal process for employees?

Employees can follow the company’s internal appeals procedures if they want to challenge a refusal to their application. They may also have reason to make a formal complaint to an employment tribunal – if they’ve been treated badly by the employer, for example – but they cannot do this simply because the application has been refused.

In some cases, an informal chat with the employee can resolve matters. The member of staff may also wish to approach their trade union representative for advice on how to proceed.  

Record-keeping and other considerations

Records should be kept on who has applied for flexible working, and the company’s response. Any new arrangements will need to be monitored to ensure they’re working well for both employee and the company.

Generally speaking, offering flexible working hours can encourage staff retention, and attract talented individuals into the business. It promotes job satisfaction and can also benefit the business by reducing the costs of absenteeism and recruitment.

Written by Keith Tully, partner at Real Business Rescue; Keith has more than 25 years’ experience advising UK business owners on a range of financial issues including insolvency, tax and raising finance.