One-sided flexibility: Is good work achievable?
17 September 2019
While flexible working practices have boosted employment rates, they have also led to unpredictability for workers. Samantha Mann, CIPP senior policy and research officer, considers the consultation proposals that, if implemented, would impact on employers in this area.
The Taylor Review of Modern Working Practices was of the view that flexibility in the UK labour market was important and should be maintained, however it recommended that ‘Government must take steps to ensure that flexibility does not benefit the employer at the unreasonable expense of the worker, and that flexibility is genuinely a mutually beneficial arrangement. One-sided flexibility can include unreasonable requirements around workers’.
Taylor proposed that that a premium rate of National Minimum Wage (NMW) be paid where insufficient notice is provided to the workers and that the Low Pay Commission (LPC) should be asked to consider the ‘design and impacts’ that such an introduction might have in addressing one-sided flexibility.
Low Pay Commission Review
Taylor later expanded on his thoughts by calling for a one week notice period beyond which additional hours required to be worked would need to be paid at least at the ‘premium’ rate.
In the Response to Government on One-Sided Flexibility the LPC suggested an alternative package of measures to the proposed premium rate as their research has not uncovered any stakeholders who would provide unqualified support to the proposal. Instead they recommended that government should further explore:
- A right to switch to a contract which reflects normal hours
- A right to reasonable notice of work schedule
- Compensation for shift cancellation or curtailment without reasonable notice
Measures to Address one-sided flexibility
In July 2019, along with a significant number of other consultations, BEIS (Department for Business, Energy & Industrial Strategy) published the Good Work Plan Consultation on measures to address one-sided flexibility which seeks to explore in more detail the LPC proposals so as to inform the approach that would be needed should they be implemented. It also seeks to reveal any unintended consequences and impacts that these measures would have on the labour market.
Right to reasonable notice of work schedules
Taylor highlighted that ‘flexibility has been a key part of enabling business to respond to changing market conditions and has supported record employment rates.’ It provides workers with an opportunity to work around other commitments and for many, such flexibility works well.
However, there were also many reports that working with flexible arrangements often results in short notice being given of work schedules and hours which makes budget planning and planning for care responsibilities difficult – if not impossible.
Introducing a reasonable period of notice would discourage poor practice by employers, reduce unpredictability for workers and aid income security and the consultation seeks views on the definition of ‘reasonable notice’ and whether notice periods should differ with different types of work or contexts or different sectors?
Record keeping which demonstrates compliance that the requisite notice period has been given is also considered in the consultation. Many employers use time and attendance systems and such automation would help prove compliance but for many, such record keeping still relies on manual records, and often verbal agreements for small employers, what impact would this have on such processes?
Compensation for shift cancellation or curtailment without reasonable notice
The CIPP held a think tank to bring together payroll professionals and BEIS officials in response to this consultation and many around the table could provide anecdotes of family and friends who had experience of short-term shift cancellations – not all were due to poor practice by employers – but many were. Would the requirement to pay compensation in the event of short-term cancellation drive improved practice by employers? All agreed it would (where poor practice was the cause).
LPC had put forward three options for compensation in this situation:
- The value of the shift in question
- A worker’s appropriate NMW rate multiplied by their scheduled number of hours cancelled
- A multiple of a worker’s appropriate NMW rate e.g. three times NMW
The consultation also gives ‘other’ as an option and further asks whether all types of employer across all sectors should be expected to pay compensation?
Good compliance can only be achieved by good guidance and, as you would expect, guidance or ‘codes of practice’ are considered in this consultation as examples of best practice which would undoubtedly strengthen government guidance but would require BEIS to work in collaboration with Stakeholders and across government departments and we support that proposal.
Have your say
What has become clear throughout this consultation so far is that there are employers who provide good working practices and wouldn’t consider cancelling shifts or hours without compensating their workers, however there are a number who don’t and it is their honest views and experiences that are needed to feed in to this consultation because, if they comply with such proposals, they could well be significantly impacted by increased administrative burden and, where compensation becomes payable, an increased pay bill.
Please have your say by responding to the consultation online – it closes on 11 October 2019.
The CIPP is also running a survey which is open to all until 3 October. We also have a Quick Poll running on each news page of our website to gather views on what compensation rate should be paid – if any at all? The Quick Poll is, as the name suggests, quick.
This article was originally written for Accounting Web