Employment Right Bill Series – Flexible Working “Further Flexion”

This first Insight in the ERB series is Further Flexion by Suzanne Nulty, considering the government’s proposals in respect of the flexible working requests regime.

View our previous insight on the key points from Labour's highly anticipated Employment Rights Bill 2024.

Introduction

In what is becoming a familiar pattern for those of us studying the Employment Rights Bill, the government is taking steps to go further than its Conservative predecessor by further extending the additional provisions already introduced to flexible working rights by the Tories in April 2024.

The Previous Changes and Current Regime

Since 06 April 2024, employees have been able to make a flexible working request from day 1 of their employment (it had previously been necessary to accrue 26 week’s service). They are now also permitted to make two requests per year rather than 1, and do not need to explain or suggest solutions for any effect the change might have on the employer.

The regime was also ‘improved’ by the Conservatives’ move to reduce employers’ response deadline – moving to two months from three – and requiring them to consult the employee to explore potential alternative options, before delivering any decision to refuse the request.

The future of flexible working | Weightmans (January 2024 – Consultation Response)

Family friendly rights upgraded | Weightmans (April 2024 – Changes imminent)

Proposed Further Changes under the Employment Rights Bill

The need for a reasonable reason for refusing a flexible working request

In the Next Steps to Make Work Pay policy document (Next Steps) published alongside the Bill, the government states that it is ‘making a number of immediate changes* – including making flexible working the default’; and that the proposed changes ‘will ensure more requests are agreed’.

What the Bill actually proposes (at section 7) is that an employer may only refuse a request if it is reasonable to do so. Therefore, rather than flexible working being the ‘default’, a more accurate description is perhaps that an employer will need to grant a flexible working request unless it is reasonable to refuse it.

Whilst a relatively simple change, it is not insignificant as it will mean that employees can bring employment tribunal claims to challenge the substance (reasonableness) of their employers’ flexible working decisions, and not only procedural breaches.

Perhaps surprisingly, the eight permissible grounds for refusing a request remain unchanged:

‘(i)the burden of additional costs,
(ii)detrimental effect on ability to meet customer demand,
(iii)inability to re-organise work among existing staff,
(iv)inability to recruit additional staff,
(v)detrimental impact on quality,
(vi)detrimental impact on performance,
(vii)insufficiency of work during the periods the employee proposes to work,
(viii)planned structural changes, and
(ix)such other grounds as the Secretary of State may specify by regulations.’

There is also no proposal to change the penalty an employer will face if found by an employment tribunal to have breached the flexible working provisions; so it will remain at eight weeks’ pay, currently capped at £5,600 until April 2025.

Requirement to explain the rationale for a refusal

If, following the appropriate consultation and due process, the employer ultimately decides to refuse a request for flexible working on one or more of the eight specified grounds, when communicating that information to the employee, it must now also specify why it is reasonable to refuse the request on that ground(s).

Essentially, this means applying the specific facts or circumstances of the parties to the business-type reasons encapsulated by the ‘grounds’, rather than just giving an anodyne “legal” response which previously often left the employee frustrated and unclear on the real issues preventing them achieving the working pattern / hours they wanted.

Written decision and explanation?

Neither the existing legislation nor the Bill (again surprisingly) currently specifies that the employer’s communication of its decision must be in writing, but the ACAS Code of Practice on requests for flexible working | Acas does. We anticipate that the Bill may be updated to match this (or associated regulations introduced).

Timing – When will these changes happen?

Despite listing the flexible working ‘default’ as one of its ‘immediate changes’, the Next Steps document goes on to state that ‘It is important to take account of a range of views, and we will develop the detail of the approach in consultation and partnership with business, trade union and third sector bodies.’

We consider these flexible working changes to be one of the most straightforward areas of reform, so expect that it will be covered in one of the first consultations. However, since the Bill was published last week, there has been no further information about when the first consultation(s) will begin or which aspects they will relate to. We will, of course, keep you updated.

In the meantime, the Bill will receive its second reading in Parliament on Monday 21 October, when it will be debated in the House of Commons.