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On Report in the other place, Lord Sainsbury of Turville introduced five amendments—Nos. 77, 79 and 85 to 87—relating to clause 47, which deals with flexible working. They concern an exemption for the armed forces, and the provision by the Advisory, Conciliation and Arbitration Service of binding arbitration in cases where employer and employee cannot agree.

Lords amendments Nos. 85 to 87 relate to the proposed exemption of the armed forces from the flexible working provisions. As was explained in the Lords, the Bill as previously drafted applied those provisions to the armed forces, but because all members of the armed forces are—uniquely—liable to operational deployment at little or no notice if national interests so require, it was impractical to apply long-term flexible working arrangements, as envisaged in the new right to request. Accordingly, we concluded that the new provisions should not apply to them.

It is worth noting that the armed forces will continue to seek to comply with the spirit of the legislation, subject always to overriding operational requirements. They fully recognise the benefits of flexible working to individuals and their organisations.

Mr. George Osborne (Tatton): I understand that the armed forces have overriding operational requirements, but does the Minister accept that many private businesses

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also have such requirements, and that they cannot simply give time off to employees who want to take a holiday at a given moment?

Alan Johnson: The work and parents taskforce—which consisted of representatives not only of business, but of small businesses in particular—recommended that the right to request be extended as widely as possible. I accept that there are difficulties for businesses, but we and the taskforce successfully overcame them all in formulating these proposals. In the jargon of the day, the taskforce thought small first, and the legislation includes provisions that are aimed at helping small businesses in particular. However, we and the taskforce felt that allowing flexible working for parents of children up to the age of six was beneficial to businesses. In many cases, skills were lost from the workplace because women, in particular, could not combine the pressures of their domestic lives with their professional responsibilities.

Mr. Hammond: We have rehearsed this argument many times, but I still cannot understand how it benefits a firm that already operates good practice to impose such practice on its competitors. Surely we should encourage a climate in which good practice generates competitive advantage, thereby creating a virtuous spiral of employers competing with each other in offering such practice.

Alan Johnson: As the hon. Gentleman says, we have rehearsed this argument many times, and I agree with him completely in terms of work-life balance and people's ability to care for elderly parents, or to pursue hobbies. We are dealing with those issues through measures such as the work-life balance challenge fund. Employers For Work-life Balance—an organisation that was set up three years ago, and which is completely independent of Government—is also playing an important role. However, we decided that, for parents of small children, it would take a generation for best practice to work in the way that the hon. Gentleman suggests.

We decided that everyone has a stake in bringing children up properly and that wider social issues are involved. The introduction of a measure that is not a right to work flexibly, but a right to request to work flexibly—and that puts a duty on employers to consider such requests seriously—is a balanced approach. It will give thousands of parents the opportunity that they have not had before—or perhaps in some companies, such as those to which the hon. Gentleman referred, the courage and the confidence—to suggest to their employers that if they started work at 9.15 am rather than 9 am, they could drop their kids off at school, which would make their working lives much easier. We have a difference of view in relation to working parents, but the proposals were widely supported in two years of exhaustive consultation.

Mr. George Osborne: Surely the armed forces wish to be family-friendly employers. Since an employer may turn down a request for flexible working, why should not the armed forces face the same burden that the Government will put on private business?

Alan Johnson: As I said, the armed forces intend to comply with the spirit of the legislation. They raised some practical concerns in relation not to their civilian staff, who will be governed by the measures, but to their

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military staff. Even in a case in which a member of staff has put forward a perfectly reasonable request, the armed forces may not have the luxury of granting it, because circumstances may mean that they cannot implement those arrangements. As hon. Members will know from discussions in Committee, we thought that we could apply the provisions to the armed forces, but in practice and after consultation with them it was felt that it would not be possible. That is why we have introduced the exemption.

Lords amendments Nos. 77 and 79 provide for ACAS conciliation and ACAS binding arbitration schemes for disputes concerning flexible working. The main priority of the flexible working provisions is to foster dialogue between parents and employers to find a flexible working pattern to suit them both. As part of that commitment, we always intended that there should be a binding arbitration scheme prepared by ACAS to deal with disputes regarding requests for flexible working that cannot be resolved in the workplace. The minor and technical amendments introduced in the Lords allow us to do this.

The provision for a scheme relating to flexible working also helps to ensure that as few cases as possible end up at employment tribunals. Because the arbitration is binding, those who opt to use the scheme also waive their right to have their case heard at a tribunal.

Mr. Hammond: Can the Minister confirm for the record—because the bigger picture is sometimes not visible when we consider Lords amendments—that we are talking about arbitration on whether the proper procedures have been followed, not on the substance of the request for flexible working or the employer's decision that he cannot accede to it?

Alan Johnson: We are talking about whether the request was given serious consideration. Arbitration may also address questions of fact. We are not asking a tribunal or ACAS to second-guess an employer's decision.

I believe that the flexible working provisions lend themselves very well to an ACAS scheme. Disputes arising under the provisions will be relatively straightforward, concerning whether procedures have been contravened or if a decision by an employer to reject an application has been made on the basis of incorrect facts. Those are essentially factual rather than legal issues.

Lords amendment No. 79 will have the additional effect of ensuring that conciliation is also an option in the resolution of any disputes arising out of the flexible working provisions. Again, that is entirely consistent with a key approach of this Bill: ensuring that alternative avenues of dispute resolution are available and contributing towards keeping employment tribunals to a minimum.

Mr. Hammond: As the Minister said, these are largely technical and drafting amendments. I shall return to flexible working arrangements in view of the Minister's comments and the intervention of my hon. Friend the Member for Tatton (Mr. Osborne), but first I should like to deal with two minor points that the Minister will no doubt be able to resolve very simply.

Lords amendment No. 61 would insert into clause 55 two additional clauses, 45 and 46, to be excepted from the general rule that the provisions will come into force

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on such day as the Secretary of State appoints by order. When will they come into force? Will it be immediately after Royal Assent?

Secondly, a substantial number of changes to schedule 8 are contained in Lords amendments Nos. 88 to 95. They would remove pieces of legislation that were originally listed as repeals and revocations in schedule 8. Have those changes been made necessary as a result of amendments to the Bill during its passage in the other place, or are they errors that are being corrected? It would be useful to know.

On flexible working arrangements, and the changes being made under the slightly misleading heading of "minor, technical and drafting" amendments to exempt the armed forces from the provisions, I do not have the reports of the Committee's proceedings with me, but it would not surprise me if, in Committee, Opposition Members had asked the Minister about arrangements for the armed forces. On the face of it, I agree with the Minister. I understand that in employment law, the armed forces are often a special case that must be dealt with differently. However, as my hon. Friend the Member for Tatton pointed out, the right that is being granted is a right only to request flexible working and to have one's request seriously considered. The employer, whether it is the Army, the Air Force, the Navy or, indeed, Smith and Jones auto repairs down the road, can properly consider the employee's request and reject it on the ground that it cannot reasonably be accommodated within the working arrangements of the business. In many cases, the armed forces might legitimately turn down a request for flexible working arrangements, certainly for front-line staff. It is not quite so obvious that a member of the armed forces who is assigned to London-based office duties or cooks the meals in Admiralty House would be subject to the same considerations.

My hon. Friend made a good point: it is not obvious, on the face of it, why the armed forces must be treated differently. Throughout the consideration of these relatively new provisions, Conservative Members have been concerned that this is the thin end of the wedge. The right to have a request for flexible working considered could become—as a result of negotiations between the Government and trade unions, for example—something more, such as a prima facie right to flexible working unless the employer demonstrated why he could not deliver it. In other words, the burden of proof would shift to the employer.

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