| Previous Section | Back to Table of Contents | Lords Hansard Home Page |
Baroness Turner of Camden: I wonder whether I might put a question to the noble Baroness. She referred to flexi-time, a system with which I have some familiarity, as she clearly has also. I wonder why the noble Baroness introduced that and why she believes, as she apparently does, that flexi-time working is in any way incompatible with the provisions set out in the Bill. I do not understand why she raised that point.
Baroness Miller of Hendon: I referred to it only in the context of Amendment No. 233 that I moved earlier which I said I had spoken to in general terms.
Lord Sainsbury of Turville: The grouping of the majority of the noble Baroness's amendments together in a single debate gives me the opportunity to say some general words on the clause, as she has done, and to mention two changes we wish to make to the clause on Report. I shall then go on to deal with the issues she has raised in moving the amendments themselves.
I make one general point in answer to the opening remarks of the noble Baroness. The measure does not give anyone the right to choose his terms and conditions of employment. It gives him the right to ask to have his terms and conditions of employment changed. It also specifies the procedure that employers have to follow when considering requests and the acceptable business grounds for refusing a request. That is very different from saying that people have the right to change their terms and conditions of employment at will.
For the first time the law will facilitate a dialogue between parents and their employers about working patterns that better meet parents' childcare responsibilities and their employers' needs. It will help remove the stresses parents face in both raising their children and in meeting their work responsibilities.
The Government consulted widely on the issue of flexible working. Throughout the consultation period for the Green Paper, Work and Parents, Competitiveness and Choice, flexible working was identified as the biggest issue for both employers and employees.
Last summer the Government established the Work and Parents Taskforce to look at how to meet parents' desire for more flexible work patterns in a way that is compatible with business efficiency. The task force
consulted widely on how this should be done. Its recommendations have been well documented during Committee stage in the other place. It is worth repeating, however, that key to the task force's terms of reference was the commitment to build on best practice, and to design a light-touch legislative approach to giving parents of young children a right to make a request to work flexible hours and to have this request considered by the employer. I strongly believe that the task force recommendations achieve this and represent a sound workable approach that is acceptable to both employers and employees.By reaching a full consensus of opinion, the task force presented the Government with an opportunity to facilitate a genuine culture change at the workplace to the benefit of employers, parents and their children. That is why we accepted all of its recommendations either in full or in principle. It is also why we have kept as close to its recommendations as possible when translating them into legislation, an approach that we will continue to adopt in the drafting of the accompanying regulations. Among others, the TUC and CBI both welcomed the task force recommendations.
Before I turn to the specific points covered in the amendments, I wish to take the opportunity to inform the Committee of two amendments to the clause that the Government intend to table for Report stage.
The clause as currently drafted applies to the Armed Forces. All members of the Armed Forces are liable to be deployed operationally at little or no notice if national interests require it. These unique features of Armed Forces life make it difficult to apply long-term flexible working arrangements as envisaged in this new right to request flexible working. For these specific and unique reasons it is the Government's intention to table an amendment to exempt the Armed Forces from the provisions of this clause when the Bill is considered at Report stage.
I should add 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 to their organisations.
Our second proposed amendment concerns ACAS. The main priority of the flexible working provisions is to foster dialogue between parents and employers in order to find a flexible working pattern to suit them both. As part of this commitment, it has always been the intention to follow the Work and Parents Taskforce proposal of extending the binding arbitration scheme prepared by the Advisory, Conciliation and Arbitration Service to deal with disputes regarding requests for flexible working which cannot be resolved in the workplace.
The extension of the scheme will also allow us to ensure that as few cases as possible end up at the employment tribunal. Because the arbitration is binding, those who opt to use the scheme also waive their right to have their case heard at tribunal.
However, an amendment is required to ensure that it is possible to extend this scheme. Again, we intend to introduce this amendment at Report stage.I will now address the specific points raised in the amendments that the noble Baroness has tabled. Amendment No. 239 would prevent homeworking from being included within the new right. Specifically the clause allows for eligible parents to request a flexible working arrangement that is a change to, first, the hours they are required to work; secondly, the times when they are required to work; and thirdly, where, as between their homes and places of business of their employer, they are required to work, that is homeworking. There is also a regulatory power to add other changes to an employee's terms and conditions if appropriate circumstances arise, which Amendment No. 240 addresses.
Homeworking is a well-recognised form of flexible working and, with development in technology, is a practice used to good effect by many employers. It need not be worked on a full-time basis. An employee may divide their time between the usual place of work and home.
The amendment would therefore prevent many parents from being able to request to work from home to help them better balance their work and family lives. It would not be sensible to have a clause on flexible working and then to exclude homeworking.
Amendment No. 240 would see the grounds on which an employee could apply for a change in working pattern restricted solely to those set out in the clause. This is clearly inappropriate.
The purpose of new Section 80F(1)(a)(iv) is to ensure that as new flexible working practices develop they can be included within this clause. The subsection achieves this by giving the Secretary of State a regulatory power to specify additional criteria to define flexible working patterns as they develop.
The noble Baroness asked for examples to be given. One example would be the content of work, but this is always rather an irrelevant consideration because, when one puts in a clause to take account of future events, almost by definition one does not know what they will be. It is rather like asking scientists what the results of their research will be. If one knows what the results will be, it is no longer research. If one wants an example, however, it could be the content of work.
Working patterns have changed immeasurably over the past few decades. Due to technological advances we now see many people working from home. Changes in consumer demand now see retail businesses open, in some cases, 24 hours a day, seven days a week.
It is impossible to say how things may change in coming years. If we were to restrict the power from the outset and cater for today's flexible working patterns with no scope to accommodate new flexible working patterns as they develop, it would certainly prevent us from being able to cater for the needs of families and employers in the future.
Amendment No. 241 will require an application to work flexibly to be in writing. As I have already indicated, it is the Government's intention to follow
the Work and Parents Taskforce recommendations as closely as possible. This includes its proposal to require applications to work flexibly to be in writing.Members of the Committee will see that new Section 80F(5) provides the Secretary of State with a regulatory making power to prescribe the form of applications to work flexibly. I can therefore assure the Committee that it is the intention that regulations will provide for applications to be made in writing, either manually or electronically.
I should like to add that it is equally important that employers' decisions about an application or their decisions on an appeal are also made in writing. We will therefore be using the regulatory powers provided in the clause to ensure that the "in writing" requirement applies at these stages also.
Amendment No. 242 would require employees to specify the reason why they require changes to their working patterns other than simply certifying that it is for the purpose of caring for a child. It would require a parent to explain their personal circumstances to their employer. We think that this is inappropriate and over burdensome.
The Government tasked the Work and Parents Taskforce with designing a light-touch process which balanced the rights and responsibilities of both parents and employers.
The introduction of another layer of explanation would require parents to explain their personal circumstances to employers. While I am sure that some of them will do so voluntarily, the task force looked at this in detail and decided unanimously that such extra questioning was unnecessary. In addition, during the consultation on the introduction of paternity leave, employers were asked whether fathers should be requested to prove that they were taking leave for the purpose of caring for a child.
Employers made it clear that they did not want to go into the detail of their employees' personal circumstances. For example, parents might have to reveal relationship difficulties with their partner or reveal that a sister who had been caring for their children was now moving away. What value can that possibly add to the employers' consideration of the case on business grounds?
Amendments Nos. 243, 244 and 246 all concern the eligibility criteria for making an application to work flexibly. Amendment No. 243 would make it absolutely clear that, where a flexible working pattern was agreed, it would be a permanent change to an employee's terms and conditions. An employee would have no automatic right to revert to his previous pattern of work should he desire to do so at a later stage.
I can assure Members of the Committee that that is the effect of the legislation as it is presently drafted and that there is no need for the amendment. The first line of new Section 80F(1) states that:
- "A qualifying employee may apply to his employer for a change in his terms and conditions of employment".
That was the recommended approach of the Work and Parents Taskforce, which found that, having taken the trouble to implement a flexible working pattern, there was little desire among employers to unpick the arrangement. In addition, it was likely to be difficult to do so. For example, a new employee might need to be recruited to cover the parent's absence. If the flexible working arrangement was to come to an end, perhaps several years later, the employer would then also have to consider the impact of the change on the individual recruited to cover the parent's absence.
However, there will be circumstances where, although an employer cannot agree to a request as presented to him, he will be able to do so if certain additional conditions apply; that is, time-limiting the flexible working pattern. The meeting between both parties will provide the opportunity to explore alternatives to find a solution that is acceptable to both parties. In circumstances where an alternative approach has been found that is agreeable to both parties, it will be essential that the employer's letter confirming his decision sets out the basis on which the application is agreed.
Amendment No. 244 seeks to place the qualifying period of 26 weeks' continuous employment in the primary legislation. The noble Baroness asked us to say what we have in mind. Again, I assure the Committee that it is the Government's intention to keep to the Work and Parents Taskforce recommendations and limit the right to apply for flexible working to employees who have been employed for a continuous period of 26 weeks. That will be achieved by using the regulatory power provided for at new Section 80F(8)(a)(i). This period will be consistent with the qualifying periods for adoption leave and paternity leave, which are also being implemented through the Bill.
It is inappropriate to take the approach of setting the period in regulations rather than the approach suggested in the amendment. It ensures the long-term flexibility of the legislation should there ever be a case for amending the qualifying period, whether up or down.
The purpose of Amendment No. 246, which the noble Baroness wishes to add to the end of new Section 80F, is to limit the number of requests that a parent may make to one a year, irrespective of the number of children that he or she may have. As the noble Baroness has already pointed out, subsection (4) of new Section 80F already covers that point. Section 80F(4) reads:
- "If an employee has made an application under this section, he may not make a further application under this section to the same employer before the end of the period of twelve months beginning with the date on which the previous application was made".
The Work and Parents Taskforce went to a great deal of effort to find a test that could be agreed by all sides. The consensus, reached after much debate, was that it is not appropriate to ask the tribunal to second-guess fine business judgments that are made by employers in the light of day-to-day business conditions. The task force decided that decisions on whether a particular flexible working pattern could be accommodated within their business must be left to employers to make and justify.
The effect of Amendment No. 247 would be to introduce a test of reasonableness against the grounds chosen by the employer to refuse a request. This would open up to question whether the employers' decision was or was not reasonable in the light of the circumstances. Whether such a test is necessary is something that the Government will look at when they review this flexible working provision three years after it comes into force. I do not believe that it is right to consider introducing an additional reasonableness test now, when the task force concluded that the legislation, at this initial stage, would work without it.
Employers were concerned that their reasons for declining a request should not be open to examination by a tribunal. Where an employer is unable to accept a request, he will have to specify a sound business ground. To ensure that the business ground is acceptable, it must be one of those provided under new Section 80G(1)(b)of the clause. In addition, when confirming their decision in their letter to the employee, they must also provide a sufficient explanation of why the business ground applies in the circumstances. The role of the tribunal will be to ensure that the procedure has been correctly followed, that a clear business ground has been provided and to consider any disputed facts provided in the rationale to explain why the business ground applies. It will not have a power to suggest that another business ground would be more appropriate.
Amendments Nos. 248 to 251 relate to the business grounds on which an employer may refuse a request and which are specified in new Section 80G(1)(b).
Amendment No. 248 would result in the business ground of,
- "the burden of additional costs",
It is important to lay the emphasis on the "burden" of additional costs to the employer. Any request will incur a cost in management time alone. However, just because there is a cost should not automatically provide a reason for refusing a case.
The relative value of implementing a request is also likely to vary between large and small employers. Large employers are likely to have greater flexibility to accommodate a request and thus minimise the cost. That may not be so for a small employer handling a similar request. The use of the word "burden" ensures that those circumstances are covered.
Equally, I struggle to see what can be gained by replacing the word "staff" with "employees" in the business reason of the,
- "inability to re-organise work among existing staff".
By referring to "staff" in the legislation, one ensures that all the individuals working for a business are taken into account when an employer considers a request for flexible work. The use of the word "staff" will, for example, encompass contractors—whether self-employed or not—consultants and agency workers, to name but a few. These would not be taken into account if the business grounds referred merely to "employees".
It is possible that the majority of the workforce of a business or one of its departments have worker status. It would not be fair towards the employee making the request to exclude those individuals from the count.
The same arguments apply to Amendment No. 250, which would change the ground,
- "inability to recruit additional staff",
- "inability to recruit additional employees of similar capability on similar terms and conditions".
Neither do I think that it is appropriate to say that the person should be replaced by someone employed on similar terms and conditions. For example, if a manager applies to leave one hour earlier each day to pick up his child from school and he does two hours of administration a day, the employer may decide to get an administrative assistant in for one hour each day to cover the manager's absence.
I am also not convinced that adding "incompatibility with" to the business reason, "planned structural changes" provides any added value. This is clearly implied, because an employer is never to decline a request on the basis that a flexible working pattern is compatible with a planned structural change.
Amendment No. 253 would give the Secretary of State power to make regulations to allow the employer to be accompanied to a meeting with an employee to discuss flexible working by an official or representative of an organisation of which the employer is a member.
This right could be exercised only where the employee has exercised his right to be accompanied to the meeting.The idea that the Government should make regulations to tell an employer that they could invite someone to a meeting organised by them is an interesting proposition because the idea that they could not to do so is a breach of human rights legislation. Also, while tempting, it is not one that I believe the Government should pursue.
We have to make regulations about who may accompany employees to such meetings because experience teaches us that employers may seek to exclude individuals external to their own operation—or even internal—from meetings of this kind.
There is no need to do the same for employers. If an employer wants to invite a representative of their local chamber of commerce, of the Federation of Small Businesses or the CBI, for example, to a meeting organised by him, on his premises, there is nothing in the Bill to stop him from doing so.
Has the noble Baroness thought about what should happen in the circumstances in which the employee chooses not to be represented? The effect of this amendment would prevent employers from having the option of inviting someone of their choice in such circumstances—at least, not without the consent of the employee. I do not believe that that would be helpful to employers or that it is what the noble Baroness intends.
Amendment No. 254 would enable an employer to reduce the benefits paid to an employee if they reduce their working hours. The benefit would be reduced pro rata to the hours worked or, if the benefit cannot be divided, it could be replaced by a cash payment that is equivalent to the value of the benefits before the hours were reduced.
The task force recognised that if hours are reduced, pay and other benefits are likely to need to be reduced, too. It is much more straightforward to reduce pay. As we found in earlier sittings, defining—let alone dividing—a benefit can be much more difficult. However, employers already do that. The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 require that part-time workers cannot be treated less favourably than a full-time worker as regards the terms of his contract. Under these regulations, employers are already used to making contractual rights available to those working fewer hours than full-timers on a pro-rata basis. Where they cannot "pro rata" a benefit, the regulations do not prevent the employer, if they wish, to offering payment in lieu.
The consequences of changes in the employee's terms will be provided for, expressly or by implication, in the employee's contract. If a contract provides a rate of pay per hour, obviously less will be due if fewer hours are worked. If a contract provides for benefits if particular criteria are met, what will have to be determined is whether the employee's new terms are consistent with the criteria.
There is nothing in law, therefore, that stops an employer doing what the amendment seeks to give him permission to do. This is clearly something that needs to be stressed in any guidance that is offered on the legislation. I can undertake that we will make sure that that is done.
Amendments Nos. 255 and 256 are extremely similar. They concern the same line of text within the clause. Amendment No. 255 differs from Amendment No. 256 because it adds of a couple of extra words. The noble Baroness asked that Amendment No. 255 should be debated separately while Amendment No. 256 should be included within this grouping. My following comments on Amendment No. 256 will apply equally to Amendment No. 255.
Amendment No. 256, like Amendment No. 255, would add the word "materially" to the provision. The basis of the employee's challenge of the rejection of their application for flexible working would therefore be on materially incorrect facts.
The amendments have to be looked at against the background of the recognition by the Work and Parents Taskforce that all efforts should be made to resolve a disputed request at the workplace. Dialogue between both parties, for instance, is encouraged throughout the procedure that the employee must follow when considering a request. This approach is continued at appeal, which provides a further opportunity to see whether a solution can be found that is acceptable to both parties.
Hence, an employee will only be able to take his or her case to a tribunal where the employer has failed to follow the procedure correctly or, having followed the procedure, the facts on which the employer has made his decisions are disputed.
In any event, the provision as currently drafted delivers what the taskforce wants, and what I believe the noble Baroness wants too. If the employer has based his decision, as the provisions say, on incorrect facts, we are entitled to let the employee conclude without further thought that the facts are material to that decision. To add the word "materially" would simply add unnecessary uncertainty.
Equally, it is fair to say that if an incorrect fact led the employer to refuse a decision, it can be assumed that it was substantial to the decision made. To include the word "substantially" also adds unnecessary confusion.
The initial hearing, the employer's explanation of the business grounds on which he has based his decision and the appeal meeting should have provided adequate opportunity to make clear to the employee the facts on which the employer based his decision. To subject any of these facts to further tests would be unnecessary. How can any of these facts not be material to the decision or substantial to the basis for the decision?
This new right of flexibility will encourage both parties to consider flexible working patterns that suit them both. The mechanism provided here will enable employers and parents to begin to explore solutions together. The approach is based on existing best
practice, promotes dialogue throughout the process, and encourages both parties to think about alternative solutions. They will contribute to increased productivity and help to make working parents' lives easier and benefit their children.
In the light of the background and explanations that I have provided to the areas where amendments have been tabled, I ask the noble Baroness to withdraw the amendment.
Next Section
Back to Table of Contents
Lords Hansard Home Page