Memorandum by the Chartered Institute
of Personnel and Development (CIPD)
1. Since the introduction of the working
time regulations in 1997, the Institute has been concerned to
track their impact in the workplace. We have undertaken surveys
of employer and employee attitudes towards working time and published
reports of the findings. In this note we offer a summary of the
main findings from our research that are relevant to the Sub-Committee's
inquiry, drawing where necessary on other research for comparison.
THE IMPACT
OF LONG
HOURS WORKING
2. CIPD commissioned Taylor Nelson Sofres
to undertake a survey amongst a representative sample of the GB
working population, with a particular emphasis on those working
48 hours or more per week. The findings were published as "Living
to Work" (September 2003). The survey objectives were to
assess people's attitudes towards their working life and ascertain
what impact, if any, work was having on other aspects of their
life.
3. A summary of the main findings from the
survey is attached. The key conclusions were:
— One in four of all workers claimed
to work more than 48 hours a week in 2003, compared to only 10
per cent in 1998. However the number of hours worked on average
by people working more than 48 hours a week declined marginally
from 58 hours a week to 57.4 hours.
— The main reason for working long
hours was workload (cited by two out of five long hours workers).
However one in two workers said that working longer hours is "totally
[their] own choice—doesn't mind working long hours"—up
from two out of five respondents saying the same thing in 1998.
— Long hours working was reported to
have had some sort of negative impact on health (by more than
one in four respondents) and relationships (more than two out
of five). Most respondents reported negative effects on their
job performance.
— Despite working over 48 hours a week
almost half (47 per cent) of respondents believed they had struck
the right balance between work and life outside work.
4. A major review for the Health and Safety
Executive (HSE) in 2003 of the literature on the relationship
between long hours working and health concluded that "There
is some evidence that working long hours can lead to stress or
mental ill-health, although this is somewhat equivocal. The way
an individual thinks about their job and the amount of control
they have over their job will mediate this relationship".
More generally, the effects of working long hours are found to
be mediated by:
— individual factors (gender, age,
personality);
— choice and control over work hours
and rest breaks;
— type of job/occupation/task;
— type of work environment or culture.
5. A report by Professor David Guest on
"Pressure at work and the psychological contract" (CIPD
2002) also examined the impact of a range of factors on employee
perceptions of their health and daily well-being (see table 18
attached). The report commented that ". . . although working
longer hours may be harmful to health, the social support received
by those working long hours and their control over their work
have a positive effect, mitigating some of the negative effects".
The critical importance of control is underlined by a report for
HSE by the Institute for Employment Studies in 2002, which found
that high workload was associated with poor well-being only under
conditions of low control. Successive annual surveys by CIPD of
employee attitudes confirm that HR practices generally, but particularly
those relating to the delivery of promises, trust and fairness,
are critical to a positive psychological contract and these practices
will also mediate the way in which working long hours affects
individuals.
6. CIPD believes that employers have a responsibility
to ensure employees are aware of the possible negative effects
of persistent long hours working. However the evidence suggests
that the relationship between long hours working and ill-health
is not entirely straightforward. The voluntary nature of much
long hours working raises issues about freedom of choice and underlines
the resistance that might be anticipated from both employers and
employees to any proposal to tighten existing statutory controls.
Policy efforts to reduce long hours need to take account of a
wide range of factors, including issues about collective bargaining
and low pay.
EVIDENCE ON
THE USE
OF THE
OPT-OUT
7. In January 2003 a survey of more than
750 HR professionals by the Employment Lawyers Association and
Personnel Today magazine was published revealing how employers
in the UK use the opt-out. The survey also asked the respondents
about the effect removal of the opt-out would have on their businesses.
8. The key findings are outlined below:
— 65 per cent of organisations contributing
to the survey are actively using the opt-out clause. 61 per cent
of organisations where no employees have signed an opt-out nevertheless
believe the UK opt-out should continue;
— the proportion of employees opting
out within organisations varies greatly. In 28 per cent of organisations
all employees have signed the opt-out, while in 18 per cent of
organisations fewer than 10 per cent of the workforce has signed
the opt-out;
— 56 per cent of organisations using
the clause report that no employees declined to sign the agreement.
In organisations where employees have declined, 83 per cent report
fewer than 10 per cent of their workforce have declined.
WHAT IMPACT
DO EMPLOYERS
ANTICIPATE IF
THE OPT-OUT
WERE TO
BE REMOVED?
9. The report finds that there is strong
support among employers for keeping the opt-out, with 78 per cent
of respondents holding this opinion. Some sectors showed almost
total commitment to retaining the opt-out: in catering, for example,
96 per cent of organisations suggested the opt-out should stay,
while in construction the figure was 94 per cent and in transport
86 per cent.
10. In terms of its impact on their business,
employer responses were as follows:
— Health & Safety: Almost two-thirds
of organisations do not believe that removing the opt-out would
improve health and safety in the workplace: improving the health
and safety of the workforce was a primary aim of the legislation
but 64 per cent of organisations say that removing the opt-out
would have no such effect. Of those who do believe ending the
opt-out would have an effect, 22 per cent believe it would improve
health and safety while 14 per cent think the effect will be adverse.
— Sickness, absenteeism and cover:
66 per cent of organisations forecast no effect on sickness and
absenteeism levels while 78 per cent predict an adverse effect
on the management of holiday and sickness cover if the opt-out
is removed. Not only do employers see the removal of the opt-out
as irrelevant to improving the health of their workers, they believe
it would leave them less able to cope with the absences they have.
— Overall efficiency: 80 per cent of
organisations believe that without the opt-out their overall level
of efficiency will suffer. Particularly high figures are for the
transport sector at 94 per cent, catering at 92 per cent and the
construction and energy sectors at 90 per cent.
— Staff turnover: 47 per cent anticipate
staff turnover will be adversely affected. Here, the energy sector
and transport were most pessimistic with 70 per cent and 73 per
cent respectively forecasting bad news in the wake of the opt-out's
removal. The adverse effect on staff turnover would be felt more
keenly by large organisations: 60 per cent of respondents employing
more than 50,000 workers say the end of the opt-out would have
an adverse effect on staff turnover.
— Moonlighting: 46 per cent of respondents
predict an adverse effect on moonlighting. By removing the ability
to work extra hours for extra money, some employers argue their
employees will find second jobs to make up their income shortfall.
67 per cent of retail organisations and 64 per cent of transport
organisation expect this to be a problem. Half of all education
sector organisations agree.
— Agency staff costs: 74 per cent of
respondents express fears that removal of the opt-out would increase
the cost of agency staff for employers. This is a widespread fear
but highest in the construction sector (95 per cent) and in hospitals
(92 per cent). This issue is also of great concern in catering
and manufacturing where 77 per cent of respondents believed their
agency costs would rise.
— Staff rostering: 78 per cent of respondents
are worried that full implementation of the Directive would adversely
affect staff rostering. Every organisation in the local government
and education sectors believes there will be negative effects
on staff rostering as a result of losing the opt-out. 96 per cent
of hospital and catering organisations also believe the effect
of the move will be negative.
— Seasonal demand: 69 per cent of all
organisations say losing the opt-out would have an adverse effect
on managing seasonal demand in their industry. These figures are
highest in the transport, construction and catering sectors at
88 per cent, 81 per cent and 85 per cent respectively.
WHAT DO
UK EMPLOYERS WANT?
11. The survey asked what employers thought
should be done in relation to the Working Time Regulations:
— 80 per cent of organisations want
the opt-out to be retained, but if it goes, most would—as
a concession—want the period over which working hours are
averaged to be set at 52 weeks, rather than the proposed 17 weeks.
72 per cent of respondents supported averaging over 52 weeks,
18 per cent disagreed and 10 per cent had no opinion.
— Employers also want more clarity
over the definition of working time. 83 per cent of all respondents
agreed more attention should be given to this issue with only
12 per cent disagreeing and 5 per cent expressing no opinion.
Interestingly, while the retail and IT sectors led the way in
this view—92 per cent and 91 per cent respectively—central
and local government respondents also thought the definition of
working time needed attention—recording 80 per cent for
central government and 79 per cent for its local counterpart.
— 71 per cent of all organisations
believe there should be a simpler mechanism available for making
workforce agreements. The need for less bureaucracy is particularly
acute in the IT sector—89 per cent—but it is interesting
to note that even voluntary sector organisations regard this as
a significant problem with 70 per cent calling for a new system.
12. Currently the reference period for calculating
the 48 hours may only be extended beyond 17 weeks by collective
agreement or other agreements concluded between the social partners.
This puts the UK at a disadvantage because according to figures
cited by the European Commission a very small proportion of workplaces
in this country are covered by collective agreements compared
to other EU nations. Only 36 per cent of workforces in this country
are covered by collective agreements and just 22 per cent if only
the private sector is taken into account. CIPD suggests that the
period over which working time is averaged should be set at 52
weeks, without the need for specific agreement.
WORK LIFE
BALANCE
13. In mid-2003, CIPD in conjunction with
law firm Lovells carried out a survey of 500 HR professionals
to find out the impact of legislation giving parents with young
children the right to request flexible working arrangements. The
key findings are:
— More than a quarter of employers
have seen an increase in the total number of requests for flexible
working since the right was introduced in April 2003.
— Of those organisations that have
received statutory requests, nearly two thirds (62 per cent) have
approved at least half of all such requests, either in the form
submitted by the employee or in modified form.
— A large majority of employers (91
per cent) say they are already prepared to consider requests for
flexible working from employees who are not entitled to the statutory
right.
— 72 per cent of employers are prepared
to accept requests from all staff. The majority of employers think
that the opportunity to work flexibly has had a positive effect
on employee attitudes and morale.
— It is not just clerical workers (at
44 per cent of employers) who are exercising their right to ask
for flexible working. Managers (21 per cent), technical staff
(20 per cent) and professionals (27 per cent) are also taking
up their rights.
— Just under half (49 per cent) of
all employers say that they intend to expand, at some point, the
groups of eligible employees who will be considered for flexible
working.
— Nearly all employers who have no
plans to expand the eligibility criteria of their flexible working
policy already offer an arrangement which is more generous than
the statutory right.
14. The survey suggests that employers are
responding positively to requests for flexible working and sympathetic
to concerns about work-life balance. Labour market, demographic
and social trends (see attached) will mean employers are under
continuing pressure to move away from long hours working. UK organisations
will need to become "employers of choice" and consider
the work-life balance of their staff if they want to compete.
15. The evidence from the "Living to
Work" survey underlines that there needs to be a clear distinction
between policies aimed at reducing long hours and those aimed
at improving employees' work life balance. Half of those working
more than 48 hours a week believe that they have got the right
balance.
CONCLUSIONS
16. Research findings suggest that a large
proportion of UK employers currently use the opt-out to help manage
working time and avoid unnecessary bureaucracy. Many believe they
would suffer significant damage to their business if the opt-out
were removed. Almost four out of five of employers in the ELA/PT
survey want to keep the opt-out.
17. Resistance to removing the opt-out is
not limited to employers. Many employees working long hours do
so voluntarily and would not wish to be required to reduce their
hours. Those who are working overtime in order to boost their
earnings would similarly be unhappy to be told that it would no
longer be lawful to do so. There would be pressure for increased
pay rates and more double-jobbing, where enforcement would be
largely ineffective.
18. There is evidence that many employees
have some choice whether they sign the opt-out, with 36 per cent
of employers using the opt-out claiming that some staff had chosen
not to sign. CIPD believes it should be possible to strengthen
the arrangements for opting out in order to ensure that where
an opt-out agreement is signed it genuinely reflects the employee's
wishes.
23 February 2004
| 
