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Employment Law

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Introduction

This report will outline key arguments surrounding contemporary debates on UK employment law, which will provide a critical analysis from those that argue there is too much legislation and those that suggest there is not enough. It is beyond the scope of this report to generalise on employment law as a whole; it will therefore focus on the right to request flexible working, such as under the Employment Act 2002 and The Work and Families Act 2006 that has been subject to various reforms, amendments and regulations. This legislation has formed a significant debate as to whether such interventions ensure that individuals achieve a work-life balance, promote efficient working practice or create an unnecessary burden on UK businesses (Chartered Institute of Personal Development (CIPD), 2005, British Chambers of Commerce (BCC), 2010).

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This analysis will also look at the introduction of new employment legislation for flexible working, and discuss the impact on working practices today, with a glance toward the shape of new legislation in the future (Chartered Management Institute (CMI),2008).

Findings

Background and Context

The last three decades have seen a trend toward increasing employment legislation. At the same time the United Kingdom (UK) still has lower levels of employment protection and more labour market flexibility than other European states (Keter, 2010). The flexible market in the UK was inherited through the general laissez-faire attitude, where industrial labour and relation laws have been less state regulated than other European countries (Biagi, 2000). Keter (2010) suggests that today’s flexible market is also the result of more recent trends, which from 1979 saw the introduction of more labour regulations in terms of statutes enacted, but with the aim of setting labour free of interference from state control and what was seen as unnecessary social partners, such as trade unions (ibid).
The introduction of a New Labour administration however saw a shift toward more family friendly employment legislation. A European directive from 1997 (European Council Directives 97/81/EC and 98/81/EC) provided that part-time workers be entitled to the same rights as comparable to full-time employees. The directives required European member states to implement laws, regulations and provisions to eliminate discrimination against part-time workers. The aim was to facilitate the development of part-time and other working time arrangements, that were flexible and met the needs of both employers and employees (Danzinger & Waters Boots, 2008).

In order to promote citizens full participation in the labour market, the enactment of The Employment Relations Act 1999, while continuing to ensure that labour relations were free of state control, provided a floor of rights, such as increased rights for fixed and part time workers, (Biagi, 2000). Along this trajectory, the Employment Act 2002 introduced legislation providing employees with young or disabled children the right to request flexible working arrangements by their employers, that was subsequently extended in The Work and Families Act 2006 to allow the same rights for carers of adults (Davies, 2011). Lewis and Campbell (2007) suggest that New Labour’s concern with promoting a ‘work-life’ balance underpinned it’s ideological approach to welfare, that saw active citizenship for all achieved principally through labour market participation (Levitas,2005). For all to participate, legislation has provided for the extension of childcare services and maternity leave and the introduction of parental and paternity leave. Further, rather than reducing working hours, the Labour government promoted the right to request flexible working hours as a way for families to manage their working patterns with their caring responsibility timetables (Busby and James, 2011).

Hill et al (2001) describe flexible working to include activities such as; part-time, job sharing and homeworking or any variation outside of working the traditional nine until five working day. For example, working from home, where such practices are facilitated due to advances in mobile technologies (Civicus, 2008). Lewis & Cooper (2005) argue that although in principle flexible working can take many forms, in reality, the main flexibility that UK employers offer is a reduction of working hours.

From an employer’s perspective, employment legislation can also be seen as promoting the creation of work patterns and arrangements in order to maximise employment productivity, customer satisfaction and staff efficiency (Pettinger, 1998). This demand, Pettinger suggests, has come about as a result of the expansion of global markets, competition and choice, pressures on resources and increasing customer demands, together with changing patterns of consumption (ibid). Therefore, Pettinger (1998) suggests that against this backdrop, flexibility can be seen as a corporate attitude, whereby a fully flexible labour market is seen as generating a more effective workforce.

Faulkener (2001) argues that while it is recognised that it is the above drivers that have influenced the development of flexible working practices, there is also another important agenda. Here, Jones and Jones (2011) identify that family friendly legislation is more representative of the ‘business case’ for flexible working legislation, which revolves around the identification of recruitment pools, particularly women, and the older population, who have yet to be fully exploited (Faulkener, 2001, Jones & Jones,2011).

Arguments Against more Employment Legislation

According to a British Chambers of Commerce (BCC) (2010) report on employment regulation, a survey of British businesses see an emerging consensus that the proliferation of legislation providing flexible working conditions has become increasingly problematic. The report argues that the shift from the regulation of collective bargaining to individual employment contracts, later evolving into the volume and complexity of statutory legislation today, has led to difficulties with understanding and compliance (ibid). The report specifically attacks the piecemeal legislative approach to flexible working shown by the latest introduction of laws and regulations (see Appendix 1)
According to the BCC (2010), such an approach has been criticised by businesses. The problem for companies is that constant changes in the law mean that employers must incur the cost of familiarising themselves as each new law is enacted, where there is a greater risk of mistakes. As a result, businesses need to bring their knowledge up to date since the previous change in the law, such as through employment law books and guides or paying for legal advice. Consequently, the report argues, employment legislation can act like a tax, by raising costs (ibid). The Department of Trade and Industry (DTI) (2006) argue further that even if there is a belief that the increase of employment law can improve the flexibility of the labour market, there are still questions as to whether such legislation is fit for purpose. Against a backdrop of increasing employment legislation, a National Audit Office (2009) research paper also casts doubt over whether governments are able to understand business enough to design effective legislation. The BCC (2010), representing one hundred thousand businesses, suggest that due to the volume and complexity of employment legislation, in particular small and medium-sized enterprises (SMEs), now need professional legal advice to settle disputes. In reality, the BCC argue, it is less expensive to settle disputes with the employee and prevent reputational damage than it is to defend a claim. The BCC therefore recommends streamlining and reducing the amount of legislation, for example, in a similar way that the anti-discrimination laws became consolidated by the Equality Act 2010 (ibid, 2010).
Despite such criticisms, not all the findings in the business sector are negative. According to a Chartered Institute of Personal Development (CIPD) Survey Report (2005), who surveyed Human Resources professionals from over six hundred companies, the majority saw employment law as making a positive contribution to their businesses. This research suggested that the main barrier to effective implementation of employment law is the perception that there is too much employment legislation (ibid). In response, the Annual Employment Law Review by the Department for Business Innovation and Skills (BIS) (2012) aims to tackle perceptions that there are ‘too many’ employment laws, through lobbying for reform, while ensuring that reforms are not at the expense of compromising fairness for individuals. The report argues that although businesses complain about the amount of employment legislation, in reality the UK has one of the most lightly-regulated labour markets among developed countries. Only the United States and Canada have lighter overall employment regulation (OECD Indicators of Employment Protection, 2008: cit in: BIS, 2012).

Arguments in favour of more Employment Legislation

The UK’s ‘light touch’ employment regulations may be reflected in their flexible working legislation. The right to request flexible working does not enforce employers to comply with individual requests, only to offer the procedures for them to do so. It is therefore argued that it is individuals (particularly with dependents) and the social organisations who support them, who favour increasing employment legislation, in order to provide fairness at work that ensures a work life balance (Burnett et al, 2012). In a 2012 report by Working Families and One Plus One, Happy Homes and Productive Workplaces, from a sample of over two thousand respondents, nearly eighty percent of respondents felt that flexible working was the most beneficial working arrangement (Burnett et al, 2012). However, the report argued that in order to support flexible working, further legislation was needed in order to promote arrangements that are mutually beneficial and embedded as a culture of flexibility, rather than an approach that manages requests as an exception to the norm (ibid). Along with relationship and family support organisations, a growing number of business and HR associations support further employment legislation and reform to push forward the benefits of flexible working (CIPD, 2013). Drawing on the findings of the 2011 Workplace Employment Relations Study (WERS) the CIPD suggest that employment legislation needs to increase, due in part to a lack of effective mechanisms to tackle labour relations. The report points to recent socio-economic and political changes in the UK where an increase in employment law is becoming ever more essential. For example, the facilitation of employment legislation during the 1980’s and 1990’s discouraged union membership and reduced collective bargaining powers. This is reflected in the WERS study, in 2012, which shows very low levels of employee engagement in collective bargaining, only six percent in private businesses, with fourteen percent of employee trade union membership in the same sector (Wanrooy et al, 2011). The near absence of collective bargaining, although removing employer constraints on freedom of action, raises concerns over employee voice, where employment legislation may be seen as an attempt to close this gap (CIPD, 2012).

Danzinger and Waters Boots (2008), argue that in reality flexible working legislation does not go far enough. Unions and parent advocacy groups argue that many workers who would benefit from flexible arrangements do not ask for them out of fear of being refused, or because of a fear that asking may jeopardise their careers. Research suggests that employees will only ask for flexible work if they believe their requests will be approved. It is also argued that flexible working legislation may reinforce gender inequalities by linking flexible work and care responsibilities, reinforcing a ‘mother career track’ that pairs women with demotions of pay and position. Further, unfair dismissal claims, involving refusal of flexible working, tend to favour women, who can rely on anti-discrimination legislation, such as in Adedeji v The City of London Corporation (2007) (see Appendix 2), in order to strengthen their claims (ibid).

Future Changes to Flexible Working Legislation

New flexible working employment legislation to come into effect in 2014 appears to address some of the above criticisms. The government plans to extend the statutory right to request flexible working arrangements to all employees (with over twenty-six weeks service) whether they are a carer or not. This removes the present requirement that the employee must have caring responsibilities. In addition, the procedure for considering flexible working requests, which is currently very prescriptive, will be relaxed and employers will instead be required to consider requests in a ‘reasonable’ manner and within a ‘reasonable’ time frame (ACAS, 2014).

Currently, it is possible for an employee to claim compensation due to the employer’s failure to comply with the procedures laid down in the Flexible Working (Procedural Requirements) Regulations 2002. In Bryan v Corporate Advertising Ltd ET/2105111/10, although the tribunal rejected Mrs Bryan’s claim that she was constructively dismissed and subjected to indirect sex discrimination, it was however held that the company had breached the procedures laid down by the 2002 Regulations. This procedural breach may no longer by relied upon under the 2014 legislation. However, successful claims may still be used under anti-discrimination legislation. In Commotion Ltd v Rutty [2006] IRLR 171 (EAT), it was upheld that the employee had been subject to constructive unfair dismissal and indirect sex discrimination, due to the employer’s failure to have any lawful reason to reject flexible working conditions. However, in Winfindale v Debenhams Retail plc (ET/2404134/10, 20 Aug 2010), it was held that there was no indirect sex discrimination where an employer showed that they took seriously a request to return from maternity leave on a part-time basis to a manager’s role. According to a Equality and Human Rights Commission report (2009), proposed changes in flexible working legislation will continue to fail to encourage workers in management positions to request flexible arrangements (EHRC, 2009). The report suggests that under current legislation, employee’s in management positions are less likely to make a request for flexible working, and when they do, they are less likely to succeed (ibid).

In the government’s Consultation on Modern Workplaces Report (2012), it is argued that current legislation that prioritises certain groups reinforces the idea that flexible working is only for those in caring roles, whereas the aim of the new legislation is to promote a culture where flexible working is a legitimate ambition for all employees (HM Government, 2009). Although the legislation proposes to ‘allow’ but not ‘require’ employers to prioritise competing requests, employers will continue to have to show that all competing requests cannot always be accommodated, in their entirety, on business grounds (ibid).

Drawing on the CIPD report (2005), a large majority of employers find compliance with the current legislation relatively straightforward. Of those who have had problems, the main barrier to compliance is that managers find it difficult to manage employees on different flexible working arrangements. Given that the new legislation attempts to widen the right to request flexible working to all employees, employers may face an increased challenge to accommodate competing requests. However, according to the same report, since the introduction of the current legislation, less than one-tenth of employers have faced grievance or disciplinary proceedings, or an employment tribunal claim. Further, research shows that it is large multi-national companies that benefit most from flexible working arrangements. Among those benefits are improvements in staff retention, improved morale and a reduction in costs (CIPD, 2005). These reported benefits need to be balanced against arguments that oppose more legislation promoting flexible working (ibid).

More significantly, the statutory provision to enable greater flexibility in the workplace looks set to increase in the future. In a recent report, Management Futures – The World in 2018 (2008), the findings predict that organisations will become more virtual, the premium for talent will increase, with new aspirations and ambitions of a multi-cultural, widely dispersed workforce (Chartered Management Institute (CMI),2008).

Conclusion

This report has attempted to provide an insight into the contextual background surrounding employment laws in the UK today. The focus on flexible working legislation may be seen as a salient debate, given the competing claims from employers, employees and the organisations that support them (Burnett et al, 2012). At the same time, against a backdrop of socio-political and economic changes there has been an increasing legislative response to address both the rights of individual workers and a drive to improve competition, efficiency and development in the market (Pettinger, 1998). Given the predictions of further changes in the labour market, statutory provision looks set to increase in response. The debate for or against increasing legislation surrounding flexible working therefore needs to be balanced with the benefit to both businesses and the rights of individuals (CIPD, 2005).

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