The small business guide to flexible working changes

New Government plans have announced that flexible working will be considered ‘default’ with new starters being able to request it from day one of employment.

The results of this could have big impacts for the millions of small businesses in the UK, with Government announcing that this should lead to higher productivity and staff retention as a result. But what does this mean for your small business and how will you really be affected?

What is flexible working and what are the current laws?

Flexible working is a term used to cover lots of different working arrangements. Some common examples include working from home all or part of the time (commonly known as hybrid working), changes to start, finish or lunch times, or even reduced hours.

As the law currently stands, employees who have been with their current employer for at least 26 weeks can make one request for flexible working in any 12-month period. Then, as their employer, you would need to decide whether to grant or reject this request within three months.

However, it’s important to understand that there are only eight reasons that you are legally allowed to reject and currently, employees need to explain what they think the employer might do to overcome any difficulties the request might cause. These reasons are:

• The burden of additional costs
• Detrimental effect on the ability to meet customer demand
• Inability to re-organise work among existing staff
• Inability to recruit additional staff
• Detrimental impact on quality
• Detrimental impact on performance
• Insufficiency of work during the periods the employee proposes to work
• Planned structural changes.

Important note: If you grant the request, it makes a permanent change to the employee’s contract, and a contract addendum will need to be provided.

What’s changing?

The key point that’s changing is timing. Currently, as an employee, you can only request flexible working after 26 weeks of service, however, this will change to a right from ‘day one’. That means, on the first day of employment an employee has the right to put in a request.

In addition, there are a few other changes that the government is intending to make to the flexible working laws:

• Introducing a requirement to consult with employees before declining a flexible working request
• Employees will be allowed to make two requests in a 12-month period, instead of just one
• Employees no longer need to explain how they expect their employer might deal with any difficulties caused by the request
• Employers will only have two months to respond to any requests

When will this happen?

No date has been set for the new law to be implemented as it is still going through Parliament, but it is expected to come into force in early 2023.

What does this really mean for my small business?

While many businesses have already adopted a flexible, or hybrid, way of working, there are many that may not have had the capacity or infrastructure to do so. This may still be the case, and if requests are made, you are still able to reject them for one of the set reasons.

There are no requirements for you to offer flexible working during the recruitment process, but the pitfall is that you may receive a request on the first day of a new starter’s employment. It is important to remember that you cannot treat a new starter in any different way than you would have if they had not made a request – they will have the same rights for flexible working requests as your long-term employees.

Top tip: We suggest answering any flexible working questions during interview stage to understand any queries your applicants may have.

Lots of small businesses have found flexible working very positive, especially in recent years, as it has encouraged open discussions with staff and employers – who still have the right to say no, if required – and has shown to increase productivity.

Because this will be a legal amendment, rather than a complete change, it’s useful to look at this as an evolution. While it allows your people to make more requests and do them sooner, it doesn’t have to negatively impact your business.

One of the worries small businesses might have is that job offers may be made in good faith, and then immediate requests to change could be made to adjust working hours or not work certain days, and you will be required to consider and discuss them. A reduction in hours may be the most detrimental to small businesses, so think about any ways to overcome this and whether the role can be done in less time. This can be a difficult start to a new employment relationship, but if handled fairly and carefully, shouldn’t be harmful long-term.

If you’re unsure about how to manage this going forward or have any concerns around editing employment contracts to reflect any changes, citrus HR have a strong team of HR experts and employment law specialists on hand to advise and guide you. Find out more about our affordable HR support today.