In the wake of the coronavirus pandemic, we have continued to see a tussle between employers wanting a return to the office and employees wanting to retain flexibility and a greater autonomy over their working arrangements. As many employers continue to push for greater office attendance, in some cases employees have responded with making a formal flexible working request. Many of these inevitably focus on remote working.

However, we have also spotted a recent trend of more creative requests. Not only are employees making requests for remote working and part time working, but the cost-of-living crisis also means employees are increasingly focused on how they can achieve a better work life balance, whilst protecting their income. For some, working compressed hours is the answer.

What is a compressed work week?

A compressed hours arrangement allows employees to work their full contractual hours over fewer working days. For an employee who is contracted to work 40 hours a week, Monday to Friday, examples of a compressed hours working week might include working:

• ten-hours for four days per week (e.g. 8am to 7pm, with an hour for lunch);
• a 9-day fortnight, working their full contracted hours over 9 days in each two-week period (equating to just under 9 working hours a day); or
• an extra hour Monday to Thursday, to allow for an early Friday finish.

Employees could also work a combination of compressed hours and part time working. For example, an employee could work one long 10-hour day, and two shorter five-hour days.

These types of working arrangement will appeal to many; the employee will get to retain their full-time pay and benefits, but they gain an additional day or afternoon off.

What are the benefits of compressed hours?

The benefits of compressed hour working arrangements are not just for employees. Benefits for employers include:

• Competitive advantage: Allowing a variety of flexible working patterns tailored to each individual throughout their career will give employers a competitive advantage, allowing them to retain the best talent. For example, allowing such requests could be a helpful tool in supporting parents returning from a period of family leave. The right to request flexible working is now a ‘day 1’ right and allowing an employee to work a pattern which suits their lifestyle from the outset of employment may also help attract the best talent.
• Operational flexibility: Depending on the industry and role, in some circumstances compressed hours could allow the business to extend their operating hours to clients or for client-facing work to be given greater priority during usual operating hours.
• Improved employee well-being: There is a lot of evidence around the benefits of a four-day week for both employers and employees Although a lot of this is based on 4 day working trials focusing on reduced hours (as opposed to compressed hours) there is still an argument that working fewer days will generally allow employees to obtain a better work life balance. In turn, this could prevent burnout and stress, improving wellbeing and reducing sick days.

Are there any drawbacks?

There are also some down-sides for employers:

• Hard to implement: For some sectors, compressed hours will be difficult to implement in practice and, in some businesses, unviable. For example, in hospitality or manufacturing where a shift rota is operated, employees may already be working long shifts or deviations from usual shift rosters may not be logistically possible.
• Difficulty determining what is “full time”: In many industries, employees will regularly work significantly more than their contractual hours. This is very common, for example, in professional services. Contracts of employment in many industries require employees, and particularly managers, to work additional hours as may be required to fulfil their role without further remuneration. This is often combined with the employees signing an opt out of the 48-hour working week. This is the real nub of the problem for many employers who receive this type of flexible working request. How can these employers determine what “full time” hours actually are in practice? And where an employee habitually works, and is expected to work, unpaid overtime to fulfil their role, is it feasible or practical to agree to even longer working days?
• Impact on team morale: This type of working arrangement can cause friction amongst staff. Agreeing to compressed hours working for one employee could result in them actually doing fewer hours than they otherwise would have if working five days a week, whilst also upsetting employees who regularly work beyond their contractual hours five days a week.
• Too demanding: As a counter argument to the benefits above, working longer days could actually be a source of fatigue, stress and, ultimately, burnout. A working pattern which exceeds the usual hours in a working day can be physically and/or mentally draining and have a negative impact on wellbeing. Depending on the nature of the work, there may also be health and safety concerns (a point which is considered further below).

What do we need to consider if agreeing to a compressed working arrangement?

If an employer agrees to an arrangement to work compressed hours, they will need to consider the wider contractual and practical implications. For example:

• How will holiday be calculated? Most workers are entitled to a minimum of 5.6. weeks’ annual leave. As holiday entitlement is calculated with reference to a “week”, for an employee who works full time hours over fewer days, this will equate to fewer days of holiday (despite working the same number of hours). But this does not always translate to a straightforward answer for how holiday and bank holiday entitlement should be calculated. The answer will vary depending on the specific working arrangement and contractual terms. For those that work a pattern with some working days longer than others, it may be appropriate to calculate entitlement in hours. This is a tricky area and specialist advice should be sought.
• Are there any health and safety concerns with working longer hours? For most requests, there is unlikely to be a breach of the Working Time Regulations. Having said that, if an employee is working longer days, employers should be mindful employees still receive:

• A daily uninterrupted rest period of 11 hours; and
• A rest break of 20 minutes if the employee’s working time is more than 6 hours a day.

In addition, employers have a duty to protect employees’ health and safety and should consider if an employee is generally receiving regular breaks. In some industries, employers should also consider carrying out a risk assessment for such working patterns, particularly if the role involves an element of manual or monotonous work.

• Is there sufficient work that can be completed outside of normal operational hours? If so, will the employee still require supervision and how will this be sought if the rest of the team won’t be around?
• If an employee will be working longer hours than others, will their attendance be monitored or tracked in any way to ensure they are completing their hours?
• How will the new working arrangements be communicated to the rest of the team? Could this cause an influx of similar requests? If so, how will you manage these? The flexible working legislation does not deal with how to handle competing requests, but in practice this can be difficult to manage. Transparency and open communication will be key. Generally speaking, each request should be considered in the order received and employers should follow the same procedure for each. Discussions with the impacted employees will be important, as well as considering possible compromises.

Before agreeing to a request, employers may want to consider the use of a trial period. The Acas Code of Practice suggests a trial period may be appropriate to assess the feasibility of an arrangement and a trial period will allow both parties to test the proposed working arrangement before committing to it permanently. If both parties agree to a trial period, employers should consider extending the statutory 2-month decision period and ensuring time is allowed for both the trial and any subsequent appeal. Employers will need to ensure that any trial period is carefully communicated and specialist advice should be sought.

Can we say no to a request to work compressed hours?

There are eight statutory reasons an employer can rely on to reject a flexible working request. These reasons are fairly wide-ranging, and each request should be considered based on individual circumstances. However, although many employers can feel hesitant to agree to such working requests because of the drawbacks noted above, it may not be easy to shoehorn a genuine business reason into one of the statutory grounds when refusing a compressed hours request. Possible statutory grounds to consider are:

• A detrimental impact on performance and/or quality. There is a risk that working, for example, 4 longer days only could mean an employee will struggle to fulfil all the requirements of their role. This could include an ability to realistically be able to meet full-time targets. This may be of most concern for roles or industries where employees are regularly required to work above their contracted hours to fulfil their role.

There may also be an argument that working longer hours will reduce focus and effectiveness, leading to a detrimental impact on output. This may be difficult for employers to be able to establish, particularly if the request only includes one or two longer working days.

These can be sensitive arguments for employers to run without any objective evidence. Although an employee cannot insist on a trial period to test the arrangements, an employer may need to consider one and justify any decision not to trial the arrangements. Any trial period would not test any longer-term implications (such as the likelihood of fatigue or burnout), but it could allow an employee to show that their requested arrangement can be well managed. It will be important for employers to properly consider, investigate and ideally evidence that performance or quality could be impacted to avoid an employee successfully arguing a decision was based on incorrect facts (see more about this risk below).

• An inability to re-organise work among existing staff. If an employee can only do limited tasks outside of usual hours this could limit productivity and lead to others in the team having to take on additional work. Alternatively, as with other part time requests, a request may result in insufficient staffing on certain days, such as a need for a certain number of managers each day. However, this ground will be less relevant to larger businesses or “stand-alone” roles or for employees who generally manage their own client base and workload.
• A detrimental effect on the ability to meet customer demand. This can be relevant if a large part of a role requires client contact during “normal” working hours. An employer will have even stronger arguments if urgent client support is often required.
• Insufficient work available during the periods the employee proposes to work. This may be easier to establish for customer-facing roles. For example, if a sales adviser works on a helpline, there will likely be little value in them working after the helpline is closed. Other examples could include creative roles where collaboration is a core part of the role and the ability to do this outside of usual hours is limited.

An employer can rely on other reasons for refusal, such as health and safety concerns, but these will fall outside the flexible working regime and therefore carry risk (see below).

What process do we need to follow if we receive such a request?

Although employers are not obliged to accept a request, they do need to follow a fair process. See our flowchart for the new flexible working requirements. The revised Acas Code of Practice is clear that before rejecting any request, employers must consult with the employee and consider alternative flexible working options, such as other part time working arrangements.

Changes to the flexible working regime have reduced the time frame an employer needs to respond to a request from 3 months to 2 months, including time for any appeal (although this can be extended with agreement). So employers will need to act swiftly and in line with their own internal flexible working policy.

What are the risks of refusing a request or not following any process?

Employees can bring a number of flexible working claims. For example, on the basis that the employer:

• failed to deal with an application reasonably;
• rejected an application for a reason other than one of the statutory grounds; or
• based their decision on incorrect facts.

Any claim must usually be brought within 3 months of either the employee being told of the decision or the statutory decision period (or any agreed extension) coming to an end.

The flexible working regime arguably lacks real teeth. Financial liability is relatively low; a maximum of eight weeks’ pay (which is also subject to the statutory weekly pay cap). However, there is also the risk of successful discrimination claims (particularly indirect discrimination claims). For example, if it can be shown that women are more likely to be disadvantaged by a policy of not allowing compressed hours working arrangements, an employer will need to objectively justify any such practice.

Aside from the legal risks, there are obvious employee relations concerns with rejecting any flexible working request. Rejecting a request could result in disgruntled and unmotivated employees, which could lead to grievances or resignations, as well as impacting team morale.

In light of the concerns highlighted above, employers can be tempted to have a blanket policy approach to refuse all compressed hour arrangements. As with any flexible working request, we would urge employees to consider each request on a case-by-case basis.
If you require support responding to a request to work compressed hours, please get in touch with your usual Lewis Silkin adviser.