It’s almost Autumn in the UK. In 2022, the new season looks set to be a season of change for many employees. The usual September shifts are coming up: children are going back to school leaving their parents with different commitments; some employees are starting or continuing university studies. Some employees are reassessing their employment situations to ensure they’re earning enough to support themselves through the cost of living crisis and imminent winter energy bill rises. Lots of business owners are also considering how they can adapt to the economic downturn and growing costs (eg energy and wage costs).
Making changes to employees’ working arrangements can provide a solution to these challenges for employers and employees alike. Altering employment terms is a great way for employers to navigate issues without having to make dismissals or redundancies. Moreover, it can often be done in collaboration with employees, to both sides’ benefit. Some things that you can do to change working arrangements are:
Change employment terms
All employees have an Employment contract with their employer, whether written down or not. This is a legally binding contract that generally cannot be changed by either party without the other’s agreement.
If an employer and employee agree on a change (eg a reduction in salary in exchange for different working hours), this can be introduced as an alteration to the employment contract. Such changes can be made verbally, but it’s good practice to record them in writing in case a disagreement arises later and you need proof that a change was agreed to. If you want an employee to agree to a change that they don’t want, such as working fewer hours or taking on extra tasks, you should consider offering something in exchange. For example, enhanced pay or benefits.
Employers can sometimes make changes to employment terms without an employee’s permission, if this is allowed in the employee’s employment contract. Such clauses will usually only allow unilateral changes to minor things like hybrid working requirements or bonuses.
Creating a Change to employment terms letter is a good way to communicate clearly with an employee, whether you’re making a unilateral change or requesting that an employee agrees to a change. Making a letter also creates a record of the negotiations or changes.
For more information, read Changing employment terms.
Agree on flexible working arrangements
The term ‘flexible working’ encompasses most working arrangements outside of the ‘ordinary’ – including working from home, part-time, or compressed hours (ie working your regular quota of hours over fewer days).
If an employee has at least 26 weeks of service with their employer they are entitled to make a request for a flexible working arrangement which you must at least consider. If you choose to refuse the request, you must do so based on one of the eight reasons permitted under the Employment Rights Act 1996.
An employee may request flexible working to accommodate, for example, their new school-year schedule or additional employment that they’ve taken on to increase their earnings. As a compassionate employer, it’s good to support employees by approving these requests when possible. Allowing employees to work in a flexible manner that suits them can also help increase their work satisfaction and consequent productivity, and can help your business to respond to changing staffing requirements.
You can make a Flexible working policy to clearly communicate your approach to flexible working to employees. For more information, read Flexible working.
Shift to part-time or zero-hours contracts
One alteration to employment terms that can provide flexibility for employees and employers, as well as potential cost savings for employers, is moving staff to part-time or even zero-hours contracts.
You should be aware of employment law issues that may arise if an employee agrees to move to one of these contracts. For instance, if your part-time workers are excluded from any workplace benefits, you must objectively justify this to avoid discrimination.
Zero-hours contracts are complex in that some people working under them have employee status while others do not. Those without have some of the same statutory rights as those with employee status (eg to be paid minimum wage and not unlawfully discriminated against) but don’t have others (eg minimum notice periods). If you’re moving an employee to a zero-hours contract, you should make sure you uphold their rights and discuss their altered rights during the negotiation process. You should also be aware that employees with zero-hours contracts cannot be prevented (ie by an exclusivity clause) from working for other employers as well as you.
Zero-hours contracts are not always appropriate. For instance, they generally shouldn’t be used to employ people in a business’ core roles. They may be mutually beneficial if, for example, an existing full-time employee is going to university and wants to keep working for you in an altered capacity when it fits with their new schedule.
For more information on these areas, read Zero-hours contracts and Part-time workers. You can use our template to make a Zero-hours contract.
Ask employees to opt-out of the 48-hour work week
Another thing you can do to increase workforce flexibility is ask employees to agree to opt-out of the 48-hour work week (ie the upper limit on working hours set by the Working Time Regulations 1998 (the ‘Working Time Directive’)). An employee must freely consent to opt-out of this working hours limit. Some people may be happy to do this so that they can work extra hours. You should use a Working time directive opt-out letter to formalise an employee’s opting out. For more information, read How to opt-out staff from the 48 hour week.
Altering working arrangements to work as well as possible for employer and employee should start with clear and respectful communication about what each side needs and can offer. Any changes must also be made in a legally compliant manner. If you have any questions about how to alter an employee’s terms of employment, you can Ask a lawyer for help.
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