Employers sidestep consultation in alternative working arrangements

by 29 Apr 2009

With an increasing number of businesses considering the option of implementing varied working arrangements for employees in the current economic downturn, they must consider the importance of seeking consent from staff in order to avoid breach of contract claims, according to Harmers Workplace Lawyers.

“I’m hearing more and more from employers that flexible workplace arrangements are proving their business case as business leaders and senior management begin to realise the benefits over having to make people redundant,” said Joydeep Hor, managing partner of Harmers Workplace Lawyers.

Certain industries, such as transport and logistics, as well as professional services firms such as law firms and property consultancies are looking at implementing alternative working arrangements as many of their clients cut expenditure, according to Hor.

“Alternatives to redundancies can take a number of different forms in relation to changes to employees’ working arrangements,” he said.

“Examples of what I’m seeing businesses implement include: nine-day fortnights; a requirement for employees to take their annual leave once they reach a certain threshold; salary and recruiting freezes; and redeployment of staff to other areas of the business.”

However, he cautioned employers against implementing alternative working arrangements without consulting the affected employees.

“Central to the issue of changing working arrangements is the notion of consent. Employers can’t just decide one day that changing working conditions makes good business sense, and then turn to their employees the next day to say ‘this is what is happening’,” he said.

“When an employee’s working arrangements are altered, it is effectively an alteration of their employment contract, and therefore requires the consent of the employee. Without this consent the employer exposes themselves to litigation, as well as potentially harming employee trust and morale.”

Honesty and transparency when communicating any potential changes are critical if employee morale is to be maintained, and Hor said that employers should see flexible working arrangements as an opportunity to build trust with their employees.

“Apart from the obvious financial benefits to a company, offering employees flexible working arrangements gives employers a chance to show their staff how much they value them. The employer is essentially saying to its staff: ‘We don’t want to make any redundancies. We are so committed to retaining you that we are willing to take a flexible approach to do so’,” he said.

“Employers may be surprised that some employees, particularly those wishing to spend more time with family or those considering undertaking further study or travel, will be very open to the proposal.”

In most smaller workplaces, he said consent must be sought on a one-on-one basis with each individual employee. However, if employees are represented by a union, consideration needs to be given to consultation with unions also.

“Those employers with good working relationships with unions will often find that union endorsement will help speed up the employee consent process. Either way, an appropriate amount of time must be given to employees for them to adjust to any changes. The idea of working a 4-day week or 9-day fortnight can take a substantial mind-shift, particularly for many full-time employees who have never known anything different.

“What I’m also seeing is that many employers are happy to preserve employees’ full-time entitlements, even though they may agree to reduced working hours or days, so that in the event that the role is ultimately made redundant, the employee doesn’t lose out further. This is another way of building trust with your employees, and increasing morale of your workforce in a climate of uncertainty.” Hor said.

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