Flexible working: Finding the right balance
Arvind Hickman, August 26, 2014
New flexible working legislation could radically change the world of business. But what are the challenges and opportunities for HR?
Flexible working, whether it’s in the form of part-time hours or working remotely, is not only gaining in popularity, but has now been given a jump-start.
On 30 June, new legislation was enacted that allows all employees the right to request flexible working. This means a company has to ‘reasonably’ consider flexible working requests, whereas previously only employees with caring responsibilities were legally covered.
While the laws have been cautiously welcomed by most corners of business, and certainly by this publication, questions remain over whether companies will be able to cope. HR magazine decided to investigate the likely implications of flexible working and where the challenges and opportunities lie.
What we discovered was broadly positive – that many businesses are already ahead of the curve on flexible working. For others, the major challenges are largely cultural; changing stigmas currently attached to flexible working as well as evolving performance management to focus more on outputs and outcomes rather than hours.
Traditionally, flexible working has largely been the domain of carers, particularly mothers of young children, but this is rapidly changing. Increased mobility, technological advances that make remote working easier, and demographic shifts are driving the demand for employees to work flexibly.
Karen Mattison, founder and director of Timewise, a recruitment firm that specialises in placements with flexible job designs, says flexible working is “100% here to stay”.
“A lot of businesses have become focused on what to call it – is it agile working, flexible working, part-time working or smart working? But if we just settle on the term ‘flexible working’, we are seeing an enormous appetite from employees and jobseekers to work in this way,” she adds.
In the UK, there are about 8 million part-time workers and 4 million people who work full-time roles flexibly.
Of the people working full time without any flexibility, 8.7 million (two in five) would like some form of flexibility, according to the Timewise report A flexible Future for Britain, which polled 1,161 workers and interviewed 500 managers with hiring responsibility.
Then there’s the growing popularity of fixed contract workers. A Recruitment and Employment Confederation (REC) report, Flex Appeal, found 36% of British workers have worked as a contractor, freelancer or agency worker at some point in their career and 41% are considering working that way in the future.
“Typically, one of the biggest groups who want flexibility are mothers and people who have caring responsibilities. We are also seeing people who want more of a portfolio career,” Mattison says. “They may be trying to grow a business but need a stable income for three days a week. People are approaching work in a different way and not expecting a job for life.”
Sarah Jackson, the chief executive of work-life balance charity Working Families, has been tracking flexible working for the past 20 years. She tells HR magazine that although acceptance has come a long way over the past decade, it is still skewed in favour of women with caring responsibilities.
“There’s been a cultural shift in the workforce for people who want to work flexibly,” Jackson says. “Depending on workplace, sector and demands of the job, some are getting flexibility and some aren’t – there is a flexibility gap.
“For example, if you’re a man, a manager and in manufacturing, you are likely to be among the flexible ‘have nots’. Whereas if you are a woman, non-manager and working in health services you probably are able to obtain flexibility.”
Although a flexibility gap may exist, many companies have accepted flexible working for employees not covered by the legislation for years and most of Working Families’ members (about 90 organisations) offer some form it.
What has changed in recent years, says Mattison, is that businesses are starting to see the value in flexible working. “When I started looking into this 10 years ago it was always thinking about the candidate or employee point of view, but now the conversations are shifting,” she says. “Businesses are starting to understand the value. This could include real estate cost savings – do I need a building in central London or could I encourage people to work at home in more of a routine way?”
The business case
The move towards employers embracing flexible working has several drivers.
Aside from legislation, more staff are now demanding flexible working patterns as career expectations change. A job for life is less appealing to younger workers and allowing flexibility is often used by companies to attract and retain talent.
During the recession that began in 2008, companies used flexible working arrangements to help keep overheads down when finances were tight.
REC chief executive Kevin Green says while this may have been the case, changing customer expectations and a 24/7 culture are today driving organisations to evolve the way they manage their workforces.
“Businesses are not working as much to traditional nine to five working cycles as before, particularly in some sectors. For example, in retail you’ll have busier periods like Thursday evening or Saturday.
“When I was at Royal Mail [as HR director between 2003 and 2008] we knew we’d have busy seasonal periods, such as Christmas, where our workforce would flex considerably. But workers also want flexibility. For example, we’d have postal workers who loved the early starts because they’d have the afternoons free to do something else.
“It’s important to be flexible, whether it be part-time, zero-hours contracts or other fixed-term contracts.”
Green says another trend he has noticed is an increase in flexible working arrangements for professional jobs, such as lawyers and accountants.
Then there’s the fact that post-recession, many businesses are trying to manage their workforces more efficiently and add flex during peak periods without unnecessarily increasing their cost base.
These trends are backed up by market research. An REC poll, seen exclusively by HR magazine, shows that of the employers who are looking to hire in the next six months, 28% intend to hire either part-time or contract/temporary workers, while 17% are looking to hire full time workers, although Green points out that two-thirds of recruitment growth is for full-time roles.
In the REC/KPMG July Report on Jobs, recruitment agency billings for temporary workers registered their strongest net increase for five months in June, extending the current sequence of growth to 14 months. At the same time the availability of permanent and temporary candidates has dropped to the lowest level since REC records began. This squeeze has led to a return to the candidate-driven job market that dominated much of the Noughties.
“It’s about talent retention,” Mattison says. “Can I afford to routinely lose people, particularly women in their thirties and forties, because I can’t offer them the flexibility they need?
“It’s also about performance, especially as we come out of a recession into a candidate-driven market. How am I going to attract, retain and progress the best people for the business? It’s no good for anyone if there is a continual exodus.”
At professional services firm EY, flexible working is being embedded in the company’s culture and offers many benefits, including attracting and retaining talent.
EY deputy COO Lynn Rattigan, who works four days a week, says younger talent tends to be more short-term in career planning compared to baby boomers and may, for example, want to go travelling after a few years. This has resulted in the firm evolving HR policies on the working environment.
“What we’ve realised in the past two years is that it’s as much about the work space that you have as well as how many hours you work,” she says. “For example, in EY we are currently going through a whole re-stacking exercise with our real estate so we’ve got a lot more collaborative working spaces and informal touchdown spaces.”
A trickle or a wave?
While there may be a strong business case for employers to embrace flexibility, the new legislation that extends the right to request to all employees means there is no longer anywhere to hide for those who have ignored it.
Experts believe the legislation will not lead to a rush of requests, but is a step in the right direction.
Patrick Foley, the chief economist at Lloyds Banking Group, works on a part-time basis and believes the right to request could encourage more bankers to come forward and consider flexible working.
“Just a change in the mindset of people to know they have the power to ask will trigger people to think about it,” he says. “Obviously there is a trade, more time at home for income, so you need to be financially capable of making that.”
Manufacturing company Oxford Instruments group HR director Claire Flint believes the legislation could encourage workers to come forward and points out that the original right to request legislation in 2003 had a positive impact because it formalised the process.
However, she warns: “I think it is harder for men, there’s a gender disparity because it’s not normalised.”
Kathryn Nawrockyi, director of Business in the Community’s gender equality campaign Opportunity Now, believes the new legislation will be an enabler for employees while Working Families’ Jackson says companies that offered flexible working rights within the strict boundaries of the old law (applicable to workers with caring responsibilities) could struggle to adapt.
“There is a chunk of British business who do everything by the book, and they’ll be worried what these new changes will mean for them. For them, this is going to be an interesting cultural challenge because all of a sudden there are no exclusions,” she says.
At this stage, it is still unclear whether the new rules will cause bigger headaches for small organisations or larger entities. A Federation of Small Businesses spokesperson told HR magazine that most small businesses are, at least publicly, supportive of extending the right to request to all staff.
However, Nawrockyi says some SME employers with smaller workforces are concerned they could lose time from workers that they have spent considerable resources on training in specialist skills.
“What I do think SMEs can do particularly well,” she adds, “is effect that culture change more quickly and the processes are less burdensome.”
Other managers have expressed concerns about setting precedents. At the inaugural Talent, Recruitment and Employment Confederation in June, one delegate feared flexible working could be awkward to manage if many team members requested it at the same time, while another said there is a culture to keep flexible working arrangements under wraps.
Inputs vs. outputs
Such concerns highlight one of the main barriers for flexible working to truly take off: poor performance management.
“There are plenty of organisations that still value face time to know that employees are working well but somebody could be very present in the office but not achieving maximum output,” Nawrockyi points out.
Companies that do flexible working well commonly measure performance on outputs and outcomes, rather than inputs and hours worked.
“One of the things that holds flexibility back is we’re not terribly good at managing,” Jackson adds. “People get promoted because they are good at doing what they do, suddenly you get to a certain level and you are expected to manage people and nobody has ever trained you how to do that.
“Getting flexible working right is a management challenge because you’ve got to be clear about objectives, deliverables and how, culturally, you want work to be delivered. That’s quite scary for a lot of managers who are wedded to the idea that you can only manage what you see, the hours you can see someone sitting in front of their screen.”
EY’s Rattigan says as long as business objectives are clear, employees should be trusted to decide how, when and where they work to deliver them.
“I’m not going to employ a builder to come five days a week, I will employ him to build a house and he’s going to tell me when he’s finished. So let’s talk about things you want me to do and let me deliver them,” she says.
A perception battle
Another challenge that must be overcome is the prevailing stigma attached to flexible working. Flint recalls that when she began working part-time in the 90s, it was regarded with suspicion.
“Partly because of legislation and shift in attitudes, people are more open to it now and understand that done in the right spirit it works very well for retention and commitment of the employee,” she adds.
While attitudes have progressed, one of the largest studies of women at work, Project 28-40, by Opportunity Now, found that stigmas still prevail. Two-thirds of the women polled believe working flexibly leads to perceptions you are less committed and nearly half felt it led to feelings of resentment by full-time colleagues.
According to Mattison, there are 650,000 people in the UK working part-time in senior roles (earning £40k and above). Timewise interviewed 300 part-time workers to gather their views.
“Although they were doing it, they didn’t want to be associated with it. They felt such a strong association between working flexibly and not being ambitious and they felt they would be passed over for a promotion,” Mattison says.
Timewise produces an annual Power Part Time Top 50 list of senior executives who work part-time hours. Mattison admits there have been occasions where senior executives have declined to feature on the list for fear of negative perception.
As well as tackling the perceptive problem, Mattison would like to see more transparency over part-time recruitment.
“You are told you have to come in on five days and earn your right to flexibility,” she says, rather than roles being advertised as such. “So what people are doing is trading their skills in return for flexibility. They’re sitting on the career ladder and they’re not progressing when they should be.
“Lots of them are women and that’s contributing to the gender pay gap because they’re leaving roles and coming back in on roles they are overqualified for on lower salaries. Their potential to earn is much higher, but they don’t find flexibility.”
The new right to request rules should change perceptions by empowering more employees, and particularly men, to request flexible working.
Although Jackson doesn’t believe the regulation will be “earth-shattering”, she says it could be a slow cultural burn.
“I think we will see a cultural shift where it will be OK for men to work flexibly because it will become alright for blokeish reasons to be doing it. It will make it alright for fathers to do it and it becomes normal,” she says.
“We know that when men ask to work flexibly for childcare reasons, managers often perceive them as not as worthy of childcare as mothers. What I want to see happen is men and women working flexibly for reasons unrelated to caring responsibilities – to work flexibly without being judged.”
As the companies here prove, working flexibly for non-caring reasons can not only work, but has benefits to both the employer and employee. More importantly, if organisations don’t adapt, they risk losing talent. And with an impending global skills shortage, this could have devastating consequences.
Evidently, flexibility is no longer just the ‘right’ thing to do for staff, it’s increasingly the best thing for business.
Read HR magazine's article 'Six steps to getting flexible working right'