Employment Relations (Flexible Working) Bill

(Limited Text - Ministerial Extracts only)

2nd reading
Friday 19th May 2023 Lords Chamber

[The Minister of State, Department for Business and Trade (The Earl of Minto) (Con)]

My Lords, I thank the noble Baroness, Lady Taylor, for bringing this important Bill forward for debate today. It is an honour to be here to confirm the Government’s ongoing support for the Bill, and I thank all noble Lords who have spoken on this important matter.

The ability to vary the time, hours and place of work is an important element of the flexible labour market in Great Britain. Having access to flexible working arrangements enables individuals to participate in the labour market in a way that suits their circumstances. I see this in how flexible working plays a part in a host of cross-government strategies; whether it relates to disability, childcare, health or retirement, we know how important flexible working can be in helping people to stay in work doing jobs that they enjoy. Many of these strategies seek to encourage workplace conversations. We know that, with a good discussion and a bit of flexibility, working patterns can be adapted to benefit not only individuals but employers.

For employers, supporting flexible working could ensure the retention of an experienced worker, and all the skills and experience that they contribute, or create a more diverse senior leadership team, which studies have shown leads to improved financial returns. Furthermore, one of the key challenges for businesses today is finding good people to hire.

In this context, promoting and implementing flexible working can also make the workplace more attractive to potential applicants. This is supported by research conducted by the Behavioural Insights Team, showing that offering flexible working can, as has already been said, attract up to 30% more applicants to job vacancies.

There are also more fundamental structural issues to consider. More than 8 million people in the UK work part-time, representing a quarter of the working population. We need to make sure that the labour market continues to accommodate a diverse range of working patterns to ensure that everyone can participate and that businesses have the people they need. That is why the Government are pleased to support this Private Member’s Bill, which will help to facilitate better access to all forms of flexible working, whether that relates to when, where or how people work.

As set out by the noble Baroness, Lady Taylor, the successful passage of this Bill will introduce changes to the existing right to flexible working. This right was introduced in 2003 for employed parents and carers of children under the age of six and disabled children under the age of 18. The legislation has since been amended several times, most recently in 2014 as part of the Children and Families Act. Currently, all employees with 26 weeks’ continuous service can formally apply, once in any 12-month period, for a contractual change to the hours, timing or location of work.

In September 2021 the Government published a review of the legislation, which found that in the vast majority of cases—83%—where a statutory request is made, it is accepted. The review found the framework to be functioning adequately but highlighted some relatively minor areas for improvement. In the same month, the Government launched a consultation that considered proposals in each of these areas. We published our response to that consultation at the end of last year. I am pleased to say that the measures in the Bill reflect what we set out in our response.

The new consultation requirement will mean that employees and employers are encouraged to have a broader conversation about what flexible working arrangements may be appropriate before a decision is reached, avoiding the scenario in which an employer rejects a specific request out of hand. Allowing employees to make two statutory requests every 12 months updates the legislation, so that the right-to-request entitlement operates more flexibly and can be used more frequently if people’s circumstances change. Reducing the timeframe within which employers must respond to requests, from three to two months, will simply speed up the whole process. Removing the requirement for the employee to set out the impact of the requested change removes red tape from the process and levels the playing field between employees who have been with the organisation for a shorter or longer period, as well as between those who are more or less capable of presenting a case for their application.

I will take a moment to highlight the other measure that was set out in the consultation response and will be implemented alongside the Bill to complete the package. We will remove the 26-week qualifying period and make the right to request flexible working available to all employees from the first day of their employment. This will not only encourage early conversations about the availability of flexible working but bring an estimated additional 2.2 million people into the scope of the legislation.

These changes represent a timely, sensible and proportionate update to the right to request flexible working, and reflect what many employers already do. The changes will particularly support those who need to balance their work and personal lives, and who may find it harder to participate in the labour market. From older workers to new parents to those with disabilities—the point about MS is extremely well made—or long-term health conditions, the Bill will be an important step in supporting their ability to remain and progress in work.

It is important to acknowledge that there is no one-size-fits-all approach to work arrangements and there will be times when a requested pattern is unworkable. That is why the legislation leaves space for employees and employers to work out the right arrangements for their particular circumstances, and for employers to continue to decline requests for one of the specified business reasons.

I am pleased to reassure the House that the Bill contains only a single provision concerning delegated powers: a standard power for the Secretary of State to bring the provisions of the Bill into force by commencement regulations. That approach seems to have been accepted by the Delegated Powers and Regulatory Reform Committee, which in its report published on 2 March 2023 stated simply:

“There is nothing in this private member’s Bill which we would wish to draw to the attention of the House”.


I hope that is ample reassurance for noble Lords.

Before going into specific points, I say that I hope that my speech has addressed most of the points raised. On the wider question raised by the noble Lords, Lord Davies of Brixton and Lord Browne of Ladyton, it is true that the 2019 Queen’s Speech said that there would be an employment Bill. We then went into Covid, and the Government are taking forward many of their manifesto commitments on employment law by supporting this and other Private Members’ Bills.

The noble Lord, Lord Davies of Brixton, also raised the question of what determines consultation—a very difficult thing to put your finger on, I imagine. The issue of consultation will be dealt with in guidance; we want to encourage positive conversation about what flexible working may be possible which meets the needs of both parties. But we do not want that to be a burdensome bureaucratic process on whether the consultation requirement will be enforceable.

The question of advertising is an interesting one. There is a downside to advertising, because it gives employers the opportunity to say no from the outset. We consulted on advertising in 2019. Clearly there is a strong business case for employers to do this; to some extent, why would they not? The trials with Zurich have proved that 30% more applications are received. But the view is that rather than pursuing this through legislation, we will take a voluntary approach, as set out in the business case.

I agree with almost everything that my noble friend Lord Holmes said. On the question of unpaid internships, I never did not pay an intern. It is incredibly important to make people realise early on in their working lives that if they give the time, they get properly rewarded. His point about the challenges that AI is going to present us was extremely well made. I will turn briefly to the comments of the noble Lord, Lord Browne, and I think he is absolutely right; what we are doing is turning a cultural shift into law. I think that is very good. The point about higher versus lower earners is another well-made point, and I hope that the consultation process will address that. To the noble Lord, Lord Palmer of Childs Hill, I say that I also remember the water cooler. It is very important to have a little cultural place, where people can meet and chat freely, to drive the culture of a business and the ethics in any organisation.

Supporting the Bill is in line with the Government’s ongoing commitment to build a strong and flexible labour market that supports participation and economic growth. I observed a welcome degree of cross-party co-operation and support in the other place, and I think it is a testament to the strength of our system that we can work across parties, putting aside our rivalries to deliver change which will make a real and positive impact on people’s lives. With this in mind, I look forward to continuing to work with the noble Baroness, Lady Taylor, as this Bill progresses through the House.