Permanently flexible: The future of flexible working in UK law firms

23 May 2014Feature

Anna Gregory considers how UK law firms should manage the new legal rights of all permanent staff to request flexible working

Law firms are not, by and large, at the cutting edge of flexible working practices. But legislative developments and broader socioeconomic pressures mean that, like it or not, change
is afoot. The winners will be the firms that see the potential in these changes, adapting rather than running scared of them.

Let’s consider the forthcoming UK legal changes in terms of
the right to request flexible working.

Legal rights

Children and Families Act 2014

Since the statutory right to request flexible working was introduced in 2003, only parents or others with caring responsibilities have been able to invoke the procedure. The Children and Families Act (CFA) removes this restriction. From 30 June 2014, all employees with the necessary 26 weeks’ continuous service (provided they have not made a statutory request within the previous 12 months) will have the right to request changes to their working hours
or place of work.

The cumbersome and prescriptive statutory request procedure is also being abolished. Employers will instead have a duty to consider requests in a reasonable manner, notifying the employee of the business decision within three months of the request unless an extension is agreed. The request can be treated as withdrawn if the employee, without good reason, fails to attend either two consecutive meetings to discuss the request or an appeal.

The CFA also provides for shared parental leave and the right to time off for antenatal appointments. Those provisions won’t come into force until April 2015 and initial uptake of shared leave may well be slow. But, in the medium term, the combined effect
of this legislation and the broader changes described below will
be significant.

The right to request – new eligibility rules at a glance

Any employee with 26 weeks’ continuous service
No other statutory request made in the previous 12 months
Request must be made in writing and specify:

o date of request, changes sought and the date they would ideally come into effect;

o what effects, if any, the employee thinks the requested change(s) would have on the employer, and how these could be dealt with;

o a statement that this is a statutory request; and

o if and when the employee made a previous request.

ACAS Code of Practice

In anticipation of this new legislation, in January 2014 ACAS published the response to the consultation on its Draft Code of Practice for Handling Requests to Work Flexibly in a Reasonable Manner.

The draft Code went further than the CFA and explicitly proposed that employers should approach requests from
a presumption that they would be granted in the absence of
a business reason not to. This presumption has been removed following suggestions that the wording could give employees
false hope and thereby damage the employment relationship.

Employers are now simply advised to “consider the request carefully looking at the benefits of the requested change in working conditions for the employee and your business … weighing these against any adverse business impact of implementing the change” (see box: The right to request – new eligibility rules at a glance).

The Code is not mandatory and failure to follow it will not
trigger an automatic increase in any compensation awarded. However, it clearly sets the benchmark and will be taken into account by tribunals in any subsequent litigation.

Rejecting requests

As before, there will be no automatic right to work flexibly, simply
a (greatly) expanded group of employees who can request it and
a relaxed method for delivering a decision.

The existing statutory list of valid business reasons for rejecting a flexible working request will stand. A rejection must therefore
be by reason of at least one of these (see box: Potentially valid
reasons for rejecting a flexible working request).

Potentially valid reasons for rejecting a flexible working request

Burden of additional costs
Inability to reorganise work amongst existing staff
Inability to recruit additional staff
Detrimental impact on quality
Detrimental impact on performance
Detrimental effect on ability to meet customer demand
Insufficient work for the periods that employee proposes to work
A planned structural change to the business

Competing interests

Alongside the Code, ACAS has also published good practice guidance on how to handle tricky situations in Handling Requests in a Reasonable Manner to Work Flexibly: An Acas Guide.

An increasing challenge is how to handle multiple requests.
The guidance says that employers “are not required by the law to make value judgements about the most deserving request”, but that they should “consider each case on its merits looking at the business case and the possible impact of refusing a request”.

Advocating full and frank discussion with employees throughout the process, the guidance proposes instituting a comprehensive policy which deals with how the business will approach simultaneous requests (even noting that the ‘random selection’ of competing requests would be acceptable in the event that the business
is unable to cope with all of the requested changes).

Sadly, the guidance offers limited practical advice on the key legal risk, namely the interaction of flexible working requests and the responsibilities imposed by the Equality Act. In considering the business reasons for refusing a request, employers must continue to be careful not to discriminate indirectly on grounds of a protected characteristic (sex, age, disability, religion and so on), any of which might well lie behind the request. Further, employers must not inadvertently discriminate by failing to comply with their duty to
make reasonable adjustments where the employee has a disability.

Significance of changes

The overhauled right-to-request procedure will increase flexibility for firms and employees alike – that can only be a good thing. In reality, many employers have not been following the current procedures
to the letter and can now do so with a clearer conscience.

Despite officially extending the right to request flexible working to all employees (not just those with caring responsibilities),
some argue that, in practice, this will have no substantial impact
on the majority of employers.

CIPD research from May 2012, published in Flexible Working Provision and Uptake, suggests that 63 per cent of workplaces
had already allowed all of their employees to request flexible working. Arguably, statute is just catching up with systems which have been embraced by progressive businesses for years.

On balance, however, this argument underplays the likely impact of the CFA when put in a broader context. Flexible working requests from employees without caring responsibilities, while not unheard of, are not yet commonplace. The combination of legislative backing and other developments within the world of work have the potential, together, to herald a new way of doing things and significantly
more requests.

Impact on law firms

Let’s now consider flexible working in the legal profession and the bigger picture.

The difficulties

Most managing partners will agree that flexible working is increasingly important to business success and that these legislative changes reflect a nascent revolution in the interplay between work and personal life.

Many firms already have policies which reflect the legislation that is coming in. Virtually all firms espouse the importance of a diverse workforce and talent retention. And yet, in reality, the profession is either losing or alienating a great many talented individuals whose flexible working aspirations are not yet being met.

Flexible working is becoming more than just a women’s issue.
But, the lamentable statistics on female retention and promotion
speak volumes about the current reality of flexible working in law firms.
In 2013, 17.6 per cent of all partners in the UK legal market were women and just 13 per cent of equity partners at UK top-20 firms were women, according to The Lawyer. Pause for a second to consider how shocking that statistic actually is.

Research conducted by Professor Janet Walsh at King’s College London in 2010 indicates that 41 per cent of women lawyers had some form of flexible working arrangement.
The report An Examination Of Women Solicitors’ Careers, Work-Life Balance And Use Of Flexible Work Arrangements noted their general perception that law firms offered low levels of organisational support for work-family/personal life needs.

It also noted that 52 per cent of women lawyers “felt that to get ahead at their organisations, lawyers were expected to work long hours and to take work home at night and/or on weekends” and that one in two of the survey respondents “believed there were (negative) career consequences associated with using work-family/life policies and that lawyers who made use of such policies were viewed as less serious about their careers”.

It seems therefore that, in many firms, the gap between stated aspirations and successful uptake is quite stark. Why is that? Why as a profession do so many find flexible working so threatening?

Lawyers are trained to identify problems and tend towards risk aversion, so it is perhaps unsurprising that so many flexible working requests are rejected. Others are never made, with lawyers concluding that practicing law and having a life don’t mix and voting with their feet, or continuing to work traditionally but with a corrosive sense of resentment.

Of course it would be naïve to pretend that flexible working does not present challenges. It does – and will continue to do so. Chief amongst these perhaps is the weight of client expectation – normally a firm’s first line of defence when rejecting a request. Clients want timely advice from their preferred adviser, the flip side of which is that lawyers are traditionally expected to work long hours. Flexible working arrangements must also work for the whole team, and it is arguably easier to manage a team of office-based
full timers.

The future

Flexible working is often not straightforward. But, firms need to
deal with it because the challenge is not going to go away.
On the contrary, it is set to increase for the following reasons.

Generation Y has a more flexible definition of success. Following a lengthy, linear career path ending in the holy grail of equity partnership seems unappealing and improbable to many young lawyers. We should not be surprised if the five-day office-based week traditionally required to ‘make it’ seems correspondingly unattractive.
As men play a more prominent role in childcare, with an increasing number not necessarily being the principal earner, flexible working requests from fathers are more likely. It may well make sense for the father to work flexibly as well as or in place of the mother.
An ageing population and later retirement mean that more employees will have eldercare responsibilities and hence a potential need to work more flexibly.
The proportion of women in the profession is increasing. The availability of flexible working directly impacts on the retention of women lawyers.
Property prices, particularly in London, will compound the need for two incomes and force many to commute further. Property costs and space constraints will also encourage law firms to promote more flexible and cost-effective hot-desking practices.
Technological advances have demolished the barrier between work and home, both psychologically and practically. Lawyers find themselves connected to the office even when they are supposedly not working and are often required to be contactable from home during evenings and weekends. The flip side is a sense that they should be trusted to work remotely on a formal and regular basis.

The benefits

Flexible working should of course be seen as an opportunity, not just a challenge. Following research conducted in 2010 which found that resistance to flexible working was “the single most significant obstacle” for women reaching senior roles, the Law Society introduced a Flexible Working Protocol in its Diversity and Inclusion Charter. Its Statement of Commitment
to the Flexible Working Best Practice Protocol sets out the business case for encouraging flexible working in the legal profession (see box: The Law Society’s business case for flexible working).

The appreciation of flexible working as a tool for effecting employee satisfaction stretches further back than this. An employee survey carried out for the CIPD by Kingston University/Ipsos MORI in 2006 found that “workers on flexible contracts tend to be more emotionally engaged, more satisfied with their work, more likely to speak positively about their organisation and less likely to quit”. All law firms would benefit from that. And, in a lumpier market where client demand varies,
a flexible workforce also makes far more sense than its static
full-time alternative.

The Law Society's business case for flexible working

Retaining key talent long term
Improving efficiency and return on investment
Environmental and productivity impact
Enhancement of reputation
Motivation and productivity

The way forward

Firms must embrace the shift towards flexible working – rather than just pay lip service to it – if they genuinely wish to attract and retain their most talented and diverse workforce.

It must be accepted that most requests pose challenges, many are overoptimistic and some are unworkable. There is no magic solution to the difficulties raised. Often, however, the stated reason for turning down a request does not withstand close scrutiny.
Trial periods are also under-used; it is often better to reject a request after having first attempted it and identified real rather than imagined problems. Be sure too to explore any scope for compromise;
an employee’s first suggestion may not be their bottom line.

The greatest legal risk in rejecting a flexible working request will continue to be discrimination claims, which are a particularly difficult experience given the potential for adverse publicity, limitless compensation and the sheer amount of management time involved.

But, beware too the non-litigious disgruntled employee whose request was rejected but stays under duress. Disillusionment has a habit of impeding performance and, consciously or inadvertently, these people can undermine the morale of others and spread
a damaging message externally.

This is not to say that all flexible working requests should be accepted. But, the drawbacks of saying no should not be underestimated, even if they fall short of litigation.

Flexible working arrangements should be seen as playing
a vital role in organisational performance. The infinite array of
home working, part time, job sharing and flexi-time options
should be used as strategic tools in supporting individual and business performance.

There is a strong link between flexible working and employee engagement, well being and productivity. Good flexible working arrangements result in reduced absenteeism, improved retention rates and recruitment savings. The majority of flexible workers make it work because their employer has empathised and trusted them, resulting in loyalty and hard work.

As the legal profession emerges, blinking, into the bright light
of a new era, the successful firms will be the ones that:

invest in the technology to make flexible working work;
trust their lawyers to behave like professionals and get the
job done;
manage people proactively, addressing problems when they arise; and
encourage, promote and celebrate flexible working role models.

The future is flexible.

Anna Gregory is a partner in the employment team at UK law firm Farrer & Co (www.farrer.co.uk)