The Workers (Predictable Terms and Conditions) Bill receives Royal Assent

What matters

What matters next

The Workers (Predictable Terms and Conditions) Bill has received Royal Assent and will come into force, along with implementing regulations, in September 2024. This follows our previous article in which we considered the Bill and its wider implications.

The Workers (Predictable Terms and Conditions) Act (the Act) aims to address “one-sided flexibility” between employers and workers who undertake atypical work. The Act will give workers the statutory right to request a predictable working pattern and follows recommendations set out in the 2017 Taylor Review of modern working practices. This is most likely to impact gig economy workers, as well as those working in industries which implement unpredictable shift patterns or short-term engagements. We consider how the Act will operate in practice, as well as the key considerations for employers moving forward, in light of the changes. 

How will the Act operate in practice? 

Under the Act, a worker will be able to request a predictable work pattern if:

  1. any part of their work pattern lacks predictability (for example, in the case of casual workers whose hours may vary at their employer’s discretion, or a worker with a fixed term contract of less than 12 months in duration); 
  2. the change relates to their work pattern (for example, their hours, days of working or period of engagement); and 
  3. they seek a more predictable arrangement. 

However, the right to request flexibility will not be a right that can be exercised from day one; it is expected that a worker must have worked for the employer for a minimum of 26 weeks to benefit from the Act - but continuous working is not required during that 26-week period. The legislation will also apply to agency workers, who will be able to make such a request of either their agency or the hiring company. A maximum of two applications can be made in a 12-month period and the application needs to set out the change that is being requested and the date by which the worker would like it to take effect. 

Receiving requests as an employer

There is no obligation for an employer to accept a worker’s request for a predictable working pattern, however, they must deal with requests reasonably and the worker must be informed of their employer’s decision within one month of the request. If the worker’s request is granted, the new terms must be implemented within two weeks of the request being granted, and the employer should not make amendments to other contractual terms which could be unfavourable to the worker.

If the request for predictable work is refused by an employer, this must be based on at least one of six prescribed statutory reasons (although, note that the Secretary of State reserves the right to add additional grounds if necessary). These grounds broadly reflect the list of acceptable reasons for refusing a request under the flexible working regime and are as follows: 

  1. the burden of additional costs; 
  2. If granting the request would cause detrimental impact to the employer’s ability to meet customer demand,
  3. If granting the request would cause detrimental impact to the employer’s ability to recruit staff,
  4. If granting the request would cause detrimental impact to aspects of the temporary work agency’s or hirer’s business,
  5. If there is insufficient work available for the worker to do; or 
  6. If there are planned structural changes.

Possible penalties

If an employer does not follow the requirements under the Act, then a worker may bring a claim in the Employment Tribunal. Further details in respect of penalties and the maximum amount of compensation workers can seek to claim will be set out within the relevant regulations. This is likely to follow the framework of penalties under the flexible working regime, however, it should be noted that claims related to flexible working requests are often brought alongside discrimination claims (for example, if a flexible working arrangement is sought due to caring responsibilities or an individual’s disability). It is unlikely that requests for predictable work will raise discrimination issues in the same way which should reduce the financial risk to employers – although this will need to be assessed on the facts of each case.

Challenges to businesses?

Whilst employers will want to be mindful of these changes, they will have a year to prepare before they are introduced in September 2024. A new ACAS Code of Practice will tackle how to make and process requests, and a draft Code of Practice is anticipated to be available for public consultation in Autumn 2023. This should assist employers in implementing appropriate policies and procedures in advance of the Act coming into force. 

The government has introduced this legislation with the aim of stabilising working arrangements for workers, which in turn they hope will lead to higher job satisfaction and a greater retention of staff. Whilst this is well-intentioned, it remains to be seen how beneficial the changes will be for workers in practice given that they have no automatic right to predictable work. In theory, it could be relatively easy for employers to rely on one of the statutory grounds for rejecting a request if business need necessitates. Nonetheless, the Act will undoubtedly place an increased administrative burden on employers, and they should watch this space as further guidance becomes available to ensure that they remain compliant.  

Disclaimer

This information is for educational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given. © Shoosmiths LLP 2024.

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