Avoiding flexible working's hidden pitfalls
You don’t have to look too far to see that traditional modes of employment are increasingly giving way to more flexible working arrangements.
Returnee mothers, for instance, can be found working school hours during term time. Retired former employees are spending two days a week in the office, working as part-time consultants. And specialists in particular areas of expertise can be found working part-time, or on fixed-term contracts, as contractors.
The overall numbers of people employed within these flexible working arrangements is still quite low, of course. But it’s definitely the case that more and more employers are encountering instances where one or more of their staff are working within such a framework.
Flexible working’s darker side
And to be blunt, this is probably the worst of all possible worlds.
On the one hand, there’s a significant likelihood that employers will encounter a flexible working arrangement. But on the other hand, with only a handful of staff working within such arrangements, employers are unlikely to have built up enough of a body of experience to manage the phenomenon appropriately.
And this, unfortunately, leaves both employers and the staff they use open to a certain level of risk.
Moreover, the risks involved aren’t just those that might be imagined—inadvertent breaches of employment and taxation law, for instance, or niggles over holiday entitlement.
Instead, ask those employers who have fallen foul of flexible working’s less welcome side, and you’ll hear about disputes over intellectual property rights, arguments over pay and bonuses, ill-defined employment durations and deliverables, and disputes over eligibility for home working.
Who are we talking about?
But before diving into the detail, let’s take a moment to make it clear what sort of flexible working arrangements we’re talking about.
We’re not, for instance, talking about people on regular ‘9-5' employment contracts, where personal circumstances perhaps dictate some short-term flexibility—illness, disability, or childcare issues, for instance.
Nor are we talking about situations where a decision has been taken to offer all existing employees flexible working arrangements, should such arrangements be mutually acceptable. (Although watch out for a forthcoming blog from us, on precisely that topic.)
Instead, we’re talking about those part-time contractors, returnee mothers, retired ‘consultants’ and—increasingly—potential employees taken on in a ‘try before you buy’ arrangement, as an alternative to a probationary period.
In each case, studies show that flexible working arrangements can improve productivity, increase morale, and make productive use of people whose skills would otherwise go to waste.
That said, it is crucial that those flexible working arrangements are correctly framed from a contractual perspective—be that a formal Employment Contract or Consultancy Agreement.
What should such a document include? In our view, it’s important to lay out clear expectations in a number of important areas:
- What role is the person to fulfil?
- Is their payment based upon deliverables, or the number of hours spent working?
- What are the termination provisions?
- What is the position regarding holiday and sickness pay?
- Is on-site working required, or can they work from home?
- Can expenses be claimed, or are they included in the day rate?
- Who owns any intellectual property that arises? (Importantly, this includes not just patents and trademarks, but also the copyright in any materials produced.)
- Do you want to restrict the person from working for a competitor?
- If the person is planning to use materials they have licensed from a third party, do you have the right to use them too?
Note, these are not theoretical points. In each case, we have encountered issues.
And in some cases—particularly relating to intellectual property and payment provisions —those issues have been serious, giving rise to significant concerns or actual disputes.
Flexible working’s bottom line
So what to make of flexible working? As users of flexible staff ourselves, we have no doubt as to its value.
Employees and staff on flexible working arrangements are generally highly motivated, loyal, responsive, and very quickly get back to speed after a period away from the workplace.
They have skills that employers want to tap into, and—to the extent that flexible staff reduce recruitment requirements elsewhere in the business—reduce the levels of training required.
Even so, a prudent employer will recognize that it’s sensible to put protections in place, and proceed on a proper contractual footing.
To find out more, call Kirstie Penk on 020 3755 5099 at any time.
Posted Monday, November 9th, 2015 by Warren RylandTweet
Other Articles In This Category
- IR35 and the private sector: are changes on the way?
As the government considers extending to the private sector its public sector reforms of the rules relating to the engagement of contractors through so-called... read more
22nd of March 2018 by Warren Ryland
- GDPR: 3 practical questions facing businesses like yours
In just a few months—on May 25th—compliance with the General Data Protection Regulation (GDPR) becomes mandatory. The biggest change to data protection... read more
1st of March 2018 by Warren Ryland
- I'd like to work from home, says an employee. Now what?
Conversations about employees working from home were once very short. In those rare instances where employees did venture to enquire about the possibility, the... read more
8th of January 2018 by Warren Ryland
- Is a domain squatter set to steal your brand?
It’s fair to say that many businesses are unprepared for the new .uk Internet domain - which is unfortunate, as from June 2019, they could find that their... read more
5th of December 2017 by Warren Ryland
- Did you negotiate your last loan agreement - or just sign on the dotted line?
For businesses wanting to grow or invest, external finance can be an attractive option: access to the funds that they need, without equity dilution or... read more
2nd of November 2017 by Warren Ryland
- Protecting the value of your newly-acquired businesses can be a challenge
Buying a business is exhilarating. Hard work, to be sure - but undeniably exciting, and with a rich sense of the opportunities that lie ahead. So perhaps... read more
2nd of October 2017 by Warren Ryland
- GDPR. The clock is ticking: a tough new take on data protection is fast approaching
With effect from 25 May 2018—in other words, less than a year away—your business is exposed to a new regulatory regime backed by hefty fines. And by... read more
6th of September 2017 by Warren Ryland
- Persons of Significant Control: important changes to reporting requirements
It’s barely a year since the introduction of the PSC regime - and already, the compliance requirement has been tightened. And at a time when many businesses... read more
23rd of June 2017 by Warren Ryland
- Avoiding conflict when forming a business: probing questions for potential partners
Every year, several hundred thousand new businesses are created. In 2015, according to the Office for National Statistics, the total was 383,000—the highest... read more
28th of April 2017 by Warren Ryland
- Is your business at risk from the Uber decision? Why your self-employed contractors could really be employees
Fuelled by companies such as ride-hailing business Uber and personal courier firm Deliveroo, the so-called ‘gig economy’ is on the rise. So much so,... read more
12th of January 2017 by Warren Ryland
- The Legal Director - Commended for Innovation in the FT Innovative European Lawyers awards
Law firm The Legal Director (TLD) has been commended in the FT Innovative European Lawyers awards, which were announced at the beginning of this month. TLD ranked... read more
28th of October 2016 by Warren Ryland
- Debt versus Equity - Financing for SMEs
The need for additional finance is often the price of success for small to medium-sized enterprises (SMEs) that are looking to grow. The question that faces the... read more
14th of October 2016 by Warren Ryland
- The deceptive complexity of the Modern Slavery Act
At the end of July, Prime Minister Theresa May launched a cabinet-level government taskforce to eradicate modern slavery in the UK. It was, she said, “one of... read more
31st of August 2016 by Warren Ryland
- How our clients will benefit from the Bar Council's escrow account
Outside the narrow realms of consumer technology, there’s often an inevitable trade-off between cost and quality. In other words, you can have something at... read more
7th of July 2016 by Warren Ryland
- As the net starts to close, the Bribery Act prosecutions begin
As we have written before, the Bribery Act 2010 is a law with undoubted teeth. Fines are potentially unlimited, and custodial sentences can be up to ten... read more
1st of May 2016 by Warren Ryland
- New rules on shareholder identification are now in force
New rules on shareholder identification are now in force - and yet many businesses aren’t aware of them. Does your business have corporate or nominee... read more
12th of April 2016 by Warren Ryland
- First SRA-regulated law firm signs up to Bar Council's escrow account
PRESS RELEASE: The Legal Director has become the first law firm regulated by the Solicitors Regulation Authority (SRA) to sign up to the Bar Council’s... read more
31st of March 2016 by Warren Ryland
- Trade marks: the 3 biggest mistakes to avoid
Wander around a supermarket, or browse the advertisements in newspapers and magazines, and you’ll see trade marks everywhere. And it’s likely, too, that... read more
29th of February 2016 by Warren Ryland
- Are you paying your workers the right amount of holiday pay?
A recent ruling by an Employment Appeal Tribunal is set to cause many businesses a headache. Quite an expensive headache, at that. Simply put, it means that... read more
15th of July 2015 by Warren Ryland
- The Bribery Act 2010: are you running a risk of breaking the law?
To see the difficulties that businesses can get into through bribery - or even allegations of bribery - look no further than the reputational damage suffered... read more
11th of June 2015 by Warren Ryland
- It's official: "Lawyers are not cost-effective"
Imagine, for a moment, that when faced with a serious illness, significant numbers of people took no action. And of those who did take action, around... read more
20th of January 2015 by Warren Ryland
- Could a Shareholder Agreement save your business?
Here at The Legal Director, we’ve recently come across a business where the two co-founders have fallen out -- one is now leaving, in order to set up on his... read more
1st of December 2014 by Warren Ryland
- The high-fee culture that's hobbling British business
Another week, and yet another critical item in the press on the cost of obtaining corporate legal advice. And to be sure, it’s certainly a fairly open goal at... read more
11th of November 2014 by Warren Ryland
- Is crowdfunding the answer to your business's financing challenge?
As the credit crunch and ensuing recession of 2008 began to bite, lending to businesses dried up. To their shock, even long-established, profitable businesses... read more
2nd of September 2014 by Warren Ryland
- Complying with the Data Protection Act: 3 business bear-traps awaiting the unwary
Visit the website of the Information Commissioner’s Office, and there’s an interesting section entitled ‘Enforcement’. In it, the... read more
1st of September 2014 by Warren Ryland
- What might a Legal Audit reveal about your business?
When we start working with a business we assess their existing legal arrangements to determine how these can be improved and aligned with commercial objectives. We... read more
9th of July 2014 by Warren Ryland