Is working nine-to-five becoming a thing of the past? It appears that it will be if President Barack Obama has his way—at least for some employees. Emphasizing the need to ensure that federal employees can balance their responsibilities at work and home, Obama recently issued a memorandum to federal agencies directing them to let their employees know they have the right to request schedule flexibilities. He issued it in June, following a daylong White House Summit on Working Families, where he praised the efforts of several high-profile companies that have adopted family-friendly best practices. The president’s memorandum only impacts employees of federal agencies; federal law currently does not require private (nongovernmental) employers to consider or grant a request for a flexible working arrangement (FWA). Although legislation has been introduced in Congress that would give employees the right to request such a schedule, it is unlikely to be enacted in the near future in light of the current congressional stalemate.
Employers may, however, find themselves facing state and local laws that require them to at least consider FWAs. Currently only Vermont and the city of San Francisco have enacted such laws, but a number of other municipalities are considering similar measures. Additionally, multinational employers likely are already familiar with FWA laws, which are common in many countries including, among others, Australia, New Zealand, Northern Ireland and the United Kingdom. Thus, employers would be well served to understand the various types of FWAs and determine which would best suit their workplace, even if they are not currently covered by an FWA law.
What Is an FWA?
Workplace flexibility can take a number of forms. In his memorandum, the Obama identified a number of types of FWA that agencies must implement, including: part-time employment, job sharing, alternative work schedules and telework. The 2014 National Study of Employers conducted by the Families and Work Institute (FWI) and the Society for Human Resources Management (SHRM) identified 18 different workplace flexibility options. Those most frequently provided by employers include flexible starting and quitting times (flex time); employee control over when to take breaks; and time off to attend to important family or personal needs. Other options that were less frequently provided included permitting employees to gradually return to work after childbirth or adoption, and working from home on occasion. Options such as job sharing, working a partial year, “on-ramping” considerations for those returning from a career break and sabbaticals were much less common.
Employers that offer FWAs usually limit them to certain groups of employees; only a small percentage of employers reported making such arrangements available to all employees. Additionally, other studies show that flexible scheduling is most often an option for employees in professional, technology and science-based occupations, while few, if any, jobs in manufacturing provide flexible scheduling options.
Management Concerns Regarding FWAs
Many employers have taken a hard line against such FWAs as telecommuting, compressed workweek and job sharing. Although research has shown that FWAs can boost productivity, employee engagement and workforce retention, some employers view the management of such arrangements as too disruptive to the work environment. Other reasons for rejecting the idea of FWAs include cost concerns, the need for supervised teamwork, the difficulty of complying with wage and hour laws (problems with accurately recording work hours and avoiding off-the-clock work), job requirements and workloads that are not compatible with flexible staffing, potential abuse, and concerns about insurance and security.
Additionally, managers may not know how to manage employees in FWAs. A study published in the June 2014 edition of the Journal of Applied Psychology showed that some managers may unintentionally view employees who arrive at work later in the day as less dedicated than those who arrive earlier, even if those who arrived early achieved less or worked shorter hours than those who came in later. These negative biases can affect performance reviews and promotions (employers may be less likely to promote employees who will take advantage of FWAs), and may dissuade employees from taking advantage of FWAs made available to them by their employers.
What Do Vermont and San Francisco Require?
Effective January 2014, Vermont’s equal pay law gave employees the right to request an FWA and prohibits employers from retaliating against employees for making such a request. The employer must consider such requests at least twice a calendar year. The law requires the employer to discuss the employee’s request in good faith. Although the employer is not required to grant the request, the statute specifies that the employer must consider whether the request can be granted in a manner that is consistent with its business operations (i.e., costs, morale, ability to meet consumer demand, ability to recruit, quality of business performance, sufficiency of work, planned structural changes, etc.) and its legal or contractual obligations.
The law defines “flexible working arrangement” as intermediate or long-term changes in the employee’s regular working arrangements, including changes in the number of days or hours worked, changes in the time the employee arrives at or departs from work, work from home, or job sharing. If the employee makes a request in writing, the employer must notify the employee of its decision in writing. The attorney general, a state’s attorney or the Human Rights Commission (for state employees) enforce the law. Employees do not have the right to sue employers directly under the statute.
San Francisco’s Family Friendly Workplace Ordinance is similar to Vermont’s law, but also requires employers to post a notice of employee rights under the ordinance. It applies to employees with caregiving responsibilities who have worked for their employer for six months, at least eight hours a day, and covers private employers with 20 or more employees. FWAs defined in the ordinance are similar to those in the Vermont statute. The ordinance requires requests to be in writing and provides a detailed process with specific time frames for responding to requests and reconsidering denials. Employers must keep records under this ordinance for three years following the request for an FWA.
If the employer denies the request, it must provide the bona fide reason (i.e., cost of proposed change, effect on client or customer demands, inability to organize work among employees, insufficiency of work, etc.) for any denial, and must provide the employee with a copy of the reconsideration process. Employers may not interfere with or restrain employee rights under the ordinance, take adverse employment actions based on an employee’s “caregiver status” or retaliate against an employee for requesting an FWA. The Office of Labor Standards Enforcement is charged with enforcement of the ordinance.
Other U.S. Laws Regarding FWAs
In addition to the two laws discussed above, Washington State law encourages state agencies to utilize flexible-time work schedules to the greatest extent possible. Under Puerto Rico law, employees and employers may agree to a flexible work schedule, and employers must give priority for requested flexible schedules to employees who are heads of families with sole custody of minor children. Additionally, the Seattle City Council has passed two resolutions designed to reduce the gender wage gap, one of which outlines steps to close that gap by offering employees more family-friendly employment arrangements, such as paid parental leave and FWAs.
FWA Laws in Other Countries
The U.K. law requiring employers to consider requests for FWAs is similar in many ways to the Vermont and San Francisco laws. It gives employees the right to request flexible working, but does not require employers to grant such requests. The law previously applied only to workers with caregiving responsibilities, but was extended to cover all employees with 26 weeks’ service, effective June 30, 2014. The law defines flexible working, which includes, among other things, job sharing, working from home, part-time work, staggered hours and phased retirement. Employers must deal with a request for flexible working in a reasonable manner and respond to the request within three months. The employer may deny the request for specific business reasons. Employees cannot complain to an employment tribunal merely because the employer denied their request for flexible working, but they can make a complaint if the employer did not handle the request reasonably, wrongly treated the employee’s application as withdrawn, dismissed or otherwise treated an employee poorly because of the request, or rejected a request based on incorrect facts.
New Zealand’s law is similar to that of the U.K. It gives employees who have care of another person, and who have worked for the same employer for six months, the right to request an FWA. Employers are required to consider such requests and must respond to the request within three months. Employers can deny the request for business reasons identical to those permitted under the U.K. law. Additionally, the flexible working options are similar to those found in the United Kingdom law, with the addition of time-banking, weekday/weekend swap and buyable leave.
Northern Ireland and Australia also permit employees with caregiving responsibilities to request an FWA and require employers to seriously consider such requests. Generally, requests may only be denied for good business reasons.
Other countries have taken action to encourage the use of FWAs. For example, the Chinese government has planned a one-year $500,000 pilot program to give employers an incentive to implement or improve their family-friendly FWAs. Singapore has enhanced its Work-Life Grant (a program that co-funds employers up to a certain amount for the cost of establishing FWAs) to include an incentive for employers to try out FWAs to see which one best fits their workplace. Additionally, the Malaysian government’s 2014 budget included tax deductions for training expenses and consultancy fees related to the implementation of FWAs.
The Bottom Line
Despite the arguments in favor of offering FWAs, it seems that many U.S. employers are reluctant to offer such arrangements to employees across the board. In light of this reluctance, we may see more states and municipalities enacting legislation comparable to the Vermont and San Francisco laws. Employers can prepare for the possible enactment of such laws by analyzing the different types of flexible arrangements that may be compatible with their operations. This analysis can be helpful in other contexts as well, such as responding to a request for an FWA as a reasonable accommodation under the Americans with Disabilities Act or intermittent leave under the Family and Medical Leave Act. Additionally, training managers regarding the benefits of FWAs can help eliminate unintentional ingrained biases and ensure employees know they can request such an arrangement without fear of reprisal.
Christopher Curran is a senior associate in FordHarrison’s Miami, Fla., office. He has experience working with employers on a broad range of labor and employment matters, including labor contract negotiations and collective bargaining, as well as employment-related litigation and agency investigations. FordHarrison is the sole U.S. member of Ius Laboris, a global alliance of leading HR law practitioners.