Clock faceOn Friday last week the Financial Times reported on proposals from the Business Department to “rip up worker protections” under the current Working Time Regulations.  But simultaneously on BBC News online, look, it’s the Business Secretary himself denying on twitter any notion that his department is planning to dilute UK workers’ rights.  The very idea. Instead any changes will “protect and enhance workers’ rights going forward“.

A glance at the responses to the Secretary’s tweet reveals an overwhelming tidal wave of public scepticism about this, a clear win on credibility for the FT over the government.  One principal cause of that is obviously that if any changes to the Working Time Regulations were protective or augmentative in their effect, there has never been anything in our membership of the EU stopping us making them.  “Leaving the EU allows us to continue to be a standard-setter“, the Business Department is reported as saying, seemingly without any of the embarrassment which should properly accompany that proposition.  The other principal cause of that public derision around government integrity, according to the Business Secretary’s twitter feed? Basically, the whole of the last 12 months.

Equally as foolish as a denial that working time rights will be affected, however, is the Shadow Business Minister’s response that “these proposals are not about cutting red tape for businesses but ripping up vital rights for workers.  They should not even be up for discussion“, and that the plans referred to are “taking a sledge-hammer to workers’ rights”.  It is obviously as much twaddle to say that every worker right under the WTR is “vital” as it is to propose that removing overtime from holiday pay (one of the proposals reported) would enhance the position for workers.

This unhappy mix of meaningless government platitudes, silly Opposition hyperbole and rank public scepticism obscures a handful of basic facts:

  • if the UK makes changes to the Working Time Regulations which have any material impact on its international competitiveness, then it faces retaliation from the EU under the post-Brexit trade treaty; and
  • despite reports that Downing Street is supportive of these plans, anything overall detrimental to worker rights will fly squarely in the face of repeated manifesto and referendum promises to protect worker rights; but also
  • it cannot be denied that rigid enforcement of the Working Time Regulations as they stand can lead to some pretty bizarre outcomes, especially around holiday pay and accrual.

So these are some possible suggestions for reform of the WTR in that respect if the political will exists and some way can be found through the extreme polarisation which any mention of these Regulations seems to create:

  • Amend the rules around the inclusion of overtime, commissions and other allowances in holiday pay so that they only include sums which it can be shown on a balance of probabilities were adversely impacted by the employee taking leave.

Here is an example of what I have in mind. At present, overtime will generally be included in holiday pay calculations if it is “normal” or “regular”.  Though those phrases are not usefully or consistently defined in the case-law, they would on their face clearly cover an employee who does substantial overtime in the last fortnight of each month but none in the first two weeks.  As matters stand, however, if he takes holiday in those first two weeks he will be entitled to an allowance in his holiday pay for the loss of overtime he would never have done anyway.  Averaging overtime and other supplements over 12 months doesn’t get past the basic point that he is then being paid more to go on holiday that he would have done if at work.

Similarly, it is obviously possible in some (not all, I fully accept) commission-based jobs to have a day or a week or a fortnight off without affecting your ultimate commission earnings in any way, either because the time off does not affect the completion of the deal or because you just do it when you get back instead.

I see no particular difficulty in the Tribunal being required to assess disputed holiday pay a little like unfair dismissal compensation, i.e. including account for the loss of any benefit (cash or otherwise) which the employee “might reasonably be expected to have had” but for his taking the holiday.

  • End holiday accrual during any extended period of maternity/adoption/shared parental leave when the employee is bound to be off work anyway.
  • End holiday accrual during long term sick leave, for example where employees are on PHI.  The thinking behind the Working Time Directive and Regulations is that paid leave is a health and safety measure required to allow workers to rest and recover from working, not from not working. And/or look again at whether sickness while on holiday really warrants the obligatory granting of replacement paid leave at another date, when no other disaster or problem which may utterly blight your precious time away would do so.
  • Retain the 48 hours week and workers’ rights to opt out and all the statutory protections against resulting detriment or dismissal, but expressly allow employers to make changes to terms or roles where the exercise of the opt-out makes it not reasonably practicable for the employee to remain in the same role or on the same terms as those who have not done so.
  • Limit holiday carry-over to (at most) six months from the end of the holiday year in which it was accrued.  The suggestion that holidays have any continued therapeutic or health benefits when taken up to 18 months after the period of work being recovered from (the suggestion implicit in current case-law) is clearly untenable in fact.
  • The counter to all that might be to move a little towards the EU position (hey ho), such that UK employers undertake not just a passive obligation to allow the taking of minimum holidays, but a proactive duty to encourage it and take reasonable steps to manage holiday rotas and workloads, etc., to make that feasible.  That would not require anything that good employers should not be doing already, but it would allow a tougher line on carry-over and so avoid both an administrative burden and the growth of indigestible holiday accruals and consequent liabilities on termination.

Anyway, these are just thoughts – if you agree, disagree or have other proposals, we would be very pleased to hear from you.  No doubt so would the Business Secretary, though for his academic interest only, obviously.