(a) The Full-time Contract
The traditional view of employment involves people employed under a contract of employment on a full-time, permanent basis. In fact, the traditional view went one stage further and represented men employed on a full-time permanent basis. However, we have already noted that this pattern of employment is no longer sustainable and full-time permanent employment is rapidly declining. A variety of alternative working arrangements are now common.
In the nineteenth century, a working week consisting of ten hours a day, six days a week, was common. Since then, there has been a consistent shift towards a shorter working week with an average official full-time working week now of 38 - 44 hours. In October 1998 the Working Time Regulations attempted to restrict the working week to 48 hours per week, although there is some debate whether this piece of legislation has been effective. Of course, there are many people (middle managers it seems from the research) who work well in excess of these hours.
(b) Shift Working
Shift working can be traced back for as long as there are records. In industry, split shifts were operated as early as 1694. One of the effects of increased competition in a range of industry sectors is that, in an effort to attract customers, particularly in
organisations supplying the end consumer, there has been a move towards offering a 24 hour, 7 day a week service (or as close to this as legislation permits). Even where this service is offered by using IT technology, this round-the-clock opening requires some staff. As a result, shift working is more common today than it ever was.
(c) Part-time Working
At one time, part-time working was relatively unusual. This was partly because it was uneconomic for the employer as national insurance costs for the part-time employee were disproportionately higher than those for the full-time employee. A part-time contract was seen as an unattractive alternative to those for whom full-time work was not available as rates of pay and benefits were proportionately lower than for full-time employees. However, the need for flexibility, labour and skills shortages and changes in national insurance rates have all led to a huge rise in the number of people now employed under part-time contracts.
Defining part-time work is difficult. Virtually any job which requires an employee to work less than the standard number of full-time hours per week for a particular
organisation is classed as part-time, so 'part-time' can mean anything from a couple of hours a week to 35 hours per week or even more. In the past, some employers tried to use part-time contracts as a means of reducing employment costs by requiring part- time workers to work close to a full working week but on a reduced pay rate and by restricting benefits such as paid holidays, sick pay, pensions and training opportunities to full-time contract staff. Recognising that part-time contracts offered the organisation greater flexibility, enlightened employers treated part-time employees equally to full- time employees and more recently, the Part time Workers Regulations have required this equal treatment by law; at least in theory!
The rise in part-time contracts in recent years has been almost exclusively female, with over 90% of new part-time positions being filled by women. Recent research by the CIPD suggests that employers are finding other benefits from offering part-time contracts. Part-timers are said to:
Have lower levels of absenteeism than full-time employees
Be better motivated
Be more productive.
However, part-time work is not without its problems. Employers are finding that:
They may need to adopt different communication methods where there are a number of part-time workers as, at any one time, many employees may be absent from the workplace.
There can be difficulties co-ordinating tasks, so traditional approaches to job design and work allocation may no longer be appropriate.
Some full-time workers can resent the flexibility offered to part-time staff, which can cause difficulties with work groups.
Where there are a large number of part-time employees, costs for training can be disproportionately high.
It can be more difficult generating involvement and commitment with part-time staff, who may be working so few hours that it is difficult to ensure that they are kept up to date with the objectives and values of the organisation.
Perhaps it is not surprising that many employers view part-time workers as a problem to be solved, rather than an opportunity for greater flexibility.
(d) Flexible Working Hours
Flexible working hours were seen, originally, as a means of overcoming travel to work problems. The most common approach to flexible working is where the employer has no fixed start or finish times but allows the employee to start work within a fixed
timeframe (say between 8am – 10am) and finish between a fixed time-frame (say 4pm – 6pm). Employees are free to choose when to start and finish work provided they are in attendance during the 'core' period and provided that, at the end of the period (week, month or some other arbitrary period), they have completed the minimum number of hours required.
Although such arrangements have been around for over 30 years, they did not prove particularly popular with either employers or employees. There are a number of reasons for this.
Employers found that if the 'core period' was too short, tasks requiring staff interaction were hindered.
There were increased costs from the increased monitoring required to ensure that staff completed the minimum number of hours.
The greater the flexibility offered to employees (for example by offering the opportunity for time worked over the minimum to be taken as time off in lieu of payment), the greater the disruption to work.
Even so, there were benefits to employers, mainly from reduced overtime costs and supporting an increased working day.
Employees were, at least initially, suspicious of the flexible working time as they saw it as a way of restricting paid overtime opportunities and they resented the way in which their attendance was registered, often by the re-introduction of the mechanical time clock.
Interest in flexible working hours has been increasing again recently, partly in response to the debate of the work-life balance.
The following case study was reported at the 2000 CIPD National Conference and appeared in People Management in November 2000.
Case Study 1
A BT trial scheme has produced hard evidence that employees with a better work-life balance really do make their organisations more profitable. Bob Mason, BT wireless's senior vice president of human resources, told conference delegates about a trial that initially offered 18 employees at a BT Work software office the opportunity to determine their own working times and patterns under a "Freedom to Work" agreement. It has since been rolled out to about 3,000 people.
"I've got real evidence to show [that a better work-life balance] reduces absenteeism and the costs of business and increases productivity," Mason said. "It's good business sense."
And employees reported that they felt increased loyalty to the firm and felt empowered to take control of their own lives. One employee turned down a better-paid job in favour of this increased flexibility, and other BT
employees expressed an interest in transferring to areas offering "Freedom to work", Mason claimed.
The company also accrued other unforeseen benefits from the new working systems. "We now require less office space", he said. "We stumbled upon a way of spreading the working hours right across the day." This has led to improved customer satisfaction, with customers across time zones – in the UK and India, for example – reaping the benefits of staff being available 24 hours a day.
In today's tight labour market, the business arguments for a better work-life balance were "compelling", Mason argued.
Source: People Management, 9 November 2000
(e) Annual Hours
One variation on the flexible working hours is that of the annual hours contract. This approach was developed in response to the difficulties sometimes faced by businesses with seasonal or fluctuating demand periods, either predictable or unpredictable. The main basis for an annual hours contract is that the period of time within which full-time employees must work their contractual hours is defined over a whole year. Such arrangements are becoming more common in manufacturing environments, where annualised hours enables the organisation to separate employee working hours from operating hours and use expensive plant and equipment over a longer period by operating a "five crew system", particularly in continuous process production, which enables the plant to be operated for 50 or more weeks in the year without the need for overtime.
Annualised hours are also becoming more common in fields such as further education, where the move towards modularised courses means that teaching staff can be
required to undertake more 'contact hours' at certain times of the year to meet the demands of student numbers.
Flexibility is one of the main advantages to the employer but on the downside, the system places some distance between the employer and employee, to the extent that the employee becomes more like a subcontractor, working as and when required.
(f) Temporary Contracts
Although no contract is, in reality, permanent, the traditional approach to contracts of employment is that they were indefinite. Temporary or fixed-term contracts have a definite start and finish date so are for a defined period.
The main use of fixed-term or temporary contracts is to cover periods of high labour demand, for example, the pre-Christmas period in the retail trade. Fixed-term contracts offer employers the flexibility to hire and eventually dispense with the services of
members of staff. This can also be valuable in periods of unpredictability and uncertainty, or where there is a short-term need for a particular skill or expertise that will not be required later.
Until recently, some employers saw temporary contracts purely as a method of cutting costs. Temporary staff, for example, didn't have to be offered paid holidays, sick pay or pensions. Furthermore, temporary staff could be got rid of without the need for
redundancy payments. Some organisations exploited this 'loophole' in employment protection legislation by issuing a series of temporary contracts so that the same employee could be employed for many years but on a series of one-year temporary contracts. Case law and legislation have combined to ensure that employees in this situation now have some employment protection in such circumstances but temporary contracts are still seen by many organisations as a route to cheaper labour costs. It would be easy to think that lack of job security would make temporary workers less committed to the organisation and less productive, but research tends to support the opposite view. Temporary workers are often more motivated and keen to put a lot of effort into their work, are rarely absent and often keen to work overtime if required, perhaps in the hope that they might become permanent.
(g) Distance Working
Distance working, or teleworking as it is sometimes known, is one form of flexibility that has been made possible by the advances in information and communications
technology. There are two main forms of distance working:
The individualised form of teleworking where an employee works away from the employer's premises, such as home-based teleworking or multi-location working
A form of collective teleworking where work is completed on non-domestic premises and managed by the employer or third party. This includes call centres and tele-cottages.
The number of people engaged in teleworking is difficult to estimate, as the nature and range of jobs that can fall into this category is vast. Sales representatives, for example, have always worked this way but now it is possible for a wide range of types of
employment to be undertaken by distance working. Some teleworkers may spend some of their working week at the employer's premises, whilst others never, or only rarely, work 'at the office'.
Managing teleworkers presents new challenges for managers. Particular care must be taken when selecting candidates for teleworking, as workers who are separated from the main activities of the organisation can feel isolated and lack motivation. Very clear parameters must be laid down to establish the criteria for decision making and issues that need reference back. New employees need an induction to the organisation in the same way as 'office-based' employees and indeed, may need more because the social aspects of work will be absent. Building relationships and team working present particular difficulties for those who are physically separate from the organisation. A great many organisations offer some form of teleworking now and most if not all point to reduction in office and support costs as one of the main advantages.
(h) Outsourcing
Outsourcing is another way of working that is increasing in popularity. Many large companies used to carry out various tasks in-house that they now contract out to external organisations that specialise in the field in question. In some cases, whole departments have disappeared and all the work is carried out by outside contractors. This has meant that numbers employed by the larger organisations have fallen but those employed by the smaller specialist organisations have increased.
Outsourcing has a number of advantages:
Outsourcing can be used in the same way as temporary contracts to reduce costs, particularly where the work is seasonal or of a temporary nature. Rather than set up a department or part of the organisation to handle a particular task or range of tasks, outside contractors may be employed. A typical example might be to outsource (use contractors) to handle a new product launch or the
installation of a new computer system. The contract would be for a limited period and when the period has expired, or the task has been completed, the contract ends.