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The Working Time Directive has failed to curb the UK’s long-hours culture. Rebecca Harding-Hill on the European Commission’s plans to restrict the opt-out clause

In the autumn last year, the European Commission adopted proposals to revise some of the main features of the Working Time Directive 2003. The proposals include further restrictions on the maximum working week opt-out provision.

Working time trends
The aim of the directive is to protect the health and safety of workers. The maximum 48-hour working week (in addition to provisions relating to rest periods and holidays) was intended to protect workers from the negative effect on health and safety of working long hours. Introducing a maximum average working week (set at 48 hours in the UK) was expected to decrease the length of the average working week. However, some studies have shown that setting this maximum has had little impact on the UK’s culture of working long hours.

According to statistics quoted by the Commission, the number of employees working more than 48 hours per week rose from 15 per cent of the workforce at the beginning of the 1990s to 16 per cent in 2004. Hours worked in the UK are longer than in Continental Europe. So why has the introduction of the maximum working hours provision not worked? Many blame this on the opt-out (ie the ability of workers to agree that the 48-hours maximum working week will not apply to them).

Opting out – background
Partly because of this perceived failure, the opt-out has been one of the most controversial aspects of the working time restrictions. There has been much speculation as to what the Commission would do when it reviewed the opt-out. It was thought that the Commission’s proposals may include a withdrawal of the right to opt out entirely. To the relief of many businesses, this has not come about.

The Commission has, however, introduced a number of restrictions that are likely to reduce the impact of the opt-out by making it easier for employees to refuse to opt out. As a ‘counterbalance’, the Commission proposes to extend the reference period for calculating the 48-hour maximum to a year, and hopes that this will strike an acceptable balance between protecting workers’ health and safety and enabling businesses to adapt to fluctuations in demand.

The current restrictions on opting out are:

  • An employee’s consent is required to opt out.
  • An employer must keep records of all employees who decide to opt out (national legislation only requires that records of the opt-out agreements are kept, not the actual hours worked).
  • The records must be available to the relevant authorities.
  • If an employee refuses to opt out, they must not suffer a detriment for doing so.

New proposals
The new proposals include a revised process for opting out. In businesses with employee representation, the individual opt-out will require prior collective agreement, in addition to the consent of the individual employee. Effectively, therefore, the unions may prevent employees from opting out even if the individual employee wishes to do so. If there is no employee representation, though, the opt-out will require only the employee’s individual consent.

The new proposed restrictions are:

  • The consent to opt out may not be given at the same time as the employment contract is signed, nor during any probation period.
  • Consent is limited to a maximum of one year (after which it may be renewed).
  • Employees cannot work over 65 hours a week (unless provided by collective agreement).
  • Records of hours worked by those who opt out are to be retained.
    Unsurprisingly, the Commission has retained the provision for allowing an employee to change their mind about opting out: they can, at any time, opt back in to the maximum working week by giving the required notice.

The proposals also include an extension of the reference period for calculating the average working week of 48 hours from four months to up to one year. The stated purpose for this is to enable businesses to deal with fluctuations of demand.

Likely impact
opt-out provisions are often included as part of the original contract of employment. Employees may be requested to enter into an opt-out before even starting work. With the exception of senior level employees, it is difficult in practice for employees to negotiate their terms of employment when joining a company. Many agree to opt out as part of their original employment package. The proposal not to permit employees to opt out as part of their initial contract of employment, or during any probationary period, will have a number of potential consequences. Employees will be in a stronger position to refuse to enter into an opt-out once they are established in their position and cannot be treated to their detriment for refusing to do so. This is likely to result in more employees refusing to opt out, and businesses may need to consider adjusting patterns of work to deal with the possible consequence of more employees sticking to a maximum 48-hour week, for example by increasing the size of the workforce, changing shift patterns or altering production processes. Also, as a non-intended consequence, the provision preventing employers requesting an opt-out during a probationary period may see the demise of the use of the probationary period (which does not give employers any legal protection in any event).

Employees already have the right to withdraw their consent to opt out at any time on seven days’ notice (or up to three months’ notice if there is such an agreement). However, the proposals provide that the opt-out will only last a year. An employee can refuse not to renew their consent at this time. Non-renewal of their opt-out may be considered an easier option for employees to take, rather that the positive withdrawal, as it appears less confrontational. Again, this could result in fewer employees ultimately opting out and businesses having to make adjustments to accommodate this where necessary.

Proposed record-keeping obligations, to keep records of hours worked by employees who opt out, will increase the paperwork required by businesses, adding even more
to what is already seen as the overly bureaucratic requirements of the employment relationship.

These suggested proposals of the Commission may, at last, see a reversal of the trend of the long-hours culture. If not, and these increased restrictions are not seen to be working, the current proposals are unlikely to be an end to the matter. They include a further obligation on the Commission, at a future date, to review the operation of the opt-out and propose appropriate amendments, including if necessary a phasing out of the opt-out altogether.
We may not see UK hours reduced to those of the rest of Europe, but if the opt-out is ultimately phased out altogether, the trend must surely move in that direction.

Rebecca Harding-Hill is a partner in the employment department at McDermott Will & Emery