The Working Time Regulations will come into force on 1 October 1998 and will be mirrored by separate regulations in Northern Ireland.
This summary does not attempt to cover all of the provisions of the Regulations in detail but outlines the most important provisions.
1 What are the Working Time Regulations?
The Working Time Regulations create new rights and obligations for employees and employers relating to work and recreation periods. The main provisions are:
- a limit of 48 hours on the average working week (although this can be waived by the individual)
- a limit of 8 hours on the average number of hours to be worked by night workers in a 24 hour period (in some circumstances a daily limit rather than an average)
- an obligation on employers to offer health assessments to night workers
- an obligation on employers to keep records of working hours
- minimum daily and weekly rest periods
- rest break during working hours
- paid annual leave entitlement
The Regulations also implement the provisions regulating the hours to be worked by adolescents set out in the Young Workers Directive which applies to workers over school leaving age but under the age of 18. These provisions differ from the rights given to adult workers and relate to health assessments for night work, minimum daily and weekly rest periods and rest breaks during the working day.
2 When do they come into force?
1 October 1998
3 To whom do the Regulations apply?
They apply to all workers whose contracts are in existence on 1 October 1998 or are created on or after that date.
- Workers - The Regulations apply to workers over the minimum school leaving age. "Worker" is given a wider definition than simply an employee: it covers those with a contract of employment and people who undertake work under other forms of contract (e.g. agency and temporary workers, freelancers etc.). The Regulations also apply to part-time workers and to trainees on work-experience or other forms of training. They do not apply to people who are genuinely self-employed.
- Employer - As a result of the wide definition of workers, employers can also include agencies and the "customers" of freelancers.
- Excluded Sectors - Workers involved in air transport; rail, road, sea, inland waterway and lake transport; sea fishing, other at sea (the example give by the DTI is offshore work in the oil and gas industry); doctors in training; and those involved in the armed forces, police or in certain activities of the civil protection services.
- Exceptions (NB the examples provided are illustrations only and each worker's situation should be considered separately to see whether or not a particular exception or a special circumstance applies)
- Unmeasured working time - where a worker's time is not measured or predetermined or can be determined by the worker himself. This will apply to those workers who have complete control over the hours that they work and whose hours are not dictated or monitored by their employer - for example workers who can decide whether or not to work on a particular day without the need to notify or obtain permission from their employer. Examples of those that may fall into this category are managing executives, "other persons with autonomous decision-taking powers" and family workers. Effectively these workers will only be subject to the paid annual leave provisions.
- Special circumstances - which include security and surveillance activities, activities involving the need for continuity of service or production requiring activity round-the-clock (examples may include dock work, hospital services, the provision of utilities, television, film and radio production, civil protection services and agriculture) and where there is a foreseeable surge of activity such as in tourism, agriculture or postal services.
Flexibility is afforded to this type of activity in relation to night time work, daily and weekly rest and in-work rest breaks provided that workers receive compensatory rest breaks. The provisions relating to the working week limit and holiday entitlements still apply, although the reference period for calculating averages may be extended to 26 weeks.
- Employer/Worker agreements - Collective agreements can be made with an independent trade union and "workforce" agreements can be made with workers where there is no recognised trade union. The workforce can either individually sign the agreement (where a firm employs 20 workers or less) or the workforce can elect representatives to negotiate on their behalf. A mechanism by which representatives are chosen is provided for in the Regulations.
- Force Majeure - Unexpected and unpredictable occurrences beyond an employer's control.
- Agreements to Exclude - These can only be made where the Regulations specifically allow that a particular provision can be excluded by agreement.
4 What is the Working Week Limit?
The Regulations set a working time limit of an average of 48 hours per week.
- Calculation
The standard averaging period is 17 weeks, but it can be extended to 26 weeks if the workers are covered by one of the exceptions listed in paragraph 3.4.2 above, or up to 52 weeks by agreement between employers and workers.
- Contracting Out
Individuals can voluntarily agree to disapply the weekly working hours limit. Where workers choose to do this, employers are required to maintain records of the hours they have worked. Any agreement to contract out must be subject to a notice period which can be given by the worker, subject to a maximum period of 3 months. If no provision is made in the agreement for the length of the notice period, it will be 7 days.
- Contracting out of Fixed Term contracts
The maximum 3 month notice period applies. Where the fixed term is for 3 months or less, the notice period can be made so that it is of the same duration as the fixed term, effectively contracting out the entire term.
- Workers with more than one job
Employers are required to take all reasonable steps to ensure that the workers do not exceed the 48 hour maximum - for example by requiring workers to notify on obtaining other work and, if necessary, making adjustments to the working arrangements to take account of it (for example by agreeing that the 48 hour limit be excluded).
- Record Keeping Requirements
Employers are required to keep adequate records to show that they have complied with the weekly working limit, and to show which employees have agreed to exclude it and how many hours they have worked. Employers should consider a clause in their standard contracts imposing a duty upon workers to keep appropriate time records to allow employers to comply with these requirements. In the case of hourly paid workers, employers may find that pay records are adequate for this purpose. Records must be kept for 2 years and must be available for inspection by the Health and Safety Executive.
5 How do they affect Night Work?
- Night Workers
Workers whose normal working time includes at least three hours of night time (generally 11 p.m. to 6 a.m.) on the majority of the days upon which they work or such other number of days set as a reference period either in a collective or workforce agreement or sufficiently often that they could be said to work such hours in the normal course of their work.
- Night working time limit
- Night workers whose work involves special hazards or heavy physical or mental strain are subject to an 8 hour limit in each 24 hour period.
- Other night workers are subject to a limit of an average of 8 hours in each 24 hour period, generally calculated with reference to a period of 17 weeks (the period over which the average is calculated can be extended as for the normal weekly limit).
- Health assessments
Adult night workers are entitled to an assessment (an adolescent worker to a health and capacities assessment) before being required to perform night work and at periodic intervals thereafter.
6 How long are the Rest Periods and Breaks?
- Daily
Adult workers are entitled to 11 hours consecutive rest per 24 hour period; adolescent workers to 12 hours consecutive rest per 24 hour period.
- Weekly
Adult workers are entitled to an uninterrupted rest period of not less than 24 hours in each 7 day period. This may be averaged over a two week period. Adolescent workers are entitled to two days off in each week.
- Rest Breaks during working hours
Adult workers are entitled to a minimum 20 minute rest break if their working day is longer than 6 hours; adolescent workers are entitled to a minimum 30 minute rest break if they work for longer than 4.5 hours.
Flexibility is provided for in special circumstances - e.g. industries where continuity requires that set times for breaks cannot be strictly adhered to (examples are set out at paragraph 3.4.2 above). Equally, where a shift worker's hours are split up over the day, it may not be possible for him to take the full daily rest entitlement; and when shift workers change shift, it may not be possible to take the full rest entitlement before starting the new shift pattern - in which case the entitlement to daily and weekly rest will not apply. Also in some limited circumstances the daily rest entitlement may be incorporated into the weekly rest entitlement.
7 What happens when rest provisions are disapplied or modified?
Where special circumstances are collective or workforce agreements apply and as a result the limits in relation to night work, daily or weekly rest, or in-work rest breaks do not apply or are modified, workers must:
- be permitted to take "an equivalent period of compensatory rest"; or
- in exceptional circumstances where providing such compensatory rest is not possible, be given other appropriate protection relating to their health and safety.
An equivalent period of rest should be of the same length as the period of rest which the worker was unable to take (but to which he was entitled) and should be provided within a reasonable time after the scheduled rest was due to have been taken.
Guidance from the DTI has made it clear that the flexibility afforded in "exceptional circumstances" is not something which can be used on a routine basis.
8 What Records must Employers keep?
- Generally
The requirement upon the employer is to ensure that adequate records are kept to show that the various limits set by the Regulations are being complied with. It is for each employer to determine what records need to be kept - existing record keeping provisions relating to pay and over-time may be sufficient, or new arrange-ments may have to be made in order to comply. The DTI has indicated for example that it may be sufficient, where there are stipulated standard working hours (e.g. 9 am to 5 pm) simply to use management systems to ensure that those specified hours are kept.
- Waiver of the working week limit
The records must record the identity of workers who have agreed to waive the limit and the number of hours worked.
Records must be kept for 2 years.
9 Who gets paid Annual Leave Entitlement and how much?
- Entitlement
Workers are entitled to three weeks paid annual leave (rising to 4 weeks from 23 November 1999). This is not additional to any contractual entitlement and includes bank holidays. There are transitional arrangements between 1 October 1998 and 23 November 1999 which will vary depending on the dates of the employer's holiday year.
- Qualifying Period
The entitlement does not arise until workers have been engaged for a 13 week qualifying period.
- Leave Year
This usually starts on a date set by agreement between employer and workers (and may therefore already be contained in contracts existing and continuing when the Regulations come into force). Where there is no agreement, the leave year will start on 1 October for workers already under contract on 1 October 1998 or starting contracts on that day. The leave year for workers under contracts created after that date will start on the commencement date of that contract.
- Calculation
The entitlement is calculated on the basis of 5 working days in a week. Therefore someone who works 2.5 days per week has a maximum annual entitlement of 7.5 days (increasing to 10 days from 23 November 1999).
- Notice
The Regulations set out how and when workers and employers may give notice to each other as to when leave is to be taken.
- Fixed Term Contracts
The DTI has advised that where an employer currently engages workers for a set period determinable with reference to the duration of a particular project, for example the duration of production of a film, the employer will not need to extend the term of the contract to take into account not only the project length but also the holiday entitlement accrued, as long as that contract is for a duration of less than one year and does not straddle two leave years. In order to avoid a contract of less than one year straddling two leave years, each contract should state that the relevant leave year commences on the date upon which employment under that contract begins.
- When holiday must be taken
An employer can require a worker to take all or any of the leave to which the worker is entitled at specified times, provided that the employer gives the worker prior notice of these dates of at least twice the length of the leave to be taken (unless otherwise agreed). Alternatively if the employer has an annual Christmas or Easter shutdown, it may be agreed in the contract of engagement that this will be taken as leave.
- When holiday may not be taken
The employer can also state the dates upon which holiday may not be taken. For example, an employer may require that no holiday is taken throughout the entire length of a fixed term contract (where term is less than one year and does not straddle two leave years), unless an opportunity arises during those periods when the employer agrees to holiday being taken and the worker wishes to take it (e.g. if production work stops for a period). The worker may not have been able to take any entitlement accrued by the end of the term, in which case a lump sum payment must be made in lieu of that entitlement. However, such a payment can only be made on termination of the contract.
- Carry Over
Holiday entitlement may not be carried over from one leave year to the next, nor may payment in lieu be made in respect of any leave not taken, except on termination of the contract.
10 How will this affect overtime?
Workers must not be subjected to any detriment as a result of refusing to give up a right under the Regulations.
Where a worker who has waived the 48 hour weekly limit so as to be able to carry out paid overtime subsequently gives notice to end that agreement, the employer can refuse to provide him with the opportunity to work paid overtime if there is no contractual right to be allowed to work paid over-time. The DTI has given guidance that this does not constitute a detriment.
11 How will the Regulations be enforced?
It is the employer's responsibility to ensure that workers receive the protection provided by the Regulations. The limits (e.g. the weekly working time and night work limits) in the Regulations will be enforced by the health and safety enforcing authorities e.g. the Health and Safety Executive and Local Authorities' Environmental Health Departments.
The failure of an employer to comply with any of the relevant requirements will be an offence which is punishable by imposition of a fine. If found guilty on a summary conviction (in the Magistrates' Court) the maximum fine is currently £5,000 and if found guilty on indictment (in the Crown Court) there is no limit on the amount of the fine.
In addition, failure to grant the entitlements (e.g. the rest periods and breaks and the paid annual leave) will be the subject of claims to Employment Tribunals. If denied an entitlement a worker may complain to a Tribunal within 3 months of the act or omission complained of. The time limit for bringing claims may be extended where it was not reasonably practicable to comply. If the complaint is upheld, then the Tribunal will make a declaration to that effect and may make an award of compensation against the employer. The Regulations do not give any guidance as to the basis upon which compensation will be calculated although the DTI has stated that the Tribunal will look both at the employer's default in refusing the entitlement and any loss which the worker may have suffered as a consequence.
12 What steps should an employer consider taking?
Detailed practical guidance and legal advice will differ from employer to employer depending upon the type of work carried out, the terms of the contracts under which workers are engaged and any existing record keeping or regulatory systems.
However, it may be advisable to:
- carry out a workforce and systems audit to check what extent the current systems comply with the requirements of the Regulations, for example in relation to rest breaks and in-work rest periods, and to assess what changes will need to be made;
- check existing and standard contracts for the amount of holiday entitlement and requirements in relation to working hours;
- ascertain whether there are adequate record-keeping systems in place in order to comply with the Regulations, in particular in relation to exclusion or application of the 48 hour weekly working limit;
- consider agreements excluding the weekly working limit in relation to existing contracts and amendments to include provision for such agreements in standard contracts; and
- consider carefully to which workers an exclusion of the working weekly limit may need to apply and exercise caution when implementing or negotiating any exclusion agreements in view of the broad scope of the regulation stating that workers may not suffer detriment as a result of refusing to give up a right under the Regulations.
13 What further employment legislation is expected?
The Working Time Regulations are part of a package of protective and regulatory measures resulting from the implementation of European directives. The majority of the remaining provisions will be implemented in two pieces of legislation: the Minimum Wage Act, which was given royal assent on 31 July 1998 and will be implemented in due course by Statutory Instrument; and the Fairness at Work proposals which are still under consideration but which are expected to come into force in the summer of 1999.
The Regulations are available from Her Majesty's Stationery Office (HMSO) and from The Stationery Office Ltd Bookshops. Guidance to the Regulations and answers to "Frequently Asked Questions" can be accessed at the DTI website at http://www.dti.gov.uk/workright
This article was first published by Marcfarlanes in October 1998.
This note is intended to provide general information about some recent and anticipated developments which may be of interest. It is not intended to be comprehensive nor to provide any specific legal advice and should not be acted or relied upon as doing so. Professional advice appropriate to the specific situation should always be obtained.
If you would like further information or specific advice, please contact one of the following partners: Tony Thompson, Willie Manners or Andy Millmore; or any other member of the Employment Group.