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Public consultation Section 2: Commentary paragraphs 5-8

5. Derogations

2.5.1.  This section describes the “derogations” that are permitted and the circumstances in which they can be applied. Derogations cannot be applied without providing workers with compensatory rest to make up for any extra work they are required to do except in exceptional circumstances where, for objective reasons, it has not been possible to provide such a period of rest.The draft amending regulations extend these derogations to all non-mobile workers in road, sea, and inland waterways sectors, to sea fishing, to all workers in the aviation sector not covered by the Aviation Directive, and to all workers in the railway and offshore sectors. Derogations will apply to doctors in training, workers concerned with the carriage of passengers on urban transport services and certain workers in the rail sector.

The Government's approach

2.5.2.  When the Working Time Regulations 1998 came into effect, the Government used the permitted exceptions to provide businesses and workers with flexibilities and freedom in the organisation of working time. This approach will be adopted when implementing the Horizontal Amending Directive. In addition, employers have a general duty under health and safety law to protect, so far as is reasonably practicable, the health, safety and welfare at work of their workers.

2.5.3.  Regulations 20 to 23 of the Working Time Regulations 1998 provide for certain entitlements and limits not to apply, or to operate differently in respect of particular workers in certain circumstances.  With the exception of the emergency services and those covered by sector specific directives, there are no derogations from:

• • The Directive (or the Regulations) as a whole;
• • any worker's entitlement to a minimum period of paid annual leave; nor
• • pattern of work, such as shift patterns (unless employed in domestic service)

Unmeasured working time derogation

2.5.4.  Regulation 20 of the Working Time Regulations 1998 disapplies regulations 4(1) and (2), 6(1) and (2), 7, 10(1), 11(1) and (2) and 12(1) (i.e. the provisions creating entitlement to minimum daily and weekly rest and breaks, setting the limit for average weekly working hours and on daily hours of work for night workers) for workers:

"... when, on account of the specific characteristics of the activity in which they are engaged, the duration of their working time is not measured or predetermined or can be determined by the workers themselves ......"

2.5.5.  Workers such as senior managers, who can decide when to do their work, and how long they work, are likely to pass this test.  Those without this freedom are not.

2.5.6.  The derogation covers not only those activities whose nature means that working time is not "measured" but also activities where (on account of the specific characteristics of the activity concerned) the time it takes to do the work which they may be required to perform cannot be "predetermined", as well as situations in which the activity inherently means that the worker's working time can be determined by the worker.

2.5.7.  It is not possible to say exactly what activities would fall into the relevant category and which would not. Once again, in any disputed case concerning the application of the derogation in particular circumstances, only the courts could ultimately decide the matter.

Special circumstances

2.5.8.  Regulation 21 sets out circumstances in which the entitlements to daily, weekly and in-work rest periods, and the night work limits may be excluded subject to the worker receiving compensatory rest. The Working Time Regulations give all workers a right to 90 hours rest per week (the total of daily and weekly rest periods). Compensatory rest is a period of rest the same length of time as the period of rest that a worker has missed.

2.5.9.  The amending regulations permit derogations from the Working Time Regulations in respect of:

“Collective”, “relevant” and “workforce” agreements

2.5.10.  The definitions set out in regulation 2(1) of the Working Time Regulations 1998 also include:

1. "collective agreement", meaning an agreement or arrangement made by or on behalf of one or more trade unions and one or more employers or employers' associations, on the condition that such an agreement is with an independent trade union;

2. "workforce agreements" (see below); and

3. "relevant agreement" - a term used at many points throughout the Regulations - meaning an agreement in writing which is legally binding between the worker and employer (and which might, of course, be the result of a "collective agreement" or a “workforce agreement”).

Workforce Agreement

2.5.11.  A "workforce agreement" was a new concept when the Working Time Regulations were introduced.  It enables an agreement to be made between an employer and any workforce or part of a workforce whose terms and conditions are not set by collective bargaining, so as to allow the use of derogations provided for in the Regulations by means of an agreement made collectively but other than with a trade union, and allows for such agreements to be used to establish the way in which particular entitlements and limits are to apply to the workers covered by such an agreement.

2.5.12.  Schedule 1 to the Working Time Regulations 1998 sets out conditions and requirements which must be satisfied for an agreement to constitute a “workforce agreement” for the purposes of the Regulations. These are as follows:

1. Any such agreement must be made in writing, specifying the date from which the agreement is to apply to the workers concerned.

2. Before the agreement is signed, all those workers to whom it is to apply must be provided by the employer with copies of the text of the agreement and such guidance as they might reasonably require in order fully to understand its effect.

3. The general rule is that an agreement, which applies to all the relevant members of the workforce, should be signed by the representatives of the workforce and an agreement which applies to all of the relevant members who belong to a particular group should be signed by the representatives of the group to which the agreement applies. In either case, however, a representative who is not a relevant member of the workforce, on the date on which the agreement was first made available for signature, is excluded. In addition, if the employer employed 20 or fewer workers on that date, then the agreement is to be signed either by the appropriate representatives or by the majority of the workers employed by that employer.

4. The agreement must specify a date no later than five years after that commencement date on which the agreement will cease to have effect.

2.5.13.  If an agreement is to be made by representatives, their number may be determined by the employer. Before making a decision about such matters, it is expected that an employer would want to seek and take account of views of members of the workforce, but this is not a mandatory obligation.

2.5.14.  Any representative must be elected by votes cast by relevant members of the workforce in a properly conducted secret ballot.  So as far as reasonably practicable, voting must be in secret, votes cast be counted fairly and accurately, and each elector must have as many votes as there are representatives to be elected.  Any candidate for election must be one of the relevant members of the workforce on the date of the election, and no such member can unreasonably be excluded from standing as a candidate.

2.5.15.  Through insertions into the Employment Rights Act 1996, the Working Time Regulations protect any worker from detriment imposed by the employer because of a refusal to sign a workforce agreement.  Once an agreement is signed by the appropriate workforce representatives or individuals, however, it will apply to all members of that workforce or group of workers, whether they signed it individually or not.

2.5.16.  The use of workforce agreements may be particularly apt for small and medium size enterprises, perhaps where there are no union members among their workforce.  Agreement by signature from the majority of relevant members of the workforce may be appropriate and practical for very small businesses, with election arrangements being confined to larger ones.

Derogations available to adolescent workers

Entitlement to daily rest and to breaks - the “force majeure” derogation

2.5.17.  Regulation 27 of the Working Time Regulations 1998 makes provision for the derogation allowed in Article 13 of the Young Workers Directive.  This covers "work by adolescents" in the event of "force majeure". It is a tightly constrained derogation, under which entitlements to daily rest periods and breaks can be modified (the derogation cannot be applied to an adolescent's entitlement to minimum weekly rest period).

2.5.18.  The particular conditions which must all be satisfied are that:-

1. the need for the work concerned must arise "due to unusual or unforeseeable circumstances, beyond the employer's control", or because of "exceptional events, the consequences of which could not have been avoided despite the exercise of all due care by the employer";

2. the work required must be "of a temporary nature" and "must be performed immediately";

3. no adult worker is available to do the work in place of the adolescent or adolescents.

Daily and weekly rest period - other derogation

2.5.19.  Article 10(4) of the Young Workers Directive allows derogation in respect of daily and/or weekly rest entitlement.  Derogation may be allowed by law, provided that there are objective grounds for so doing and provided that the adolescent worker concerned is granted appropriate compensatory rest. The derogation applies to work performed in the shipping and fisheries sectors; the armed forces or the police; work performed in hospitals and similar establishments; agricultural work; tourism, hotel and catering and work which is split up over the day.

6. Paid annual leave

2.6.1.   This section sets out the arrangements for the calculation of paid annual leave. The amending regulations extend the entitlement to paid leave to all non-mobile workers in the road, sea and inland waterways sectors and sea fishing; to all workers in the aviation sector not covered by the Aviation Directive; to all workers in the rail and offshore sectors and, from 1 August 2004, to junior doctors.

Annual leave entitlement

2.6.2.  Regulation 13 of the Working Time Regulations 1998 provides both adult and young workers with an entitlement to "paid annual leave of at least four weeks", and that this period "may not be replaced by an allowance in lieu, except where the employment relationship is terminated".

2.6.3.  A typical worker working 5 days a week, would be entitled to 20 days’ annual leave.  A part-timer, working two days a week, would have a right to eight days’ paid annual leave.  If a part-timer's working time is set in terms of hours, then their annual leave might be expressed in terms of hours too. In the case of a worker working 24 hours a week it would translate to 96 hours’ annual leave.  Where a worker works irregular hours, the worker would have a right to annual leave that would allow them to be away from the place of work for four weeks and receive pay equivalent to what they might reasonably expect from a normal working week. The leave entitlement may only be taken as leave in the leave year to which it relates - though employers and workers would, of course, remain free to agree to enhance contractual paid leave to take account of any leave entitlement due but not taken for a particular year.

2.6.4.  The entitlement to paid annual leave begins on the first day of employment. However, the Regulations provide for a system of accrual during a worker’s first year of employment. This means that the entitlement accrues during the first year of employment pro rata to the proportion of the year which has been worked.

2.6.5.  Regulation 13(3) of the Working Time Regulations 1998 sets out the arrangements which will determine a worker's "leave year" - i.e. the time during which entitlement to paid leave will accrue and during which the leave must be taken.

2.6.6.  First employers and workers can reach agreement as to the date on which the leave year will start, if that is a "relevant agreement".  This could cover cases in which leave year arrangements had been so established before the draft amending Regulations came into force.

2.6.7.  Secondly, where there is no such agreement, or an agreement is terminated, "default" arrangements apply.  Under these:

1. if the worker started work with the employer before the date when the draft amending Regulations came into force, the worker's leave year would start on the draft amending Regulations' commencement date (and each subsequent leave year will start on the anniversary of that date); 

2. if the worker started work with the employer after the date on which the draft amending Regulations came into force, the worker's leave year would start on the date when the employment begins (and each subsequent leave year will start on the anniversary of that date).

Calculation of holiday pay

2.6.8.  Where a worker's entitlement to paid annual leave is paid in lieu because employment terminates during a leave year, regulation 14 of the Working Time Regulations 1998 provides the worker with a right to such proportion of their leave entitlement as is equivalent to the proportion of the leave year worked. Regulation 14 requires that an allowance in lieu be paid to a worker who has not taken this full entitlement.  The sum due in each case can be provided for in a relevant agreement. In the absence of a relevant agreement, the sum in each case should be determined by the following formula:

(A x B) - C

where:

Thus, taking the case of a worker who works five days a week who left his employer six months into the leave year and had taken only three days’ leave.

(20 x 0.5) - 3 = 7

Therefore the employer should pay the worker the equivalent of 7 days’ pay.

2.6.9.  The Government also considers that an employer should be able to make arrangements, through a relevant agreement, such as a contract of employment, to ensure a worker received an entitlement to no more paid leave than was properly due to them, i.e. an equivalent portion of the entitlement to the proportion of the leave year worked. Regulation 14(4) of the Working Time Regulations 1998 allows this to happen.

Notice Requirements

Employers and workers may agree to modify or disapply the notice requirements.

2.6.10. In the absence of such disapplication or variation, however:

1. an employer can require a worker to take all or any of the leave to which the worker is entitled under the Working Time Regulations 1998 on particular dates provided that the worker is given written notice at least twice as many days as the period of leave in question (regulation 15(2));

2. a worker is required to give written notice to the employer of intent to take up any or all of the leave entitlement, specifying the dates on which leave is to be taken (and, if only part of a day is to be taken, its duration on that day). The notice period should be at least twice the period of the leave in question.  An employer may refuse the worker permission to take leave requested. To do so, they must notify the worker within a period equivalent to the period of leave requested.

Arrangements For Determining Due Pay

2.6.11.  Regulation 16 of the Working Time Regulations 1998 sets out the arrangements that will determine the amount of pay due to a worker for any period taken as paid annual leave entitlement.  Sections 221-224 of the Employment Rights Act 1996 define what a week’s pay amounts to.  Regulation 16(4) and (5) deals with the relationship between rights to pay under the regulation and rights to pay under the worker's contract.

7. A worker's entitlement

2.7.1.  Section 45A of the Employment Rights Act 1996, provides that a worker has a right not to be subjected to any detriment by any act or deliberate omission of his employer on the grounds that the worker refused to forgo a right conferred on him by the Working Time Regulations.  An employer is also required to take any necessary measures to ensure that the worker can take up an entitlement under those Regulations.  If, however, a worker wishes to work when he is “entitled” not to, then the employer may let the worker do so subject to this not involving an otherwise unlawful act (such as posing a risk to health and safety, or ignoring an applicable limit on weekly working time).

8. Enforcement

2.8.1.  Enforcement of the Working Time Regulations is on the basis that effective implementation demands that a failure to observe the limits in respect of a worker should render an employer liable to criminal law sanctions. The Working Time Directive (93/104/EC) provides protection for workers against detriment or discrimination for refusing to work in breach of an applicable limit. In addition, employers have a statutory duty to observe the particular limits on working time.

2.8.2.  Regardless of the application and observance of particular limits on working time, it remains the case that employers have a general duty under health and safety law to protect, so far as is reasonably practicable, the health safety and welfare at work of their workers.

The proposed approach

2.8.3.  In line with existing enforcement procedures the proposed enforcement arrangements for the excluded sectors represent the "best fit" with the existing framework of law.

Offences

2.8.4.  Enforcement of the current Working Time Regulations is divided between the Health & Safety Executive (HSE) and Local Authorities. The HSE enforces the limits (weekly and night working time) and health assessments in factories, building sites, mines, farms, fairgrounds, quarries, chemical plants, nuclear installations, schools and hospitals. Local authority officers enforce these regulations in shops and retailing, offices, hotels and catering, sports, leisure and consumer services. Enforcement is in response to complaints received from individuals.

2.8.5.  We propose that, in general, the HSE and Local Authorities will enforce the Working Time Regulations as amended by the Horizontal Amending Directive. However, where more appropriate enforcement bodies exist, they may take on work that would otherwise fall into HSE’s remit; for example, the Maritime and Coastguard Agency (MCA) will enforce for sea fishermen and mobile workers on inland waterways.

2.8.6.  As with the Working Time Regulations 1998, it is proposed that the working time limits for night workers (regulations 4(1) and (2), 5(1), (2) and (6), 6(1), (2) and (6) and regulation 21 (as far as it applies where regulation 5(1), (2) or (6) are modified or excluded) and regulation 7) should be enforced in the same way as current health and safety at work legislation.

2.8.7.  Enforcement of health and safety law in particular premises is currently undertaken in accordance with good practice principles.  Those principles currently mean that enforcing officials explain to an employer what remedial action they need to take and offer the employer the right to make representations before commencing any legal action against the employer.

2.8.8.  Advice and warnings usually precede any more formal action, such as the issue of a notice requiring changes within a specified period of time.  Notices can, however, be an effective and quick means of getting employers to take necessary corrective action without delay, and without the disruption and inconvenience of having to go to court.  Appeals against a notice can be made by an employer to an Employment Tribunal.

2.8.9.  Ultimately, however, the full range of sanctions may be brought to bear against an employer acting unlawfully.  These would include, on conviction, fines and even imprisonment if a requirement imposed by an improvement notice was contravened. The sanctions in current health and safety legislation ensure that the enforcing authorities can obtain any access to premises, or information or records that they need from employers.

Complaintsand remedies available from an Employment Tribunal

2.8.10.   Regulation 30 of the Working Time Regulations 1998 enables a worker to seek redress through an Employment Tribunal where the employer is failing to comply with the entitlements to minimum daily, in-work and weekly rest breaks/periods; paid annual leave; or to provide compensatory rest.

2.8.11.  Employment Tribunals provide an informal, accessible means for individuals to assert statutory rights and protections relating to their employment.

2.8.12.  A complaint to the Employment Tribunal should be made within three months of the act or omission complained of, but this period may be extended if the Tribunal agrees that it was not reasonably practicable to bring the complaint within three months. Workers who wish to make a complaint can seek advice from the independent Advisory, Conciliation and Arbitration Service (ACAS).

2.8.13.  These rights of complaint supplement the separate remedies which could be claimed from a Tribunal if a worker is subjected to any detriment as a result of asserting due entitlement. Where a complaint is upheld, the Tribunal makes a declaration to that effect.

2.8.14.  In addition, the Tribunal could also decide to make an award of compensation by the employer to the worker. It would do so with regard to both the employer's default in refusing to permit the exercise of the worker's entitlement, and any loss sustained by the worker as a consequence of that default.

2.8.15.  Protection against detriment would cover a wide range of discriminatory actions, such as denial of promotion, facilities or training opportunities which the employer would otherwise have offered or made available.  It could even cover any excessive reduction in remuneration consequent upon a reduction in the worker's working time.  Such a reduction could also amount to breach of contractual obligations for which the worker would have a separate basis for a civil law claim.

Records

2.8.16.  In the event of a dispute between a worker and employer, the employer will be required to supply documentary evidence to the enforcing authority, to enable them to conduct a proper assessment without the need for a full hearing in court.  Regulation 9 of the Working Time Regulations 1998 requires employers to keep records that are adequate to show the limits in regulations 4(1), 6(1) and (7), and 7(1) and (2) have been complied with. This allows employers flexibility as to what records they keep as long as they are able to show that they have complied with the regulations. Employers will be required to keep records for a period of 2 years; this period is considered to provide sufficient context for considering any potential breach of the working time limit.

Civil liability

2.8.17.  The Regulations do not exclude an employer's "civil liability" in respect of the application of limits on working time required by the Regulations.  So it would be possible for a worker to sue for damages if quantifiable loss is incurred because of having had to work beyond any such limit, or because of denial of a night worker's entitlement to assessment or transfer.