Working time opt-out must go, says European Parliament

The decision rejects the proposal put forward by the European Commission in September, which would have kept the right of opt-out while tightening the conditions for its application. Sir Digby Jones, Director-General of Britain's CBI, said it will allow emerging economies like China and India to "walk all over us."

Background

The Working Time Directive currently provides that workers in all sectors, public or private, must not work longer than 48 hours a week, including overtime. The Directive also specifies requirements for rest periods, breaks and no less than four weeks' paid holiday per year. Its aim is to protect workers from the health and safety consequences of overworking.

In 1993, the UK negotiated an opt-out which allows Member States not to apply the limit to working hours under certain conditions: prior agreement of the individual; no negative fall-out from refusing to opt-out; and records kept of working hours of those that have opted out.

While the UK is the only country to have made extensive use of the opt-out, France, Germany, the Netherlands, Spain and Luxembourg are preparing or have passed legislation to make restricted use of the opt-out, in certain sectors.

The opt-out, and in particular the UK's use of the opt-out, was one of the main concerns raised in a Commission report into the operation of the Directive and led to the Commission putting forward proposals in September for a new Directive to amend the existing Directive which would restrict the opt-out.

The vote

Yesterday, MEPs voted that the Commission's proposals did not go far enough. Instead, the Parliament adopted a report by Spanish MEP Alejandro Cercas, calling for the opt-out to be scrapped after three years, by 345 votes to 264 with 43 abstentions.

The MEPs also approved a proposal for all hours where an employee is "on-call", even the "inactive part", to count as working time in most cases.

The MEPs agreed in general with the Commission's proposal to extend the reference period over which the average working week is calculated from four to 12 months, but they strengthened the conditions. The MEPs demanded either a collective agreement or, in cases where workers are not covered by collective agreements, a mechanism whereby workers have to be consulted in an appropriate way and measures have to be taken to prevent any health and safety risks.

In further amendments to the Commission's text, MEPs decided that working hours should be organised in such a way as to give employees the opportunity for life-long learning.

They also wanted to achieve the right balance between reconciling work and family life and the need for more flexible organisation of working time. In addition, MEPs wanted to make it clear that the Directive covers workers who have more than one employment contract.

What's next?

The Commission is due to publish its response to the amendments by 2nd June, in time for a Council of Ministers' discussion on the issue on 3rd June. Negotiations over the proposals are expected to be intense, and the Council of Ministers is not expected to make a decision on the revised Directive for some time.

The British government is under great pressure to ensure that the opt-out continues; but its bargaining position has been weakened by yesterday's large anti-opt-out vote – which included several Labour MEPs. However there are signs that it may be able to garner sufficient support from the newer Member States to prevent the opt-out being scrapped altogether.

Industry's response to the vote

UK business leaders were united in their condemnation of the vote yesterday.

Sir Digby Jones, Director-General of the CBI, said:

"The Parliament has just voted to take Europe's economy backwards. If implemented, this Directive would restrict the UK's highly flexible labour market, and undermine the EU's declared aim to become the most competitive economy in the world by 2010. If we allow Britain's economy to become hidebound in this way, emerging economies like China and India will walk all over us."

He called on the Government to ensure that the flexibility engendered by the opt-out continues for the future.

The Chartered Institute of Personnel and Development (CIPD) added its voice in favour of the opt-out, citing research showing that individual choice is the main driver behind long hours working.

In its opinion, employer abuse would be better tackled through increased enforcement and increased awareness on the part of employees, and Ben Wilmott, Employee Relations Adviser with the CIPD, urged the government to promote flexible working arrangements as a solution to the problem.

"While we don't discount the problems that long hours working can create, we believe that this is the wrong way to address the issue," he said.

In contrast, the Trades Union Congress welcomed the vote, with General Secretary Brendan Barber calling it "a victory for a common sense compromise on the 48 hour working week."

He explained:

"Today's employer rhetoric about choice fails to convince. UK employers have had nearly a decade to implement a system free of abuse that gave staff a genuinely free choice. But research shows that less than half the workforce even know they have a right not to work more than 48 hours a week, and that two out of three who work more than 48 hours a week have not been asked to sign an opt-out. Of course some employers rigorously follow the rules, but these figures show a large number cannot be trusted not to ignore or abuse the rules."

Robyn McIlroy, an employment specialist with Pinsent Masons, the law firm behind OUT-LAW.COM, commented:

"While the European Parliament voted yesterday to end the opt-out, the ultimate decision will rest with the European Council when it meets in June. Certainly many employers will be concerned at the prospect of losing the flexibility that the opt-out provides.

"It has become almost routine in many sectors to request that employees sign a form agreeing to opt-out of the maximum limit on working hours and indeed according to a recent survey produced by the Institute of Directors over 40% of all UK firms have made use of the opt-out. In addition, research by the CIPD shows that over 75% of long hours workers say that they do so as a result of their own choice.

"The fact is however that far from being pressured by employers into agreeing to work longer hours, many employees see the benefit of agreeing to opt-out, particularly in, for example, the construction industry where they do so in order to earn lucrative overtime. Removing the opt-out may help in leading the UK away from the so called 'long hours culture' but any measure which restricts the competitiveness of UK businesses must also eventually impact on salary levels and possibly even job security."