Report highlights ROI for flexible working in frontline sectors

A new Timewise report on flexible working pilots in five frontline sectors shows that the benefits can outweigh the costs in a relatively short period of time.

health carer - smiling nurse with older woman sitting down

 

A new report on flexible working pilots in frontline sectors shows that modest investment in flexible working can be financially worthwhile in a short period and could have a significant impact on staff retention.

The third Fair Flexible Futures report by Timewise is based on trials in key frontline sectors which show that there is significant potential for flexible working, given they are starting from a low base.

It aims to address the lack of longitudinal studies quantifying the beneficial impacts of flexible
working over time and robust analysis of the financial return on investment (ROI), particularly for those in frontline sectors where margins are tight, labour is relatively cheap and easy to replace and flexible job design is challenging.

The report is based on one-year plus trials in frontline sectors, from construction and retail to care, education and health. Timewise commissioned the Institute for Employment Studies [IES] to undertake an economic analysis of the likely costs and potential benefits of flexible working interventions in frontline sectors. The IES’ analysis focused on reduced sickness absence and reduced staff turnover which are more easily measurable over a projected three-year period.

It found that:

• In retail, for a store with 200 shopfloor sales/retail staff including supervisors, the costs of the flexible working programme would be recovered within three years by a reduction in sickness absence of 16% per year. This equates to a reduction of 0.8 sick days per person per year. Alternatively, staff turnover would need to reduce by just 5% per year over three years, equating to four fewer leavers per year.
• In adult domiciliary care, for an organisation with 200 domiciliary care staff, break-even would be reached within three years by a reduction in sickness absence of 29% (1.2 days per person) per year. Alternatively, a 7% reduction in staff turnover per year would balance the costs over three years (five fewer leavers per year).
• In construction a site with 200 construction staff would require a reduction of one sick day per person per year (over three years) for the pilot to break even. Alternatively, a reduction in staff turnover of 11% per year over three years would work (equating to 7.5 fewer leavers per year).
• In teaching, Multi-Academy Trusts (MATs) with 100 teaching staff would require an average of one fewer sick day per teaching staff member per year in order for the programme to break even over three years. Alternatively, just one fewer leaver per year over three years would see the pilot breaking even.
• In nursing, for 306 staff across nine wards, a reduction in sickness absence of 0.8 days per person per year (over three years) would render the programme cost neutral. Alternatively, the reduction needed in staff turnover is 18 fewer leavers per year (out of the 46 who would usually leave).

Timewise say costs could usually be recovered sooner or with lower reduction rates, as there would be a combination of savings across the two factors. Moreover, it says, the analysis excludes other flexible working benefits that are less easy to quantify, including increased productivity, reduced presenteeism, improved progression and employer reputation.

The pilot in nursing, where unpredictable and unsocial working patterns have been shown to contribute to staff turnover, demonstrated improvements through giving nursing staff greater involvement in their work scheduling, through team-based rostering.

In construction, the research found a range of barriers to flexible working including an hourly pay structure which rewards long hours, a reliance on stretching staff resource to meet project demands and a perceived lack of career progression for people who were not prepared to work long hours. Timewise says that moving to a more output-based approach to pay, changes to how shifts are arranged and an increase in homeworking (for non-manual roles) can lead to improvements in well-being and increased productivity.

In the retail sector, the lack of flexible opportunities is perceived as a barrier to progression. Timewise’s report found that only 6-25% of promotions were awarded to part-time staff, despite 50-75% of all store staff working part time. A team-based approach to giving more advanced notice of schedules can reduce/remove the flexibility stigma and bring a measurable increase in work-life balance scores, says Timewise.

In home care, Timewise found that poor retention rates were directly linked to scheduling and the unpredictability of rotas, the absence of slack in the system, unsocial hours, downtime in the middle of the working day and the need to travel long distances between clients. It trialled a move to more advance notice of rotas coupled with a team-based, geographic approach. The pilot led to a reduction in overheads, by reducing the size of the central administration team and savings made on travel time. There was also a slight reduction in absence rates.

In teaching, Timewise found significant cultural and attitudinal barriers, as well as real administrative burdens around building timetables that adapt to flexible working arrangements. However, its pilot showed flexible working benefits included improved recruitment and retention, reduced sickness and absence rates and better management of succession planning.

Timewise says research shows a clear relationship, in all of the pilot sectors, between employees’ degree of control over their working hours (in terms of the times they start and finish their working days), and their job satisfaction. It also reports a strong correlation between low job satisfaction and high leaving intention.

The report calls on employers to create a business case for flexible working; get flexible working on the agenda of the board; consider what types of flexibility can be offered to all employees, now and in a post pandemic future; trial flexible arrangements in small teams before rolling out; appoint a team to work out the actions required to improve flexible working; integrate flexible working with wider organisational change; and establish clear metrics for tracking progress.

It concludes: “All of this suggests plenty of room for improvement in employee job satisfaction, and therefore staff retention, by increasing access to flexible hours… Only modest improvements are needed in either reduced sickness absence or reduced staff turnover for the benefits of a flexible working programme to outweigh the costs within three years. Businesses should no longer be afraid of investing in flexible working initiatives.”



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