NEWS
RELEASE

It will publish a report showing that employers need to keep the freedom to ask their staff to opt out of the weekly hours limit, set out in the EU working time directive.

The European Commission will review the individual's right to opt out by November this year, raising fears of another increase in labour regulation.

The report reveals the findings of a CBI-Pertemps survey of 400 UK firms of which 60 per cent said removal would have "a significant or severe" impact on business.

Companies said it would also undermine their ability to meet customer needs, respond to demand or launch new commercial ventures.

Digby Jones, CBI Director-General, has written to Chancellor Gordon Brown and Trade Secretary Patricia Hewitt warning that the issue is "the next test of the government's stated commitment to labour market flexibility."

He highlights Mr Brown's pledge to "resist inflexible barriers being introduced into directives like the working time directive" (Speech to Centre for European Reform, 10 March).

Digby Jones, who spent yesterday in Brussels lobbying on the issue, also accuses trade unions of misrepresenting their members by campaigning for further restrictions on hours.

The CBI report says there is no evidence that a significant number of employees want to lose the opt-out and some firms believe removal will cause staff resentment.

Many professional staff work long hours because of willing commitment to their jobs, while many operational staff would be angered by the loss of overtime.

The report suggests that 18 per cent of staff regularly use an opt-out in companies from all parts of the economy, with the greatest use among smaller firms.

Digby Jones said: "This is about choice. People should have a right to say 'no' to long hours and the directive rightly gives them that protection. But they don't want unions and politicians telling them when they can work or for how long. That would be the over-zealous interference of the nanny state.

"Further restrictions on working time would be a kick in the teeth for many firms, particularly smaller ones. The move would inflict serious damage on our highly successful flexible labour market by increasing costs and exacerbating skills shortages.

"There is a genuine concern among employers and employees that Brussels wants to prevent people having the freedom of choice to work longer hours and earn more money if they want to. The loss of the opt-out would seriously call into question the Commission's commitment to EU competitiveness."

The CBI report makes clear that coercing employees to sign opt-outs is "totally unacceptable", but it says union claims of widespread abuse are exaggerated.

DTI research has uncovered little evidence of a problem and ACAS has received few complaints. In addition, the European Commission has failed to find evidence of a link between use of the opt-out and workplace accidents.

The CBI report illustrates the range of practical difficulties that companies may face through a series of case studies.

Firms may have to cut services or increase staffing, with the cost of recruitment, training and equipment hitting their ability to invest in new plant or jobs. There could also be employee relations difficulties as work patterns change or staff ask for higher pay to replace lost overtime.

The CBI says the UK uses the opt-out more extensively than other countries because contracts tend to be agreed individually rather than collectively. Other states make use of provisions allowing collective workforce agreements, with hours averaged over a year.

Digby Jones said: "EU-wide employment law will cause damage unless it reflects national differences. There is no reason why we should be penalised for being different. This is not about special treatment for the UK but equivalent treatment."

The government introduced the working time directive in 1998. In addition to working hours, it sets minimum standards on holiday entitlement, holiday pay and rest breaks.