Is fractional work a threat or a productivity opportunity?

By Victoria Stuart and Stephanie Reuss

The laws keep changing. And it often seems as if the balance of power is shifting more and more to employees.

The decision last week by the Fair Work Commission to require employers to justify decisions relating to flexible working conditions may feel like another one of these instances. It might feel like yet another legal risk for small business owners.

As small business owners, we completely understand any top-down directive seems like an intrusion on the way we do business. These decisions seem like more red tape.

But what if these changes are actually the impetus for small businesses to embrace a more productive workforce, and to future-proof their businesses?

No doubt this legislation, which requires employers to reject requests for flexible work in writing, is driven from the employee side. Many employees (94% of them, in fact) want more flexible working arrangements, but many aren’t getting them.

“Significant unmet employee need” is how the full bench put it.

And talent is the number one driver of business growth. So as business owners we need to get ahead of these changing preferences. If we don’t adapt, we won’t win, or retain, the best talent.

So what’s changed?

We’ve seen a convergence of preferences and trends towards fractional work — fractions of the traditional 40-hour work week. In fact, while the new clause is aimed mostly at parents and carers, many people want and need flexibility for a huge number of reasons: health, starting a business, funding a professional sporting career, people scaling back slowly to retirement, caring for a sick or elderly loved one. There is a proliferation of different types of workers who are seeking fractional work.

And of course, there are millennials. By 2025 they’re predicted to represent 75% of the workforce, and one of their top priorities is flexibility. A Deloitte study showed 75% of millennials consider a “work from home” policy important.

In the future, when automation impacts our workforce and parts (but not all) of jobs are automated, what other way is there than fractional work, to retain people’s skills and knowledge in our businesses?

Work will only become more flexible in the next decade. Responding to it early presents a significant advantage.

Fractional work will soon become the norm

Creating a business environment that embraces flexibility — and which makes flexibility work in a way that is efficient and encourages good culture — is future-proofing, pure and simple.

So what to do?

• When someone requests to work part-time, re-scope their role. Look at how you can divide the work into fractions: can some be automated, re-distributed across the team or given to a new part-time employee?
• If you’re struggling with retention issues or engagement, you might proactively raise part-time in management conversations. Part-time workers have been proven to be more productive, engaged, loyal (staying on average one year longer) and produce higher end-customer satisfaction.
• If you’re looking to attract the best talent, salary is one lever and flexibility is another.
• Think about your budget in a new way. Introducing fractional work allows employers to afford a more senior person for their budget.
• Use fractional work as a way to hire more people and gain multiple skill sets or specialists, as opposed to one generalist. This is a massive win in a situation where choosing your next hire (and potentially ruling out your ability to hire other skills) can be paralysing. We’ve been there!

Flexibility challenges norms — in the best way

Just as when the 40-hour work week was introduced, there can be a discomfort about ‘how to get the work done’.

But as the New Zealand firm Perpetual Guardian showed with its four-day work week trial, fewer hours can sometimes yield surprising outcomes like increased productivity and efficiency. Lower staff stress and better performance were also a win. (Though paying five days’ pay for four days worked might seem too steep a price for many employers!)

Flexibility requires innovation and thinking differently, both of which are vital for healthy businesses. There are experts out there to help you — in a way that drives productivity and performance.

So what might at first seem like a whole new legal risk, might actually be an opportunity to work smarter, not harder.

Victoria Stuart & Stephanie Reuss are co-chief executives and co-founders of online talent marketplace Beam Australia.

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