Flexible working and talent: What businesses need to know

For many employees, flexibility in when, where and how they work now ranks alongside pay and job security as a deciding factor when choosing an employer. For small and medium-sized businesses competing for talent against larger organisations, this shift presents both a challenge and an opportunity.

While there are many forms of flexible working arrangements adopted by organisations, some of the most common arrangements include flexitime which allows employees to choose start and finish times within set limits; job sharing where two or more share the responsibilities of a single role; and remote or hybrid working arrangements which give employees the autonomy to choose when to work remotely or from the office.

By using flexible working effectively, businesses can attract and retain talent and gain competitive advantage. Organisations that fail to adapt risk missing out on wider benefits, including improved productivity, wellbeing and access to a broader talent pool.

Since 6 April 2024, employees in the UK have the statutory right to request flexible working from the first day of employment. Previously, employees needed 26 weeks of service before making such a request. Workers can now submit up to two statutory requests within a 12-month period, and employers must consider these requests reasonably and respond within two months.

Employers are not obliged to approve every request, but refusals must be based on legitimate business reasons such as cost, operational disruption or an inability to reorganise work. Mishandling requests, however, can expose businesses to employment tribunal claims.

The business case for flexibility is increasingly clear. Research from the CIPD suggests that around 3% of employees have left their jobs because flexible working was unavailable – equivalent to roughly 1.1 million workers across the UK. For SMEs, the cost of replacing even one experienced employee can be significant once recruitment, onboarding and lost productivity are taken into account.

The research also shows that 33% of employees believe it has had a positive impact on their career prospects, suggesting it plays a key role on career progression. This can help provide opportunities for a wide range of employees who may otherwise face barriers to progression, such as employees with childcare and family responsibilities. These findings position flexible working as a strategic driver of organisational commitment, engagement and performance.

Despite its advantages, flexible working also presents challenges that organisations must manage carefully. One of the most common challenges is managing remote or hybrid teams functioning across different locations, schedules and working patterns. Without clear structures and support, there is a risk of poor communication, reduced productivity and lack of team collaboration. There is also the possibility of employees experiencing feelings of isolation, where they do not feel a sense of belonging to their team or the wider organisation. This calls for employers to actively foster inclusion and wellbeing. Practical actions may include regular one-to-one check-ins, team-building activities and raising awareness of available mental health and wellbeing services. Importantly, effective leadership is critical.

Managers play a key role in the success of flexible working practices. They should be appropriately trained in building cultures of open communication, fairness and trust. Without the right leadership capabilities and organisational support systems in place, it would be very difficult to experience the long-term potential of flexible working.

Flexible working is no longer simply an employee perk; it has become a structural feature of the UK labour market. For SMEs competing for skilled staff, the question is no longer whether flexibility should exist, but how it can be implemented in a way that supports both employees and business performance.

Organisations that treat flexible working as a strategic tool rather than a compliance exercise will be better positioned to attract talent, retain experienced staff and build resilient teams in an increasingly competitive labour market.

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