Term Time Working
Term Time Working Arrangements In SMEs
Term time working can be an effective way of supporting employees with school age children. However, grandparents involved in childcare may also wish to scale back their working time to have the school holidays as time off. Term time working arrangements might also appeal to some employees without childcare responsibilities (for example the spouse of a teacher looking to enjoy more time off with their partner). However, for small and medium-sized businesses, they can present operational, resourcing, and cost challenges if not managed carefully.
Your business model may also require term time working arrangements, for instance if your employees work in an education environment you will only want them to work and be paid during term time.
This guidance explains what term-time working is, how requests should be handled, and the key legal and practical issues SME owner-managers need to consider before agreeing to such arrangements.
What Is Term Time Working?
Term time working is a form of flexible working where an employee works only during school term times and does not work during some or all school holidays. It is most commonly associated with parents, but requests may also come from:
- Grandparents involved in childcare
- Employees whose partners work in education
- Employees seeking greater work-life balance
Term time working is not an automatic right. It is a request that must be considered properly, rather than something employers are required to grant.
Benefits of Term Time Working
Term time working can offer advantages for both employers and employees. Whilst it will not be suitable for every role or business, it can be an effective way of attracting and retaining experienced employees who require greater flexibility around school holidays.
- Improved recruitment – Term time working can help attract candidates who might otherwise be unable to commit to a traditional year-round working pattern.
- Better retention – Employees who are able to balance work with family or personal commitments are often more likely to remain with the business long-term.
- Reduced absenteeism during school holidays – A structured term time arrangement can reduce the need for ad-hoc annual leave requests and unplanned absences during school holiday periods.
- Improved employee wellbeing – Additional time away from work can help employees maintain a healthier work-life balance and reduce stress associated with childcare arrangements.
- An attractive benefit for experienced employees – Term time working may appeal to skilled employees who are considering reducing their working commitments but whose experience remains valuable to the business.
For many SMEs, a well-structured term time working arrangement can provide a practical compromise between meeting operational needs and supporting employee flexibility.
Challenges of Term Time Working
Whilst term time working can provide significant benefits, it can also create practical challenges for employers. Before agreeing to an arrangement, businesses should carefully consider how the employee’s absence during school holidays will affect operations.
- Cover during school holidays – The business must ensure there are sufficient resources available during periods when the employee is not working.
- Increased pressure on other staff – Colleagues may be required to absorb additional work during school holiday periods, potentially affecting morale if arrangements are not managed carefully.
- Recruitment of temporary cover – In some roles it may be necessary to recruit temporary workers or provide overtime to existing staff, which can increase costs.
- Customer service implications – Reduced staffing levels may affect response times, service delivery or customer satisfaction if adequate cover is not available.
- Administrative complexity – Contracts, working patterns, holiday entitlement, payroll arrangements and annual term dates all need to be managed accurately.
For SMEs, the key question is whether the benefits of the arrangement outweigh the operational challenges. This will depend on the nature of the role, the size of the workforce and the flexibility available within the business.
Practical Example
Sarah works 37.5 hours per week during term time only and does not work during the six-week summer holiday. Her annual salary is calculated based on the weeks worked and paid in 12 equal monthly instalments.
Who Can Request Term Time Working?
A request for term time working is treated as a statutory flexible working request.
To be eligible, the employee must:
- Be an employee (not a worker or contractor)
- Have made no more than two flexible working request in the previous 12 months
Dealing With A Term-time Working Request
An application to work term-time only is essentially a request for flexible working and can therefore be made by any employee from day one of employment.
When in receipt of a flexible working request you, as the employer, you must:
- Consider the request in a reasonable manner
- Deal with it within the statutory timeframe (currently three months, unless extended by agreement)
Best Practice for SMEs
- Meet with the employee to discuss the request
- Explore how the arrangement might work in practice
- Consider alternatives if the exact request is not workable
- Confirm the outcome in writing
If the request is approved, it will usually result in a contractual change, meaning the employee’s contract should be updated or varied in writing.
When Can a Term-Time Working Request Be Refused?
Employers may refuse a request for one or more of the statutory business reasons, including:
- Additional costs
- Inability to meet customer demand
- Difficulty reorganising work among existing staff
- Inability to recruit additional staff
- Detrimental impact on quality or performance
- Insufficient work during the proposed working periods
- Planned structural changes
For SME owner-managers, it is important to clearly explain:
- Which reason(s) apply
- Why the arrangement would not work for the business
- The practical impact on operations or costs
Employment Rights Act
SMEs should be aware that the Employment Rights Act will introduce a requirement for the employer to explain, in writing, why their refusal is reasonable i.e. justify the reason(s) they are relying on for refusal. The change is scheduled to be introduced during 2027.
Appeals
Although there is no strict legal requirement to offer an appeal, ACAS guidance recommends allowing one. Offering an appeal:
- Demonstrates fairness
- Reduces the risk of disputes
- Provides an opportunity to revisit the decision if circumstances change
Any appeal should be handled reasonably and within the overall statutory timeframe.
Avoiding Discrimination Risks
From the employee point of view the right is simply to be able to request flexible working and the employer has a duty to consider the request fairly. The legislation, as already outlined, provides reasons an employer can rely on to refuse a request. It is generally women who have responsibility for childcare arrangement and therefore most requests for term time working are likely to come from women who want to find a compromise between work and childcare arrangements. Therefore, refusing a request can sometimes give rise to indirect sex discrimination claims.
To ensure there is no risk of discrimination a decision to refuse a request for term time working should not be rushed:
- Avoid blanket bans on term-time working
- Assess each request on its individual merits
- Ensure decisions are based on genuine business needs
- Keep clear written records explaining your reasoning
Indirect discrimination may be justified, but only where the decision is a proportionate means of achieving a legitimate business aim.
Practical Considerations for Term Time Working in SMEs
Term time working arrangements can take different forms, such as:
- Working during term times only (roughly 39 weeks of work and 13 weeks of no work
- Not working during summer holidays only (6 weeks of no work)
- Working some school holidays but not others for instance they may have the main holidays off but work through the half term weeks
Any agreed arrangement should be clearly documented, including:
- The total number of weeks they are expected to work each year.
- Which weeks the employee will work.
- Which weeks will be non working weeks
- Details of any weeks when the working pattern will be variable for instance during half-terms they may work a reduced week.
- When and how term dates must be confirmed.
Many SMEs require employees who have a term time working arrangement to notify them of term dates for the next academic year before the end of the current academic year to support planning.
Hours of Work and Annualised Hours
Term time workers often work full-time hours during term time, but where you and your employee have agreed a more fluid working pattern you may consider using an annualised hours arrangement, where:
- Total working hours are calculated across the year
- Core hours are worked at agreed times
- Flexible hours are worked as required
Employers must still comply with Working Time Regulations, including the 48-hour weekly limit unless the employee opts out.
Pay Arrangements for Term-Time Workers
The most common and practical approach is for term time workers to be paid in equal monthly instalments. This approach provides a consistent income throughout the year, including school holidays for the employee and simplifies payroll administration for the employer.
Holiday Entitlement and Term-Time Working
Holiday entitlement for a term time worker is pro-rated based on hours and weeks worked in the year. The 12.07% accrual method is regularly used for these workers.
In practice holiday entitlement is usually taken during school holidays with any additional time off beyond holiday entitlement taken as unpaid leave. The statutory holiday entitlement of 5.6 weeks accrues during the paid weeks. You may choose to limit the entitlement to the 5.6 weeks but can top that up to continue to accrue during the unpaid weeks. If you do that the additional entitlement would be regarded as company rather than statutory entitlement and can be dealt with outside the statutory rules.
Most term time working arrangements involve working during term time and taking holiday entitlement or unpaid leave during non term weeks. Therefore the majority of arrangements prevent holiday being taken during term time. Whether you will allow holiday to be taken during term time or not there should be clear agreement in advance of the working arrangement starting to avoid disputes later.
Common Mistakes Employers Make
Term time working can provide valuable flexibility for employees whilst helping employers retain experienced staff. However, problems often arise when arrangements are agreed informally or requests are handled inconsistently. Avoiding the following common mistakes can help ensure term time working arrangements are fair, practical and sustainable.
- Assuming only parents can request term time working – Whilst many requests come from parents with school-aged children, any eligible employee can make a flexible working request. Requests should be considered based on their merits rather than assumptions about an employee’s personal circumstances.
- Agreeing arrangements without updating contracts – Term time working changes an employee’s working pattern and, in many cases, their pay arrangements. Employers should ensure that any agreed changes are clearly documented and reflected in the employee’s terms and conditions.
- Failing to define working and non-working weeks – Uncertainty about which weeks an employee is expected to work can lead to confusion and disputes. Term dates, inset days, holiday periods and any exceptional arrangements should be clearly agreed from the outset.
- Not considering holiday entitlement properly – Holiday entitlement for part-year workers can be complex. Employers should ensure that holiday calculations comply with current legislation and are applied consistently.
- Applying different standards to different employees – Similar requests should be assessed using the same criteria. Inconsistent decision-making can damage employee relations and increase the risk of discrimination claims.
- Refusing requests without evidence – Employers can refuse a term time working request where there is a genuine business reason for doing so. However, decisions should be based on evidence and operational requirements rather than assumptions or personal preference.
Taking time to properly assess requests, document arrangements and communicate decisions clearly will help employers avoid many of the problems commonly associated with term time working.
Consistency Matters
Term time working requests should always be considered on their individual merits. The impact on the business may differ depending on the employee’s role, the size of the team, customer demands and the availability of alternative cover arrangements.
However, whilst each request should be assessed individually, employers should apply a consistent decision-making process. Similar requests should be evaluated using the same criteria and decisions should be based on objective business factors rather than assumptions or personal preferences.
Consistency is particularly important where requests are linked to childcare responsibilities. Women continue to undertake a greater proportion of childcare responsibilities than men and are therefore more likely to request arrangements such as term time working. Refusing requests without proper consideration, or applying different standards to different employees, could increase the risk of indirect sex discrimination claims.
Keeping clear records of requests, the factors considered and the reasons for any decision will help demonstrate that requests have been handled fairly, reasonably and consistently.
Even where a request cannot be accommodated, employees are more likely to accept the outcome when they understand the reasons behind the decision and can see that a fair process has been followed.
Key Tips for SME Owner-Managers
- Consider requests individually and document decisions carefully
- Be alert to discrimination risks
- Ensure contracts clearly reflect agreed arrangements
- Seek advice before refusing complex or borderline requests
Related Articles
- Flexible Working Requests
- Annual Leave Entitlement Explained
- Employees Cannot Get To Work
- Induction and Onboarding
- Probationary Periods
- Managing Employee Absence
Need Support?
Term-time working arrangements can be difficult to structure, particularly in small businesses where cover and flexibility are limited. Taking advice before agreeing terms can help you avoid disputes, ensure compliance, and protect your business.
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