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Balancing flexibility for the employer and the employee: a case study of the development of annualized hours employment contracts.

As with many forms of flexible working, Annualized Hours (AH) systems offer potential benefits to both the employer and the employee. However, the flexibility requirements of employers and employees often conflict. Therefore, when a large food manufacturing organization decided to redesign its AH system, it employed an independent consultancy to act as neutral third party. The consultancy provided technical expertise and assistance in developing an AH system that optimised productivity and was acceptable to the workforce. Data are presented, obtained from focus groups conducted throughout the organization, describing some of the potential difficulties of implementing an AH system. Drawing upon these data, a number of new AH systems were proposed and modelled using specialist software tools. The design process is described, together with the advantages and difficulties associated with use of the software tools. It is concluded that the key elements in the process of designing AH systems are centred around issues of trust and communication; the involvement of a broad range of interested parties, through a process of carefully managed group facilitation; and the need for adequate technical support in the development and evaluation of AH systems.