Flare compresses the shadows. It usually has little effect on highlights because the ratio of flare (which is a uniform, non image forming light striking the negative) to highlight is so small. The ratio of flare intensity to shadow is pretty large, in fact it could be larger than unity in the sub zone I area. So most of the effect is in the shadows.
There was an extensive thread on the effects of flare on exposure index this recently. The thread is difficult to read but summary as follows;
View 1: Flare causes pre-exposure in the shadows and can augment film sensitivity (speed) and makes the system faster.
View 2: Flare compresses shadow tones, thus decreasing separation. Film speed is determined by separation of tones (Speed point is 0.3 x G which is an instantaneous gradient) and thus flare makes the system slower.
My Conclusion: One can choose a film-speed definition to satisfy View 1 or View2.
Here is a typical tone reproduction curve, showing a typical flare curve.
(Image from an S. Beskin post)