Zero Hours Contracts

The use of zero Hours contracts is on the rise. In essence a Zero Hours contract is a casual agreement for employment between an employer and an individual.

Why are they so controversial?

There is no requirement on the employer to guarantee work for the employee. The work is offered as and when it arises. Usually the employee is expected to work the shifts offered, but there is no minimum amount of work that they are assured of getting. Further a lot of recent press coverage has disclosed that employees are too scared to refuse the shifts for fear of dismissal or losing out on future offers of work. Sick pay is also rarely included in the contract.

However, protection for individuals on Zero Hours contracts is increasing all the time. The Zero Hours Contracts (Redress) Regulations have recently come into force. This legislation prevents exclusivity clauses in Zero Hours contracts.

Exclusivity clauses and their use may now result in employment tribunal claims. These clauses stops individuals from working for other organisations. However, if an individual is dismissed for seeking or taking up supplementary employment that dismissal will now be automatically unfair. In addition, if the individual suffers as a result of seeking or taking up supplementary employment they will have a claim for detrimental treatment.

Are there protections for employees?

Yes. As mentioned above, exclusivity clauses are now banned.

Further all statutory rights for both workers and employees apply to Zero Hours contracts. So for example the employer has to pay the National Minimum Wage or soon to be National Living Wage. They will also be entitled to take annual leave, rest breaks and receive protection from discrimination.

When are Zero Hours contracts appropriate for use?

Zero Hours’ contracts can be used to provide a flexible workforce to meet a temporary or changeable need for staff. Examples may include a need for workers to cover:

• Seasonal increases in demand on services, e.g. Christmas retail or music festival staff;
• unexpected or last-minute events;
• temporary staff shortages;
• on-call/bank work, particularly used in the care sector.

The contracts however should not be used if the jobs are clearly going to provide regular work for a continuous period. This type of role should be covered under the usual employment contract for permanent staff or fixed term contracts.

What are the advantages of zero Hours contracts?

For employers, they give easy access to a pool of workers to cover an increase in demand on their services. They don’t have to guarantee the work and it could be a cheaper alternative to agency staff.

For employees, the contracts allow them flexibility to meet personal requirements. It also gives them employment experience and skills.

Summary

Zero Hours contracts used in the correct way are a really useful tool for all concerned.

Should you need a contract drafting for you or have any questions please contact us.