What employers need to know about zero hour contracts

Alan Price – CEO at BrightHR

January 05 2016

Zero hour contracts are similar to normal contracts as they are both an agreement between two parties to perform work in exchange for remuneration, but the zero hour contracts are distinguished as they do not specify a minimum number of contracted hours. The main characteristics of a zero hours contract are that the worker is available for when you need them, you do not have to offer them any hours at all, but at the same time they are not required to accept any hours you do offer. This allows both the employer and worker to benefit from the convenient and flexible nature of the agreement. For instance, the individual can have a flexible working pattern and can fit work around other responsibilities, while the employer is not obliged to offer a certain amount of hours when work is scarce but can do in order to meet demand during busy periods. Zero hours contracts can be very appealing to employers as they can be excellent to cover unexpected events, such as temporary staff shortages during heavy demand. Employers should be aware that they should not treat workers on zero hours contracts any less favourably, as they have the same employment rights as other workers on part-time or full-time contracts, for example, all workers have the right to receive at least the National Minimum Wage and the right to annual leave. Further to that, employers should not subject workers to detriment and treat them less favourably because they have rejected work or rarely accept it. If you follow through with a disciplinary procedure for the above reason, then that might suggest that you are treating them as an employee and it is important to note that employees have additional employment rights compared to workers, e.g. the right to statutory notice. In some circumstances, those on zero hours contracts can be employees, rather than workers, because of the construction and the operation of the contract. This is usually represented by a requirement on the individual to do the work when it is offered to them. The most recent legislation on zero hours contracts has placed a ban on exclusivity clauses in these contracts. It prevents employers from limiting their staff on zero hours to work for a number of employers, as well as, them. In May 2015, any exclusivity clauses incorporated in these employment contracts became unenforceable in the courts, meaning that all zero hours’ workers were free to look for more work from different employers at the same time. For further clarification, please call our advice service on 0800 028 2420.

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