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Zero-hours contracts: Will you have to call an end to them?

If you currently employ staff on zero-hours contracts then you’ll undoubtedly be following the news with interest as to whether these will soon become a thing of the past.

Whilst zero-hours contracts can seem unfair in some circumstances they make perfect sense for both employers and their staff in others. For example, where people just want to work a few hours in a shop over the Christmas period to get extra cash. With the employer benefitting from flexible staffing to cater for seasonal demand, and the employee not having to commit to working a minimum number of hours, this can be win-win all around.

But unfortunately, some employers have been seen as trying to avoid their proper obligations by using zero-hours contracts where a permanent contract would have been more appropriate.

As a result, the Zero Hours Contracts Bill 2013-2014 has now been presented to Parliament with a view to making it illegal to offer zero hours contracts.

What is more, if the Bill is passed, existing zero-hours contracts would become void and employers will have to offer these staff a contract of employment that gives them fixed and regular working hours.

This is a Private Member’s Bill that is only due to having its second reading debate on 28 February 2014. Although only a small minority of Private Member’s Bills become law, by creating publicity around an issue, they often affect legislation indirectly…so watch this space.

Exactly what sort of contracts is it looking to prevent?

Section 1(3) of the Bill defines a zero hours contract as “a contract or arrangement for the provision of labour which fails to specify guaranteed working hours and has one or more of the following features:

  • it requires the worker to be available for work when there is no guarantee the worker will be needed;
  • it requires the worker to work exclusively for one employer;
  • a contract setting out the worker’s regular working hours has not been offered after the worker has been employed for 12 consecutive weeks.”

Working exclusively for one employer

The restriction on exclusivity will not apply in cases where the employer can demonstrate a compelling business reason to justify it, such as confidentiality requirements.

Why 12 consecutive weeks?

This feature has been added to the definition so employers that genuinely need zero hours staff on a temporary basis, say for the Christmas holidays or the fruit picking season, will not be forced into a more formal arrangement with staff.

What it is designed to prevent is employers keeping staff indefinitely on zero-hours contracts when they should be giving them a contract for regular working hours.

If you need any further assistance please contact a member of our Employment & HR team.

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