Zero hours workers

Overview

Jane Klauber, Russell-Cooke Last Modified  11 January 2016

  • Zero hours contracts do not have a specific definition in law - contracts referred to as "zero hours contracts" may differ from one organisation to another.
  • Zero hours staff may be engaged as employees or workers. A zero hours worker's employment status will depend on what the contract says and how the arrangement operates in practice (i.e. whether the legal tests of employment are met).
  • Employment status is important because it determines an individual's legal rights and an employer's obligations towards that individual.
  • Employers should decide how the relationship will operate in practice, apply the corresponding employment status and accurately reflect this in the contract.
  • Contracts should specify the employment status, rights and obligations of zero hours staff and confirm basic terms, including pay, holiday entitlements, notice and other terms which relate to the way work will be managed.
  • Employers should regularly review working arrangements to assess whether the way in which individuals are working has implications for their employment status. If their status has changed, the employer should consider issuing a new contract to reflect this.

Recent developments

Legal remedy against exclusivity clauses
Exclusivity clauses in zero hours contracts, used to tie workers into working for only one employer even when no work is offered, became unenforceable in May 2015 under the Small Business, Enterprise and Employment Act 2015.

From 11 January 2016, the Exclusivity Terms in Zero Hours Contracts (Redress) Regulations give zero hours employees the right not to be unfairly dismissed for failing to comply with an exclusivity clause, and zero hours workers the right not to suffer detrimental treatment for working elsewhere. The unfair dismissal protection will be a ‘day one’ right – employees won’t need the usual two years’ service to claim it.

The government has also produced new guidance for employers on zero hours contracts dealing with when it’s appropriate – and inappropriate - to use them, the employment rights associated with them, suitable alternatives to them and exclusivity clauses.