Increasingly companies are employing staff on zero-hours contracts. This is where employees have no guaranteed hours or times of work and they agree to be available for work as and when required. This arrangement can provide employers with a pool of staff who can be used when the need arises.
Zero-hours contracts can play an important part in the labour market where properly used as they provide flexible employment in job roles where open-ended contracts are unsuitable.
However, this type of contract will not suit everyone and employers should keep this in mind when looking to attract the right people. They may suit people who want occasional earnings and are able to be entirely flexible about when they work but the unpredictable nature of working times means that they won’t be for everyone. If you are considering taking on staff on a zero-hours basis, it’s important to be aware of your responsibilities as an employer and to set out the terms of any contract clearly. The Government’s summer review into zero-hours contracts was conducted in August 2013. It identified 2 clear concerns, both supported by recent ACAS research:
- The use of exclusivity clauses, which prevent an individual from working for another employer, even when no work is guaranteed.
- Lack of transparency and information on the employment contract, leaving individuals unaware of their rights
Following on from the 2013 consultation, the Business Secretary has also committed to the following action:
- Consulting further on how to prevent rogue employers evading the exclusivity ban, for example through offering 1 hour fixed contracts.
- Working with business representatives and unions to develop a code of practice on the fair use of zero hours contracts by the end of 2014.
To that end, the following are areas employers should keep in mind when considering taking on staff on zero-hours contracts:
- Business Secretary Vince Cable has announced plans to ban exclusivity clauses in zero-hours contracts.
- You are not obliged to offer work to workers on zero-hours contracts, but equally, they are not obliged to accept any work you offer.
- It is also important to be aware of the provisions of the National Minimum Wage Regulations, which state that workers on ‘stand-by time’, ‘on-call time’ and ‘downtime’ must still be paid the National Minimum Wage if they are at their place of work and required to be there. Similarly, such time is likely to count as ‘working time’ under the Working Time Regulations if the worker is required to be on-call at the place of work.
Contact Solve to help keep you informed of the changing legislation in this area.