One of the battlegrounds for the forthcoming General Election focuses on the use of zero hours contracts. Are they the scourge of society or useful in the UK maintaining and growing a flexible workforce fit for the 21 century?
Labour leader Ed Miliband described zero-hour contracts as an "epidemic" when he revealed changes to the party's policy on it. Mr Miliband has stated that, if elected, a Labour government would guarantee the right to a contract for zero-hours workers who have been working regular hours for 12 weeks. Labour has said the changes would cut around 90% of zero-hour contracts.
In contrast, the current Conservative and Liberal Democrat coalition Government has instead focussed, in particular, on the use of exclusivity clauses in zero-hours contracts. Their plan (through the implementation of the Small Business, Enterprise and Employment Bill expected to come into force later this year) is to make such exclusivity clauses unenforceable and to introduce sector specific codes of conduct to regulate the use of such agreements and the terms on which work should be offered and cancelled. The Bill will also give the Government power to introduce further provisions, including conferring certain rights on zero hours workers and imposing financial penalties on employers.
A "zero-hours" contact is a contract between an employer and a worker whereby the employer is not obliged to provide the worker with any minimum working hours of work, and the worker is not obliged to accept any hours that are offered. This often causes confusion as to whether an individual is an employee with employment rights or a worker who has more limited rights under employment law.
This lack of obligation, typically an essential element of an employment contract, has led to uncertainty and allegations of exploitation, particularly if these contracts tie the individual to the organisation under an exclusivity clause. Also, some employers have been accused of penalising employees who refuse work or raise employment concerns by reducing or refusing hours of work.
Only using employees when they are needed can be attractive to businesses allowing them to utilise a more flexible workforce to deal with peaks and troughs in demand, but it also leads to a lack of security, particularly for individuals and can cause difficulties in accessing State benefits or simply planning day to day expenditure such as household bills, food and crucial necessities. Companies that regularly use zero hours contracts are criticised on the basis that they predominantly impact the most vulnerable workers in what are the lowest paid jobs.
However, zero-hours contracts, by providing flexibility, may work to serve the interests of both employer and worker if and when used properly. To avoid criticism, employers are advised to consider carefully the circumstances in which they use such contracts and whether they are able to offer at least a minimum number of hours per week, treat workers on zero-hours contracts fairly just as they would their other employees – and avoid the use of exclusivity clauses – let's face it would you like to be told that you may not get any work (and therefore no pay) but be prevented from seeking work elsewhere!
For more on the use of zero-hours contract see our previous blog-post
Debbie Fellows is a specialist Employment Law Solicitor. We are always delighted to talk without obligation about whether we might meet your needs. Call Debbie on 01382 229111 or email dfellows@thorntons-law.co.uk
