Thursday, July 10, 2014

How will the Ban on Zero Hours Contracts Affect You?

In the recent Queen's speech, the Government announced its intention of "...cracking down on abuse in zero hours contracts".  It has subsequently published the Small Business, Enterprise and Employment Bill 2014, which will now start its progress through the parliamentary process.

The Definition of a zero hours contract in the Bill, to paraphrase, is one where the undertaking of any work under the contract is conditional on the employer offering work, and where there is no certainty that the employer will offer any work.  The Bill goes on to say that any clause in a zero hours contract which prohibits the employee from doing work for anyone else, or where they have to obtain permission from their employer to do so, is unenforceable.

So there is no problem with having a zero hours contract, as long as there is no exclusivity clause in the contract.

The use of casual contracts, therefore, is unaffected.  This is where the work is very ad hoc and there is no obligation on the employer to offer work and none on the employee to accept any work offered.  Typically these are used for plugging gaps in staffing due to illness or holidays.

It also seems that any employers who want a loop-hole, can get round this restriction by guaranteeing a minimum amount of work under the contract - perhaps just one hour per year! That would mean that it would not be a zero hours contract as defined, so the ban would not come into effect.

It seems likely that there will be regulations coming out at some point to beef up the restrictions to some extent, and the Bill does leave that possibility open.  So watch this space for more detail as it emerges.