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Zero hours contracts – should we keep them?

James Watkins - Law on the Web

  1. 07 April 2015
  2. Employment
  3. 0 comments
Unhappy worker

The latest statistics from the Office of National Statistics indicate that there are now almost 700,000 people working on zero-hours contracts in their main jobs. Zero-hours contracts have been a source of controversy for a while now, but what’s all the fuss about?

What is a zero-hours contract?

“Zero-hours contract” is not a term defined in law, meaning that there is no fixed legal definition of what a zero-hours contract is. However, there is a widely accepted definition of what constitutes a zero-hours contract.

A worker on a zero-hours contract has no guaranteed hours – their employer can ask them to do a shift, but the worker is, in theory, under no obligation to accept it, and the employer is under no obligation to offer it.

This can be useful to employers, as it allows them to take on more employees on a more flexible basis – for example, you could call upon a zero-hours worker to provide emergency cover if another employee is unable to work, or if you need extra hands to handle additional workload.

Such an arrangement can also be useful for the worker – if they have has a family to look after, another job or other obligations, they do not have to commit to fixed hours or to doing a certain number of hours each week.

So what’s the problem?

Problems with zero-hours contracts

Unfortunately, zero-hours contracts have proven to be open to abuse, with some employers using them to take advantage of their workers.

While workers do have the right to refuse hours, many have reported being put under unreasonable pressure to accept shifts – for example, an employer telling a worker that if they don’t work a certain shift, they will not be offered shifts in the future.

It isn’t necessarily unreasonable for an employer to take this stance – if a worker repeatedly turns down hours, this could be interpreted as a lack of commitment. However, simply punishing a worker for refusing hours compromises their right to refuse them in the first place.

Limiting a worker’s hours is not a huge problem for all zero-hours workers, as many have other jobs they can earn from. However, some zero-hours workers have exclusivity clauses included in their contracts, meaning that they can’t work for anyone else.

Again, it is understandable why an employer would want their workers to be available when they might need them, and not working for someone else. However, if you are only offering your worker a trifling number of hours in a week, it is hardly fair to prevent them from working for someone else.

Should zero-hours contracts be outlawed?

Despite the negative aspects presented here and in the media, zero-hours contracts are not universally reviled, nor are they inherently bad news for workers. They can offer flexibility for workers. However, not all workers want this flexibility – many on zero-hours contracts crave the security of fixed hours and a steady wage.

One of the main concerns over zero-hours contracts is not that they exist at all, but the fact that they are becoming so prevalent. If zero-hours contracts became the norm, lower paid workers would have little option but to submit to them, whether they wanted the extra flexibility or not.

Banning zero-hours contracts altogether is an extreme outcome, one that is unlikely to occur. However, it is clear that some curbs are necessary to make things fairer for workers.

One method would be to prevent employers from adding exclusivity clauses to zero-hours contracts, meaning that workers will be free to work for other employers. The current proposal, included in the draft Zero Hours Workers (Exclusivity Terms) Regulations 2015, would introduce a threshold based on a worker’s hours and how much they earn. Unless the worker is above this threshold, they will be free to work for another employer.

The Regulations would also give the worker the right to take their employer to an employment tribunal (assuming that they can afford the ever-increasing tribunal fees).

Another proposal made last year by the Labour Party would give zero-hours workers the right to improved contract terms once they have worked for an employer for an extended period of time. After six months, they would have the right to request a minimum number of hours, and after a year, they would be automatically entitled to a fixed-hours contract.

What do you think? Would these changes be enough to stop abuses of zero-hours contracts, or should they be scrapped altogether?

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