There’s been plenty of bad press about zero hours contracts in recent years. In October we blogged about guidance published by BIS for employers on how zero hours contracts should be used. The guidance recommended that these contracts should make clear to the individual how work will be offered and that they are not obliged to accept work on every occasion.
Many stories in the press about “zero-hours contracts” have brought attention to concerning examples of workers who are prevented from working in other jobs, while at the same time having no guarantee of regular work. This type or restriction is known as an “exclusivity clause”. Tales of people being “on call” for hours each day but only being paid minimum wage for the hours they actually work demonstrate how exclusivity clauses lead to exploitation of workers.
This week the government made Regulations which are aimed at making exclusivity clauses unenforceable. The Regulations will come into force on 11 January 2016 and will provide zero hours workers with:-
- a right not to be unfairly dismissed if the reason is that they have failed to comply with an exclusivity clause; and
- a right not to be subjected to a detriment done by an employer for the reason that the worker has failed to comply with an exclusivity clause.
Is it all bad?
The use of zero hours contracts is clearly an area that needs to be regulated to prevent abuse. However, the fact is that these kinds of arrangements have been around for a long time and, for some people, they can work well.
Although not a legal term, a “zero hours contract” typically describes a casual agreement between an employer and a worker under which the employer doesn’t guarantee to provide any minimum amount of work and undertakes to pay only for work done. In its pure form, this suits certain individuals. Consider, for example, an actor or musician who tours during certain months of the year, sometimes at short notice. For them, a “zero hours” agreement would offer the flexibility of being able to accept offers to tour while also having a job to return to when they’re at home, rather than having to start looking for work every time a gig comes to an end.
In August this year the head of McDonald’s in the UK spoke out in defence of the flexible contracts they offer employees. Crucially, McDonald’s said all of its employees had permanent contracts and were entitled to holiday and sick pay, as well as being free to work elsewhere.
CIPD also recently published results of a survey of 350 workers on zero hours contracts. The research, which also drew on data from the Office of National Statistics (ONS) Labour Force Survey, the CIPD's Employee Outlook survey and Labour Market Outlook surveys, found that 65% of zero-hours contract employees were either very satisfied or satisfied with their job is (compared to 63% for all employees). They were also more likely to say that they had the right work/life balance and were less likely to fell under excessive pressure at work.
Clearly, there is still likely to be life after the scandal for zero hours contracts - it’s the abuse of such arrangements that needs to be addressed.