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Zero Hours Contracts & Understanding Your Legal Rights

We discuss zero hours contracts, answering some of the most common questions about zero hours contracts, so you can better understand and protect your legal rights.

“What are Zero-Hours Contracts?”

There has been an explosion in interest relating to the use of zero-hours contracts which has resulted in numerous stories in the press and much politically charged debate.

Figures released by the Office of National Statistics (ONS) estimate that 1.4 million people in the UK are on zero-hours contracts. However, commentators have challenged the accuracy of the figures and even suggested that the people questioned did not fully understand what is meant by a zero-hours contract. So, to help you identify one when you see it, we’ve set out, below, the main things you need to know about zero-hours contracts.  

No Guarantee of Minimum Work Hours

Zero-hours contracts are also referred to as casual contracts, they allow employers to hire staff with no guarantee of work. For this reason critics have likened them to the days when labourers would turn up to the gates of the factory waiting to be picked for a days work. The way zero-hours contracts operate is that an individual works only when they are needed by the employer, which can often be at short notice and the amount of pay will depend on how many hours are worked.

Some zero-hours contracts oblige workers to take the shifts they are offered; others do not. There is often no guarantee of shift pattern. Workers appointed on these terms should check the terms of their employment contact to see what, if anything, is mentioned about guaranteed shift patterns or guaranteed minimum hours.

No Exclusivity

Generally there is no exclusivity in zero-hours contracts. This means that an individual should be free to enter into contracts with other employers. However, one of the biggest controversies has been that employers using zero-hours contracts are expecting workers not to work for anyone else, despite the fact that there are no guaranteed hours.  

The employer is free to issue as many zero-hours contracts as it wishes. This can result in a disproportionate number of zero-hours contracts being issued compared with the work that is actually available. There are concerns that employers may favour some individuals over others when providing work, which can lead to a culture of staff being too scared to air any concerns they may have in case the work inexplicably dries up.

Who Uses Zero-Hours Contracts?

Zero-hours contacts seem to have been widely used in industries such as tourism and retail for some time. However, they are being used increasingly across a wider range of sectors. Many teachers, journalists and lawyers are also on zero-hours contracts. Certain groups of people are more likely to be on zero-hours contracts, such as people under 25 or over 65 years of age, those in full-time education and a disproportionally large number are likely to be women.

Employers say that zero-hours contracts provide both parties with welcomed flexibility. However, from the worker’s point of view zero-hours contracts can create problems. It's difficult to budget when they are faced with uncertainty as to how much the worker is likely to earn, or to arrange childcare when there is no guarantee of working hours or times.

Am I an Employee if I’m on a Zero-Hours Contract?

The short answer is, you might be – it depends on the facts.

The law provides a broad range of legal rights and protections to individuals who are classed as ‘employees’.  The legal status of people on zero-hours contracts will depend on a number of factors (such as whether the employer has a degree of control over the worker or whether the worker is required to carry out the work themselves). This is not a very satisfactory position as it allows no certainty as to which employment rights apply to workers on these contracts.  

It’s worth noting that many zero-hours contracts will expressly provide that the employer is under no obligation to provide work and that the worker is under no obligation to accept work. This will not automatically mean that an individual is not an ‘employee’ especially if the terms of the contract don’t actually reflect the reality of the arrangement.

Do I Have a Right to Claim Unfair Dismissal?

Employees, as opposed to workers, have a right to bring an unfair dismissal claim if they are unfairly dismissed.   

Am I Entitled to Paid Holiday?

Yes. But bear in mind that it may be difficult to calculate holiday entitlement due to the irregular work pattern.

Am I Entitled to be Paid Minimum Wage?

Workers must be paid the national minimum wage for the hours actually worked, although this does not include rest breaks. In addition, workers who are required to be available for work ‘at or near the place of work’ must also be paid the national minimum wage during that time, regardless of whether work is actually provided. Similarly, if a worker is called into work, only to be told that they are not needed (which is reportedly common practice among some employers), they can claim national minimum wage at least for the time that they were required to be at the workplace waiting to be given work.

For expert legal advice about an employment law issue call Slater and Gordon Lawyers on freephone 0800 916 9060 or contact us online and we will call you.

Slater and Gordon Lawyers UK have over 1,200 staff in 18 offices located in London, Manchester, Liverpool, Birmingham, Sheffield, Milton Keynes, Bristol, Cambridge, Cardiff, Edinburgh, Halifax, Newcastle, Wakefield & meeting rooms in Bramhall, Cheshire.