Zero Hour Contracts

You can’t help but have heard about zero hours contracts.

At its heart is a pretty simple idea.

You sign a contract with an employer which means they don’t have to provide you with a minimum number of working hours and you get the right to turn down any offer if you want to.

Latest figures from the Office for National Statistics show the number of people on zero hour contracts in the UK increased by around 100,000 last year, to stand at around 1.8million.

As more and more of us come into contact with these contracts, it’s important we know what they are all about. So, here’s a look at some of the most commonly asked questions around the issue.

Do I have employment status when I am on a zero hours contract?

Most zero hours contracts will give staff 'worker' employment status. Zero hours workers have the same employment rights as regular workers – although breaks in the contract can affect rights that accrue over time.

If you are on a zero hours contract you get just the same entitlement to holiday, minimum pay rates and travel expenses as anyone else.

When are zero hours contracts used?

These contracts help businesses cope with fluctuations in the workload, such as seasonal demands for a specific product or extra shifts to cope with a big event. Common uses include arranging staffing for last-minute events, to cover staff shortages and to build up a bank of extra workers who can be called in to help meet a rise in demand.

Employers should constantly review the need for zero hours contracts to ensure they are making the best use of their resources. In some cases, it might be more effective to use agency workers, offer staff fixed-term contracts or employ a new member of staff permanently.

What constitutes a break between employment in terms of zero hours contracts?

This can depend on the exact nature of the contract and any specific agreements which are entered into. It might be that the contract only exists when work is provided, and in this case a full calendar week without work from Sunday to Saturday is required to bring about a break in employment.

This is an important area because when employment is continuous, certain employment rights build up over time. One example is holidays, where most workers do not need to accrue their annual leave before taking time off once they have worked for a company for a year.

But if employment is broken, the employer must still meet certain responsibilities, such as paying for any holiday time which has been built up but not taken.

How can my employment status change?

As we said, in most cases you will have ‘worker’ status on a zero hours contract. But this can change depending on your relationship with your employer and the manner in which you are treated.

For example, if you are subject to a disciplinary hearing, this could change your status to that of an ‘employee’ offering additional employment rights.

The expert advice from Acas is that: “Zero hours status also has to stand up on paper (in the contract) as well as in practice. Where there is a dispute over this, an employment tribunal may decide for themselves what contractual relationship exists between employer and worker and any associated employment rights, including enhancements such as accruing the right to take maternity leave or pay and the right to ask to request flexible working.”

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