Zero hours contracts continue to be a contentious issue. These are contracts where the employer does not guarantee to provide the worker with any work and pays the worker only for work actually carried out. The Government estimates that some 125,000 employees are on such contracts.
Employers insist that in times of recession they are an important tool to enable a firm to maintain flexibility to deal with fluctuations in demand. Groups representing employees claim that businesses use them to avoid giving workers the status of 'employee' and eligibility for the full range of employment rights.
The Business Secretary, Vince Cable, has announced that employers hiring workers on zero hours contracts will no longer be able to compel staff to work exclusively for them. So called 'exclusivity clauses' will not be permitted in the contracts which will give workers the freedom to take employment elsewhere. The ban on exclusivity clauses will be contained in the Small Business, Enterprise and Employment Bill. The Government has made it clear that it considers zero hours contracts do have a place in the labour market but that the application of such contracts needs tightening up to protect employees from employers who misuse the contracts.
If your business relies on the use of zero hours contracts you may need to review your contracts. Contact us to discuss this issue.
For more information on the announcement go to News