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Zero Hour Contracts: Menace of the worker or just practical?

The wider media has been abuzz recently over a survey conducted by the Chartered Institute of Personnel Development, which indicated that the number of individuals working under zero hours contracts is roughly four times the official estimates previously calculated by the Office of National Statistics.

The wildly differing figures have lit a fire under the government which has called for a review of the contracts, while union lobbies are seeking for them to be banned outright. So why then are these divisive contracts so prevalent in our society?

As their name suggests, those working under a zero hours contract are not guaranteed any set amount of hours by their employer. The general operation of them in practice then is that an employer calls upon workers to carry out work as and when needed. This does of course place the worker in an uncertain position, particularly where that job is their only source of income.

A further issue is that those working under such contracts may not hold the status of “employee” (only “worker”) and so have less employment rights than their employee colleagues – most critically the right to claim unfair dismissal.

So from an employee perspective, you would be forgiven for thinking that zero hours contracts are a tool utilised to exploit a workforce devoid of the most robust rights available.

In some instances you and indeed the unions may be right, however there are certain industries where they are the perfect staffing solution. A good example would be seasonal work in a beach community, where work levels fluctuate with and are ultimately dictated by the changeable British weather.

Furthermore, these contracts are not entirely employer friendly either; the relevant workers are less likely to be under an obligation to accept work when it is offered, so the employer too can be placed in a tenuous position should their staffing needs suddenly and unexpectedly increase. The approach taken by many employers in response to this uncertainty is to build up a large bank of zero hours workers to ensure that cover can be secured when required.

From a worker’s point of view the contracts are a sound arrangement where the job in question is not their primary source of income, or if they are also in full time education. It is only therefore the workers that rely on the zero hours role as their only income that issues can arise where workers are effectively fighting over the hours available in a given week.

Conclusion

So overall it is fair to say that there is a place in society for zero hours contracts provided they are used in the correct setting and are not exploitative. The likely question to be answered by the government’s review then will be what action can be taken to ensure such contracts are not used in the wrong circumstances.

For employers it is naturally always best to take professional advice to assess their staff working arrangements and what contractual setup best suits their business.


Samira Cakali

Samira Cakali is a pragmatic and approachable solicitor advocate with extensive contentious and non-contentious experience in the fields of employment law as well as civil litigation, within a range of commercial businesses from SME’s to multinationals as well as senior executives.

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