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Zero Hour Contract Law

If you are one of the tens of thousands of individuals employed in the UK on a zero hour or casual basis, it is important that you understand your employment rights under zero hour contract law.

Below we provide a basic guide to zero hour contract law, including:

  • what constitutes a zero hour contract
  • your rights as a ‘worker’ under zero hour contract law – not an ‘employee’
  • your employer’s responsibilities under zero hour contract law
  • what you can do if your employer breaches your legal rights
  • when to seek legal advice for zero hour contract law matters.

What is a ‘zero hour’ contract?

Under section 27A(1) of the Employment Rights Act 1996 a zero hour contract is used to describe many different types of casual agreements between an employer and individual worker. An employer makes work or services available to a worker if the employer requests or requires the worker to do the work or perform the services.

It is generally understood to be a contract under which there is no obligation on the employer to provide any minimum number of working hours, or even to offer work.
Equally, the worker is not obliged to accept any work that is offered. The employer offers work as and when it arises, and the individual can either accept or decide not to take up the offer of work on that particular occasion.

Needless to say, the entitlement to be paid only arises if work is accepted and actually undertaken.

When zero hour contracts are commonly used?

Zero hour contracts are particularly prevalent where seasonal work or special events require additional levels of staff over short periods for example, in the retail, hospitality, leisure and catering industries. That said, zero hour contracts can be used by any employer in need of an accessible pool of workers in response to fluctuating demand or temporary staff shortages.

For the employer, a zero hour contract avoids any obligation to provide guaranteed levels of work. For the worker, a zero hour contract can provide you with greater flexibility than any other type of employment contract. In this way you can fit earning an income around study, childcare or other commitments.

The casual nature of the zero hour contract means that you are not obligated to work a minimum number of hours, and you can refuse any work offered without consequence. Needless to say, there is still a risk that if you persistently refuse work your employer may terminate your working arrangement altogether.

Where do I stand legally under UK zero hour contract law?

Notwithstanding the casual nature of a zero hour working arrangement, there are statutory rights and obligations that still govern that working relationship. Under zero hour contract law the worker category provides a floor of rights to those who do not satisfy the tests for employee status but are not working for themselves.

As a ‘worker’ under a zero hour contract of employment you have fewer employment rights than ‘employees’, although you still have many of the most basic ones. This includes the right to working time limits (not more than 48 hours on average per week) and to paid annual leave, as well as protection from unlawful discrimination and whistleblowing.

Typically, of most significance for workers under a zero hour contract is the right to be paid the national minimum wage. Irrespective of how many hours you are actually offered, under zero hour contract law your employer must pay you at least the national minimum wage for the number of hours worked. Further, as a zero hour worker you have the same statutory rights in respect of travelling time (excluding your commute), or waiting between jobs, as other workers when calculating what counts as working time.

The current rates in accordance with the National Minimum Wage (Amendments) Regulations 2018 are as follows (as of April 2018):

• For workers aged 25 and over – £7.83 per hour
• For workers aged 21 to 24 – £7.38
• For workers aged 18 to 20 – £5.90
• For workers of school leaving age up to 17 – £4.20

Whilst your minimum statutory rights may be severed in circumstances where your zero hour contract comes to an end – this may occur where there have been breaks in your working arrangement – your employer is still statutorily obliged to pay you for any accrued and untaken holiday pay.

Does zero hour contract law protect me if I also work for someone else?

Under zero hour contract law your employer cannot prevent you from looking for work elsewhere, or accepting work from someone else. It may be that your employer is unable to offer you sufficient hours. That said, you do not have to justify seeking or accepting other work.

Furthermore, your employer cannot seek to contract out of these statutory provisions by stipulating within your contract that you must seek their permission before accepting work from another employer. In circumstances where your zero hour contract contains an exclusivity clause, you are not legally bound by it.

By virtue of section 27A(3) of the 1996 Act it provides that any provision of a zero hour contract which:

(a)prohibits the worker from doing work or performing services under another contract or under any other arrangement, or

(b)prohibits the worker from doing so without the employer’s consent, is unenforceable against the worker.

Provision is also made under regulation 2 of the Exclusivity Terms in Zero Hours Contracts (Redress) Regulations 2015 for a worker not to be unfairly dismissed, or subjected to a detriment, in consequence of doing work or performing services for another employer in breach of a contractual prohibition.

Any dismissal in these circumstances will be considered automatically unfair, and there is no qualifying period of continuous service to bring a claim for unfair dismissal. Similarly, if you suffer a detriment, this will be considered unlawful.

What are my remedies for any breach of zero hour contract law?

Under zero hour contract law you are entitled to raise a dispute or lodge a claim in the employment tribunal in relation to an alleged breach of your statutory rights in the same way as an employee.

Moreover, it is an offence for your employer to pay you less than the national minimum wage. In these circumstances you may file a complaint with HM Revenue and Customs, anonymously or otherwise. Your employer may be ordered to pay any assessed arrears, together with a financial penalty.

Similarly, in relation to working time disputes you may lodge a complaint with the employment tribunal. Your employer may also be guilty of an offence here.

Should I seek legal advice for zero hour contract law matters?

The law relating to zero hour contract law can be confusing, not least the regulations governing your statutory rights in respect of the national minimum wage and working time limits, as well as any unfair dismissal arising out of working for another employer contrary to a contractual exclusivity clause.

Further, you may have additional rights arising out of your contract of employment that may elevate your status from ‘worker’ to ‘employee’. The mere fact that your terms of employment have been described by your employer as a zero hour contract does not in itself determine your employment status.

Whether or not you are a ‘worker’ or ‘employee’ will depend on the terms of your employment contract, as well as the nature of your working arrangement in practice. For example, If you have regularly worked the same shifts for six months you may be deemed to be an employee, irrespective of any zero hour contract. As an employee, you will be entitled to additional employment rights, including but not limited to the minimum statutory notice period, the right not to be unfairly dismissed and redundancy payment.

A legal adviser specialising in employment law will be able to advise you on your potential rights and possible remedies, providing you with a legal assessment of your particular case under zero hour contract law, as well as what practical steps you can take to resolve any workplace dispute.

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