Zero-hours contract – zero rights

The growth in the use of zero-hour contracts will mean more workers will lose their right not to be unfairly dismissed.

Typically, the employment status of a zero-hour contract worker is not the same as an employee who does qualify for employment rights. But a dispute on these issues will be determined by an employment tribunal.

The rise in zero-hours contracts have only just been matched by the surge in press interest for this working arrangement. Accurate figures, however, are more elusive.

The Office for National Statistics estimated that 1.4 million workers were employed on zero-hours contracts – February 2014. The Chartered Institute for Personnel Development estimated around one million employees were on zero-hours contracts – November 2013.

Zero-hours contracts provide a worker with an hourly rate of pay only when they have been engaged to perform work. There is no guarantee the employer will provide work and when work is not provided there is no pay. A common feature of these employment contracts is that staff are expected to be on standby and are unable to look for work elsewhere.

The recent trend has been for the spread of zero-hours contracts from low-paid sectors such as hospitality and retail to professionals such as hospital consultants and lecturers. Employers from JD Wetherspoon to Buckingham Palace use zero-hours contracts.

Benefits

The principal benefit for an employer of using zero-hours contracts is to maintain a flexible workforce able to meet fluctuating staff requirements such as in restaurants and shops. The costs tend to be cheaper than agency fees.

If the contract permits, employees gain flexibility to reject the offer of work if they find it inconvenient.

Rights and tribunals

Whether a worker is an employee with greater employment rights or only a worker with few rights is a matter for the employment tribunal. The tribunal will determine this point by closely scrutinising the working relationship.

Is the employee genuinely entitled to reject offers of work or not? If not, he maybe an employee.

In the recent case, Pulse Healthcare Ltd –V- Carewatch Care Services EAT 0123/12, the Employment Appeals Tribunal ruled the workers were employees despite the fact the contract was titled ‘Zero Hours Contract Agreement’.

A few other employment benefits continue to be available to both workers and employees, e.g. holidays, maximum working week of 48 hours.

The government has completed its review on zero-hours contracts but have yet to announce its reforms. The Labour Party has announced a manifesto commitment to give workers the right to ask for fixed-hours contracts after six months service. Either way, what is guaranteed is further press interest in the coming months.

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