With so many employers hiring on this basis, they must ensure that the keep up to date with the possible changes to the rules around zero hours contracts as Employment Rights Bill makes its way through the legislative process. Preparation ahead of the changes will be key to ensuring that they remain compliant and mitigate the risk of costly claims.
Felecia Wood, Associate Director of Client Experience and Consultancy at Croner says, “Zero hours contracts have faced a lot of criticism in recent years. When used fairly, they provide flexibility to both workers and employers. However many argue that there is a disproportionate amount of benefits to employers and few for workers, meaning that workers on these types of contracts are often being exploited.
“Under the current rules on zero hours contracts employers do not have to offer staff any minimum amount of working hours, but on the other hand staff have the right to decline any work that is offered to them, allowing them to choose not to work when it doesn’t suit them. Under current rules, staff on zero hours contracts can be legally classed as employees or workers. Workers have some basic rights, including the right to be paid no less than the national minimum wage, holiday entitlement and pay, and protection from discrimination. As well as these, employees also qualify for additional employment protection rights like protection from unfair dismissal. As an employer, you must adhere to these rules, or you could be facing costly claims.
The Employment Rights Bill is currently on its way through Parliament, and it gives more rights to workers, which employers must be aware of. Although it has not been determined exactly when the proposed changes will be coming into effect, under the new rules, employers using zero hours contracts will need to provide workers with a contract that reflects their regular hours of work (referenced over a 12-week period) if they consistently work a regular amount of hours, reasonable notice of any changes in the workers shifts and proportionate compensation of cancelled or curtailed shifts.
Ahead of the changes coming into force legally, employers should start preparing ahead of time for a seamless transition and to ensure compliance from day one. Start by reviewing your current workforce and identify those on zero hours contracts. Consider the nature of the work that they undertake and whether another type of contract better reflects how they actually work in practice. Reviewing your current processes for shift requests and cancellations will also allow you to identify if these can be improved to allow for more reasonable notice.
No matter what type of contract your employees are on, it is important to communicate with them clearly about their rights and any changes to avoid any confusion or potential claims.”
