Action needed on zero hours contracts, ELA says

The government must take action to tackle confusion about zero hours contracts (ZHCs), whether through guidance or legislation, the Employment Lawyers Association has argued.

David Widdowson, chair of the ELA legislative and policy working party on zero contract hours, said ZHCs meant "different things to different people" and there were many misconceptions. He said a clear definition was essential.

"Although ZHCs have been in use for many years in some specific industry sectors, surveys suggest they have significantly increased in usage in recent years but the level of misunderstanding that surrounds them exposes both employers and employees to legal challenge."

In its response to a consultation by BIS, the ELA, which is made up of both claimant and defendant lawyers, said that whether or not there was new legislation, there was a need for guidance.

New legislation could be framed to create a "freestanding right or set of rights with a remedy in the employment tribunal for breach" or certain contractual provisions in ZHCs, such as exclusivity clauses, could be declared unenforceable.

"It's not clear currently whether demanding exclusivity in ZHCs would stand up in court," Widdowson said. "Some employers see exclusivity as a pre-requisite to being able to create the job but, in general, where there is nothing especially confidential or peculiar to the role, exclusivity might equate to restraint of trade in preventing someone who has no guarantee of work from taking other work, if offered.

"An outright ban on exclusivity may not be the answer. ELA believes government needs to amend existing legislation so that exclusivity clauses are applied appropriately.

"This could be achieved by either obliging payment in return for signing such a clause or stipulating that a ZHC with an exclusivity clause has the same status as a mainstream contract of employment with all attendant rights including holiday and sickness pay. This would focus the employer's attention on the real necessity for exclusivity."

ELA said an outright ban on exclusivity in employment contracts with no guarantee of work might discourage employers from creating jobs, "particularly in the public services, business services and information, finance and transport sectors where ZHCs may be used for senior staff.

"A ban is unlikely to cause such an issue in sectors such as accommodation and food services or more generally where the use of ZHCs tends to be for junior or less skilled individuals."

The association said that even if exclusivity clauses were not expressly set out in a contract, individuals might still be pressured to accept work or be penalised for not doing so.

"Pressure can be brought to bear indirectly not to have multiple employers. Such pressure results from an inequality of bargaining position, rather than a deficit in contracts of employment or regulation.

"A code of practice would go some way towards addressing what may be perceived to be an undesirable practice, perhaps by making it clear that individuals should be able to refuse work, for example, on two occasions in any period of one month, before any action or detriment is taken in respect of them."