What you need to know about zero-hours contracts

Almost one million workers in the UK don't have guaranteed hours.

by Michael Burd and James Davies

Latest statistics show that more than 900,000 people in the UK work under zero-hours contracts, up 20% on 2015. 'Zero-hours' is a general term used to describe employers hiring staff with no minimum level of work or pay. Workers are engaged on an ad hoc, casual basis and only paid for the work they actually do.

The legal position on zero-hours contracts is often misunderstood. They are not illegal, but are regulated. Individuals engaged in this way are likely to be legally categorised as 'workers' or 'employees', meaning they qualify for rights such as holiday pay and the minimum wage. Additionally, a term in a zero-hours contract prohibiting the person from working elsewhere, known as an 'exclusivity clause', is unenforceable.

While the flexibility of zero-hours arrangements is often beneficial for both parties, their use in some cases leads to job insecurity for workers and negative PR for the employer - Sports Direct being an obvious recent example. As a rule of thumb, businesses should consider carefully whether or not zero-hours contracts are clearly appropriate and justified before using them.

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