Zero hours contracts can also provide a level of flexibility for the individual, which allows them to work around other commitments such as study or childcare. Some types of work are driven by external factors that are out of the employer’s control and this can happen in a range of sectors including, for example, hospitality, leisure and catering.
New businesses When a new business starts up it might need to build up a customer base to undertake work so, at first, they may need to employ people on zero hours contracts in addition to any permanent staff to manage fluctuating and unpredictable demands. Seasonal work or peaks in demand, where it is known that for short periods of time additional staff are needed to manage surges in demand such as retail sales at Christmastime or providing a cleaning service for example, following a festival or a New Year celebration.
Unexpected sickness Employers may need to be ready to cover periods of unexpected staff sickness and be able to call on experienced staff, for example, a pharmacist in a chemist or a lifeguard at a leisure center. All staff, regardless of their contract, are entitled to employment rights and should be treated fairly and within the law.
Zero hours contracts are rarely appropriate to run the core business, but might be useful for unexpected or irregular events such as bereavement leave by staff, to deliver sufficient customer service during peaks in demand, or when preparing to open a new store. Many businesses provide a regular service or product and have a broadly predictable timetable or output and so permanent or fixed hour contracts can be more appropriate.
Whether the individual is an employee or worker and what employment rights they are entitled to if the individual is an employee, how statutory employment entitlements will be accrued where appropriate, for example, redundancy pay the process by which work will be offered and assurance that they are not obliged to accept work on every occasion if they so wish how the individual’s contract will be brought to an end, for example, at the end of each work task or with notice given by either party Those who work on a zero hours contract may have caring responsibilities or have studies and may need to plan for childcare or around exams.
Employers should consider putting into place a policy explaining the circumstances when and how work might be cancelled, and how they try to avoid this, and whether the individual can expect any compensation for caring costs they may have incurred. Those who take up work on a zero hours contract are often students, partially retired, or have caring commitments.
The Small Business, Enterprise and Employment Act prohibits the use of exclusivity clauses or terms in any zero hours contract. An employer must allow the individual to take work elsewhere in order to earn an income if they themselves do not offer sufficient hours.
An employer must not attempt to avoid the exclusivity ban by, for example, stipulating that the individual must seek their permission to look for or accept work elsewhere. But it's a blanket phrase to describe many casual agreements between individuals and their employer.
With that in mind, a zero hours contract usually involves an employer not being able to guarantee the individual any hours of work, nor a set working pattern. Anyone working a zero hours contract has statutory employment rights.
The right to work no more than 48 hours on average per week. The right to opt out of only working 48 hours on average per week.
Statutory minimum length of rest breaks. Whichever status your staff have in your agreement with them, the relevant rights from above apply.
Hiring a worker can be great for both parties when you don't have a constant demand for staff. Special events like weddings, functions, and business expos.
In jobs where health & safety is a concern, such as a lifeguard or security officer, having workers to call up in the case of staff absence is essential. You should always be open and honest with any of your staff about their employment status.
This guide covers most employment statuses, but there might be somewhere you fall into a gray area. Access to statutory sick, maternity, paternity and adoption pay, as well as shared parental leave, varies depending on your employer.
Most are classified as workers, with some employment rights, such as the National Minimum Wage and paid holiday. You will not have any employment rights, but you will have fewer obligations to the agency, for example, you will usually be able to send someone else in your place.
Less common are agency employees, who are on what is called a ‘pay between assignments’ contract. You use your own money to buy business assets and cover running costs.
You will be covered under Health and Safety legislation as the person employing you is responsible for maintaining a suitable working environment. If you do this, the contractor employing you will make tax and Nice payments to HM Revenue and Customers (HMRC), similar to if you were being paid on a PAY basis.
Some examples of freelance workers include writers, journalists, graphic designers, video editors and photographers. You will need to register for Self Assessment and submit a tax return each year.
This kind of contract is becoming increasingly common in many sectors including the hospitality industry, warehouse work and couriers. You should be paid by PAY, so you will not need to register for Self Assessment to declare your income from zero hours contracts.
Some companies now class people operating on a gig economy basis as workers, which includes access to certain in-work benefits. But, this does not apply to all work in the gig economy and a number of these ruling are under appeal.
In simple terms, employees enjoy the full range of statutory work rights. The issue of employment status is a particularly hot topic these days as the nature of work becomes increasingly casualties.
If they are not careful, people are more likely than ever before to find themselves working on (and sometimes below) minimum wage and on-demand at the beck and call of their employer. Whether your employer is good, indifferent, ignorant or downright dodgy, it pays to be clear about what you are entitled to.
Your employer tells you what work to do, and when, where and how to do it; can subject you to a disciplinary procedure; and pays tax and National Insurance on your behalf. Check your contract of employment to see if any of these rights require a minimum length of service before you qualify to receive them.
Deliveroo couriers who forced a climb in August 2016 over a new pay structure their employers tried to impose on them are now working with the Independent Workers’ Union of Great Britain (IG WB) to demand union recognition from their employer, so they can get round the table to negotiate better pay and conditions. That could be as an actor or stage manager getting help from the Equity union to negotiate with your employer for better pay and conditions for you and your colleagues.