Zero hours are defined broadly as being a contract or arrangement under which an employer may offer or provide work for an individual but there is no certainty that such work will be made available.  Such contracts are a useful means of covering seasonal or peak workloads – see our earlier article [1].

Some employers have abused the use of these contracts by insisting that an individual may not work for another employer.   An individual without other income would find that restriction creates a real problem and legislation was promised to stop such abuses.

This article covers:

• A summary of the new Regulations;
• The stings in the tail aimed at rogue employers:
• Key points for employers to check about their zero hours contract arrangements.

Exclusivity Terms in Zero Hours Contracts (Redress) Regulations 2015

This law came into effect on 11th January 2016.  Zero hours workers can seek redress if an employer:

• stops such an individual from working for another employer;
• requires the individual to obtain consent to work for another employer;
• imposes another form of detriment upon such an individual who does perform work for another employer.

The Regulations give a worker the right to claim unfair dismissal if he/she is dismissed and the principal reason is that he has breached a contractual clause prohibiting him from working for another employer.   That will be treated as an automatically unfair dismissal.

A contractual term that prohibits a zero hours worker from working for another employer will no longer be enforceable and so the individual is free to seek other work.   If an employer imposes a detriment on a worker which has the effect of wilfully preventing or attempting to deter a worker from taking up or remaining in other work, the affected worker may make a claim against the employer responsible for those acts or omissions.

The new regulations do not prevent an employer from terminating a zero hours contract or arrangement on objectively justified grounds.

The Sting in the Tail

Employers need to note the following implications:

i)    there is no minimum service period required by a worker to bring a claim;
ii)   compensation embraces a wide range of losses including:

• any expenses reasonably incurred by the complainant in consequence of the act, or failure to act, to which the complaint relates;
• loss of any benefit which the complainant might reasonably be expected to have had but for that act or failure to act.

The maximum award would be the same as the basic and compensatory award in unfair dismissal cases.  The Basic Award is currently £14,250 and the Compensatory Award is whichever is the lower of  £78,335  or 52 weeks of gross pay of the claimant.

iii)  The employer is required to identify the ground on which any act, or deliberate failure to act, was done which is the subject of a claim;
iv)  The Tribunal may make a declaration of the rights of the complainant and the employer in relation to the matters to which the complaint relates and may order the employer to pay compensation to the complainant.
v)   The individual making a claim is under a duty to mitigate any loss suffered by him.

Workers Should Not Delay Claims

Claims have to be made within 3 months from the act or omission concerned.  In the case of a series of acts or omissions the time limit runs from the date of the last incident.  A Tribunal may hear a claim which is out of time, if it is just and equitable to do so.

Key Points for Employers to Check

A.  Confidential information clauses –  as a worker may accept work with other employers while under a zero hours arrangement with you, ensure that you have effective clauses covering the use of confidential information obtained whilst in the course of your employment.   

B.  Working for other employers – review your zero hours ‘contracts’ and other documents to remove any clauses that either prohibit working for another employer or require your consent to do so.  Ensure that existing zero hours workers are made aware of any changes you make as a result of your review and make clear (verbally and in writing) what if any restriction clauses are lifted. 

C.  Brief Operational Managers – the pressure experienced by some managers may make them feel that they can not afford for zero hours staff not to be available at short notice and so may try to make it unattractive for such workers to accept work from other employers.  Some managers may use covert tactics to try and enforce availability.  As the employer, you may be liable if such practices result in claims of exclusivity clauses or acts/omissions that are detrimental to zero hours workers taking up offers to work with another employer(s).

Use the opportunity, if appropriate, to allow a group of managers to review the way in which zero hours workers are used to see if there are ways to improve how you meet your ‘staffing’ needs

D.  Remind HR and Recruitment Staff – similar to  point C above, brief them on the changes so that they are clear about your future policy and that they use only revised contracts and documentation.

Practical Help  and Advice

If you would like help to review your contracts/documentation or to discuss options for more flexible staffing.  please feel free to contact the author, Jim Harrington via office@hrmd.uk or via the contact details on the home page of our website

Sources

[1]  Earlier articles from our blog on zero hours and casual hours arrangements can be seen via these links to the articles – Casual/Zero Hours Staff – A Balanced Approach