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New rights for Zero hours contract staff – is your company compliant?

Have your HR team adjusted your practices accordingly?

In May last year the Government introduced legislation to prevent employers from imposing exclusivity clauses on staff employed on Zero hours contracts.

Staff can now take their employer to an employment tribunal, if they try to impose such clauses, thereby restricting the employee’s income capacity. And as of January 2016, penalties will be imposed on offending bosses, if the tribunal finds them to be in breach of the new regulations.

Initially, no such penalties were included in the Small Business, Enterprise and Employment Act, which meant that employees had no redress, even if a tribunal found in their favour. The new legislation is not meant in any way to curtail the use of Zero hours contracts, as they can work well for both employers and employees, where there is a need to be flexible.

A Zero hours contract means that employers are not obliged to provide a minimum number of working hours, and employees are not obliged to accept any work offered to them, which can work well for both sides.

Employers involved in this type of working agreement often face a need to employ extra staff for a short period of time, or to cover temporary staff shortages. By the same token, employees requiring flexible employment terms can also find this type of contract advantageous.

Prior to the introduction of the new Act last year however, some employers were imposing restrictions on employees preventing them from working elsewhere in order to augment their income. This practice is no longer permitted and employees may be awarded compensation if they take their case to an employment tribunal and their complaint is upheld.

For employers keen to ensure that they are compliant with the relevant section of the Small Business, Enterprise and Employment Act, ACAS has developed a helpful and accessible Zero Hours Myth Busting article, available on their website.

In it, ACAS clearly states that employers must be aware that workers on a Zero hours contract are entitled to annual leave, or a percentage of an annual leave allowance, if their service is not continuous. The article also points out that workers on these contracts are not obliged to accept work offered and should not be forced to do so.

In addition, Zero hours workers have the same statutory rights relating to travelling time or waiting between jobs as other workers.

Companies who employ staff on Zero hours contracts need to be fully aware of the legislation governing this type of working agreement and of the recent amendments, to ensure they are fully compliant.

As yet, the level of compensation awarded to claimants is unlikely to be particularly high but it could be expensive to become too complacent.

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