Zero Hours Contracts
A short article on zero hours contracts by David Curwen, author of Employment Claims without a Lawyer
David Curwen, Unity Street Chambers, Bristol
What are they?
Under a zero hours contract the employer is not obliged to offer a minimum number of hours and the worker is not obliged to accept any work offered.
This differs from a normal contract of employment where the employee will agree to work for a fixed number of hours each week.
A zero hours contract is still a binding legal agreement between the employer and the worker which imposes legal obligations on both sides.
An employee will have a contract of employment setting out the terms and conditions of their employment. A worker will have a contract or agreement, either oral or written, under which they agree to perform work for the employer on terms which might or might not be specified.
Examples of zero hours contracts
Such contracts are often used in the retail or service industry with jobs in bars or restaurants, catering events, where students want to work in the evenings or during the holidays. Couriers and delivery cyclists or drivers and health and social work are other areas where such contracts are found.
Rights under a zero hours contract
Once the worker agrees to carry out a shift, an assignment or delivery there is a contract that the worker will perform that shift or assignment and that the employer will pay for this work.
A worker is entitled to a minimum wage. The current rates as from 1 April 2018 are:
Over 24 year old - £7.83 an hour (also called the national living wage) 21 to 24 - £7.38 an hour 18 to 20 - £5.90 an hour 16 to 17 - £4.20 an hour
Each worker, even if they are on a zero hours contract, is entitled to holiday pay. This starts accruing as soon as they start work.
The normal entitlement to holiday pay is 5.6 weeks per year. For someone working five days a week this would be 28 days a year. The employer can decide whether this includes bank holidays or not.
The entitlement to holiday pay for a zero hours worker is based on actual hours worked. For each hour worked roughly 7.6 minutes of paid holiday time is earned. This is based on the calculation 5.6 weeks divided by 46.2 (52 – 5.6) x 100 = 12.07%. 12.07% of 60 minutes = 7.6 minutes.
The zero hours worker is entitled to receive this holiday pay if the contract is terminated and the paid holiday has not been taken. The holiday pay entitlement is calculated by taking the average pay over the preceding 12 weeks. If in any one week no work was done then an earlier week is taken.
A worker must give at least one week's notice of their intention to terminate the contract. The employer must give at least one week's notice of their intention to terminate the contract. The employer's notice will increase by one week for each year the worker has been contracted to work.
Under a zero hours contract the worker will not normally be paid in lieu of notice because the employer can simply give one week's notice and then not provide any work for that following week.
A zero hours worker can be subject to disciplinary procedures in the same way as an employee. In practice the employer will usually just terminate the contract without going through the formality of disciplinary procedures.
Where the employer decides to suspend the employee, then unless there is provision in the contract for suspension without pay, the worker should be paid whilst on suspension. This will be based on their average weekly pay. See the recent decision in [Rice Shack v Obi ]()UKEAT/0240/17/DM where the employer had to pay the suspended worker even though she had found other employment.
Whilst a worker might have the benefit of a grievance procedure in their contract, in practice making a complaint about any aspect of their employment might just result in finding that their working hours have been reduced.
If the worker can show that they were dismissed or otherwise suffered a detriment because they had made a protected disclosure or because of a protected characteristic under the Equality Act 2010 (age, disability, gender reassignment, marriage or civil partnership, pregnancy and maternity, race, religion or belief and sex) then they would be able to bring a claim in the Employment Tribunal.
Statutory sick pay and maternity pay
The entitlement to these benefits would depend on the worker showing average earnings above the lower earnings limit of £113 a week from one employer.
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Published: 28/08/2018 13:07