Zero hours contract–Good for employees and for employers?

Zero hours contract is a contract for casual working, under which the employer does not guarantee to provide the worker with any work and pays the worker only for work actually carried out.

The Small Business, Enterprise and Employment Act 2015, defines a zero hours contract as a “contract of employment or other worker’s contract under which a worker undertakes to perform work conditionally on the employer making such work available, but there is no certainty of such work being made available.” Exclusivity clauses in zero hours contract that prevent a worker from working under another contract or arrangement, even though the zero hours contract does not guarantee any hours of work, are unenforceable from 26 May 2015.

Zero hour contracts have been used for many years and are excellent for those individuals who want to work on a casual basis. For instance, students and those who want to work flexibly. Employers also use them, mainly to retain talent and also call upon workers often at short notice, at busier periods.

So it seems like a win-win situation! So what is all the fuss about?

There has been a bit of controversy, mainly because there is a concern that they do not offer financial stability and security.

Employees on zero-hours contracts do not have the same employment rights as those on traditional contracts, therefore the concern is that the contracts are used to avoid employers’ responsibilities to employees. Employers also could offer more hours to employees they “like” and less hours to those employees who they “do not like.”

However, for employers, there are a number of benefits of using zero hour contracts. They allow employers to take on employees depending on the business needs. Sectors such as tourism and hospitality or even retail often find it very advantageous. It also allows employers to avoid paying fixed overheads at a time when their business may not be doing as well as they expected.

I consider that many workers appreciate the flexibility that zero hours contract gives them. Some of them still work 30 hours or more week, despite being on a zero hours contract.

So, overall I consider that zero hours contract is a great way for employees to work flexibly and employers to have the flexibility to call upon staff as and when required, without being committed to paying fixed overheads.