Recently in the media there has been a great deal of coverage about the use of what has become known as zero-hours contracts. It should be stressed that there is no accepted legal definition of what a zero-hours contract is and the key issue will be the individual facts of each case.
Generally speaking in employment law there are 3 main categories of staff in a workplace – employees, workers and independent contractors. When someone is classified as being zero-hours it should not be automatically assumed that they are an employee with all the employment protection rights that go along with being an employee.
In many cases a zero-hours contract staff member will be legally classified as a worker and thus will have some, but not all, of the rights that an employee has such as – statutory holiday entitlement and National Minimum Wage.
There is often confusion about zero-hours contracts as they can appear from one perspective to be somehow exploitative but from another perspective be simply a flexible form of working.
This can be a complicated area of employment law and it is only by asking key questions, such as those listed below, that the picture becomes clearer. As a first step in determining the staff status of a zero-hours contract person the following questions could be asked:
- What does the contract say?
- Is what actually happens in practice different to what the contract says?
- Is the employer obliged to provide work?
- Is the staff member obliged to accept work?
- When is the obligation triggered? – As and when or does it exist generally?
- What actually happens week to week? (Does the paper reflect the practice?)
- Have things developed into a pattern over the years?
- Can the staff member appoint a substitute?
- Is the staff member obliged to follow/use the internal rules etc of the organisation?
- Does the staff member use their own equipment, wear a uniform etc?
- What are the tax and National Insurance arrangements?
When the answers to questions such as those above become clear it will give a clearer indication of what the status of the zero-hours contract staff member is (e.g.) an employee, a worker, a genuinely self employed independent contractor.
From here it will be easier to determine what the rights and responsibilities are for both parties to the contract.
If you are an employer or a zero-hours contract staff member and you have a query regarding these types of working arrangements please do not hesitate to contact the Labour Relations Agency’s Helpline on 028 9032 1442