Zero-Hours Contracts: What You Need to Know

With Christmas right around the corner, many companies will be sourcing seasonal staff to help navigate the busiest time of the year. Many of these new starters will be employed under a zero-hours contract. But what exactly are they, and what do employers need to know?

What Is a Zero-Hours Contract?

A zero-hours contract, also known as a casual contract, is one in which the employer does not guarantee the employee any hours of work. Under this arrangement, you can offer work as you see fit, and the individual can choose to accept or decline each offer.

How Much Is Someone on a Zero-Hours Contract Paid?

Regardless of how many hours they work, every individual on a zero-hours contract must receive at least the National Minimum Wage.

Do Employment Rights Stay the Same?

Yes. Employees on zero-hours contracts are entitled to the same statutory employment rights as their colleagues. Rights will depend on their status—either a worker or an employee—but include:

• Eligibility for at least the National Minimum Wage
• Protection from discrimination
• Paid annual leave
• Daily rest breaks

What Is the Difference Between a Worker and an Employee?

An employee works under the terms laid out in an employment contract. A worker is a broader term covering anyone who works for you—whether under an employment contract or another type of contract—but does not include the self-employed.

What Are the Long-Term Implications?

Zero-hours contracts have become increasingly popular as businesses seek cost reductions and greater flexibility in a demanding environment. While they offer flexibility and additional opportunities for both parties, they also present challenges such as unpredictable hours and potential stress.

No matter what you decide when employing staff over Christmas, it’s vital to consider all likely implications to ensure long-term sustainability.

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Article by Palmers Solicitors