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  • David Sharp
  • 20 October 2015
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Zero hours contracts guidance published

The UK’s Department for Business, Innovation and Skills (BIS) has issued new guidance for employers on the use of zero hours contracts – the controversial model used in many sectors to employ workers on an as-needed basis.

Zero hours contracts are defined by BIS as an employment model where the employer does not guarantee the individual any hours of work. Instead, the employer offers the individual work when it arises, and the individual can either accept the work offered, or decide not to take up the offer of work on that occasion.

Following criticism that zero hours contracts allow employers to exploit workers, the Government introduced new rules on 26 May under the Small Business, Enterprise and Employment Act 2015 to ensure people could not be forced to work exclusively for any one employer under a zero hours contract.

New BIS guidance suggests when it might be appropriate to use zero hours contracts, such as:

  • new businesses looking for flexible provision at start up;
  • seasonal work;
  • cover for unexpected sickness;
  • special events where there may be peaks and troughs of demand; and
  • testing a service, where the medium-term outcome may not be known.

 

Interestingly, the guidance also gives an insight into what the Government regards as inappropriate use, for example if the job offered will mean the individual will work regular hours over a continuous period of time. The guidance states:

“Zero hours contracts are rarely appropriate to run the core business… Many businesses provide a regular service or product and have a broadly predictable timetable or output and so permanent or fixed hour contracts can be more appropriate.”

Despite criticism from the unions, zero hours can deliver benefits to both employers and employees, with many workers welcoming the flexibility that this type of work allows them.

International Workplace HR Consultant, Tar Tumber, supports the view that zero hours contracts can be a force for good:

“Where these have been used ethically, they have provided a flexible workforce option for employers and flexible working option for the staff.”

The BIS guidance is available here.