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Zero hours workers

Overview
  • Zero hours contracts do not have a specific definition in law - contracts  referred to as "zero hours contracts" may differ from one organisation to another.  
  • Zero hours staff may be engaged as employees or workers. A zero hours worker's employment status will depend on what the contract says and how the arrangement operates in practice (i.e. whether the legal tests of employment are met).
  • Employment status is important because it determines an individual's legal rights and an employer's obligations towards that individual.
  • Employers should decide how the relationship will operate in practice, apply the corresponding employment status and accurately reflect this in the contract.
  • Contracts should specify the employment status, rights and obligations of zero hours staff and confirm basic terms, including pay, holiday entitlements, notice and other terms which relate to the way work will be managed.
  • Employers should regularly review working arrangements to assess whether the way in which individuals are working has implications for their employment status. If their status has changed, the employer should consider issuing a new contract to reflect this.
  • Exclusivity clauses in zero hours contracts, used to tie workers into working for only one employer even when no work is offered, became unenforceable in May 2015. Zero hours employees have the right not to be unfairly dismissed and zero hours workers have the right not to suffer detrimental treatment for working elsewhere.

Recent developments

2020 coronavirus outbreak and furlough

As a result of the 2020 coronavirus outbreak, organisations are able to place staff on furlough. This It essentially means putting employees on temporary leave of absence where they do no work and receive no pay, but they are retained on an organisation's books to be brought back in when needed.

Whilst furlough traditionally means that the affected employee will receive no pay, the Job Retention Scheme provides a grant from the Government to cover 80 per cent of furloughed employees’ wages, currently to a maximum of £2,500 per employee per month, so the employer will need to continue to pay this (or a higher amount of if it chooses) to the employee.

On 26 March 2020, it was confirmed that zero hour workers are able to benefit from this. 

For more information, please refer to our FAQs on Furlough and the Job Retention Scheme.

Consultation looks at new rights for all flexible workers

A government consultation examined whether new laws should be introduced to protect flexible workers and prevent 'one-sided flexibility'. Specifically, it asked for views from flexible workers who have experienced these practices in organisations. The consultation considered:

  • introducing compensation for workers who have shifts cancelled at short notice
  • providing workers with a reasonable period of notice of assigned shifts
  • protecting workers against detriments if they decline shifts which are offered on short notice.

The consultation closed in October 2019. The government has yet to publish its official response, with a delay likely due to the 2020 coronavirus pandemic.

New right for all workers to request a more stable contract

An independent review into modern ways of working, and the use of flexible ways of working such as zero hours contracts, was carried out by Matthew Taylor and resulted in the Good Work Review which was published in July 2017.

Following a consultation on this matter, the government’s ‘Good Work Plan’ released in December 2018 confirmed that legislation will be introduced to create a new right for all workers to request a more predictable and stable contract. The worker can decide whether they wish to make a request for a fixed working pattern once they reach 26 weeks’ continuous service with the organisation.

It has not yet been confirmed when this new right will come into force.