The expression “zero-hours contract” is a colloquial term for a contract of service under which the worker is not guaranteed work and is paid only for work carried out. It generally leads to “a form of working where the worker is not guaranteed any work but has to be available as and when the employer needs them”.
This note discusses zero-hours contracts: a type of contract used by employers whereby workers have no guaranteed hours and agree to be potentially available for work. They are used increasingly by companies seeking labour flexibility and by workers seeking flexibility around their other commitments.
ONS estimates there were around 1.7 million zero-hours contracts in November 2016, based on its latest survey of UK businesses. This was equivalent to approximately 6% of all employment contracts at the time.
This 1.7 million estimate excluded contracts with no guaranteed hours which did not provide work in the fortnight covered by the survey. These contracts (of which ONS estimates there were around a 1.9 million in January 20154) are harder to analyse, as they may include people who have several contracts with different employers, people who remain on an employer’s records despite having changed job, people who are sick or on leave or who do not want to work, as well as employees who would have liked to work but were not offered any hours.
Opinion on zero-hours contracts has been mixed. Employee organisations tend to argue that the contracts result in financial insecurity for workers who lack key employment rights; employer organisations stress their utility when seeking to meet fluctuating demand and argue that they play a vital role in keeping people in employment.
Prior to the 2015 General Election, the Coalition Government and the Opposition proposed measures to address concerns about the use of zero-hours contracts. Notably, section 153 of the Small Business, Enterprise and Employment Act 2015 and supporting regulations seek to prevent the use of “exclusivity clauses” in zero-hours contracts (i.e. prohibit a contractual requirement for a worker to work exclusively for one employer irrespective of the hours offered).
Chosen excerpts by Job Market Monitor. Read the whole story at Zero-hours contracts – Commons Library briefing – UK Parliament