Malcolm ZoppiWed May 29 2024

Zero-Hours Contract Explained: What are employee rights on a zero hour contract UK?

Zero-hour contracts are a popular choice for employers and workers in the UK, offering flexibility in various sectors. But do employees on these contracts have the same rights as those on permanent contracts? Are they entitled to the same benefits and protections? In this article, we delve into the rights and entitlements of employees on […]

Zero-hour contracts are a popular choice for employers and workers in the UK, offering flexibility in various sectors. But do employees on these contracts have the same rights as those on permanent contracts? Are they entitled to the same benefits and protections? In this article, we delve into the rights and entitlements of employees on zero-hour contracts in the UK, exploring the key features of these contracts and the legal protections that employees are entitled to. So let’s uncover the truth about employee rights on zero-hour contracts in the UK.

Key Takeaways:

  • Zero-hour contracts are a flexible option for employers and workers in the UK.
  • Regardless of the type of contract, employees and workers in the UK are entitled to certain employment rights, including the National Minimum Wage, paid holiday, rest breaks, and protection against discrimination.
  • The employment status of workers on zero-hour contracts determines their rights and entitlements.
  • Employees on zero-hour contracts have additional rights, such as protection against unfair dismissal.
  • Workers on zero-hour contracts have the right to work for other employers and cannot be dismissed solely for working elsewhere.

Employment Status and Rights

The employment status of workers on zero-hour contracts determines their rights and entitlements. In the UK, workers can be classified as employees or workers. Employees have additional rights compared to workers, such as redundancy pay, maternity leave, flexible working, and protection against unfair dismissal. Both employees and workers are entitled to the National Minimum Wage, paid holiday, rest breaks, and protection against discrimination.

To ensure compliance with employment laws, employers must properly determine the employment status of their workers. This determination is based on various factors, including the level of control the employer has over the worker, the nature of the work and tasks, financial risk, equipment requirements, and payment arrangements.

Understanding the differences between employees and workers is crucial for employers. It allows them to provide the appropriate rights and protections based on the employment status. Here is a comparison of some key rights and entitlements:

Employment StatusEmployeeWorker
Redundancy PayYesNo
Maternity LeaveYesNo
Flexible WorkingYesNo
Protection against Unfair DismissalYesNo

By properly determining employment status and providing the appropriate rights and protections, employers can ensure a fair and equitable working environment for their employees or workers on zero-hour contracts.

Detriment and Dismissal

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Employers must not cause detrimental treatment to workers on zero-hour contracts for asserting their rights or making claims for equal treatment. Detrimental treatment can include reducing hours, bullying, harassment, denying training opportunities, or overlooking promotions.

Employees on zero-hour contracts are protected against unfair dismissal, meaning they cannot be dismissed for reasons connected to their contract. For example, if an employee is dismissed for providing evidence that shows discrepancies in the treatment of zero-hour workers compared to permanent employees, it can be considered automatic unfair dismissal.

On the other hand, workers on zero-hour contracts do not have the right to claim unfair dismissal. However, they may be able to argue that the termination of their contract was a detriment. This area of employment law can be complex, and legal advice may be necessary to navigate the specific circumstances and determine the appropriate course of action.

Working for Multiple Employers

Workers on zero-hour contracts in the UK have the right to seek and accept employment from multiple employers. This means that if you are on a zero-hour contract, you are not limited to working for a single employer. The Employment Rights Act 1996 prohibits employers from including exclusivity clauses in zero-hour contracts that prevent workers from seeking work elsewhere.

An exclusivity clause is a provision in a contract that restricts a worker from working for other employers. However, under the Employment Rights Act 1996, such clauses are unenforceable in zero-hour contracts. Employers cannot treat workers unfavourably or dismiss them solely because they are working for multiple employers.

This protection ensures that workers have the flexibility to have multiple sources of income and to choose employment opportunities that suit their needs. It recognizes that zero-hour contract workers often rely on multiple employers to secure enough work and income.

Here’s an example to illustrate the concept:

WorkerEmployer AEmployer BEmployer C
John20 hours per week15 hours per weekNo hours
JaneNo hours30 hours per week10 hours per week

In the above example, John works for multiple employers, splitting his time between Employer A and Employer B. Jane also works for multiple employers, dividing her hours between Employer B and Employer C. This arrangement allows both workers to have a more stable income by having multiple sources of work.

By protecting the right to work for multiple employers, the UK employment law aims to provide flexibility and financial security for workers on zero-hour contracts.

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Notice Period and Contract Termination

When it comes to zero-hour contract workers, the notice period can vary depending on their employment status. Employees are required to adhere to the notice periods specified in employment law, while workers do not have a legal obligation to give or receive notice. However, employers have the option to include a notice period in the written contract if they so choose.

During the notice period, the working arrangement remains the same. This means that the employer is not obligated to provide a minimum number of working hours, and the worker is not required to accept any work that is offered.

Continuous employment, without any breaks, plays a significant role in determining certain rights and entitlements for zero-hour contract workers. For example, after one year of continuous employment, workers may not need to accumulate holiday entitlement before taking time off. On the other hand, employees who have completed two years of continuous service have the right to make an unfair dismissal claim.

It is important to note that when a zero-hour contract is terminated, the employer bears the responsibility of paying any accrued holiday pay and outstanding wages.

Conclusion

In conclusion, zero-hour contracts offer employers and workers flexibility in various sectors, but it is crucial for employers to prioritize the rights of their employees or workers. Both employees and workers on zero-hour contracts are entitled to important benefits, such as the National Minimum Wage, paid holiday, rest breaks, and protection against discrimination. The specific rights and entitlements vary based on the employment status, with employees having additional protections like redundancy pay and maternity leave.

Employers must not subject workers on zero-hour contracts to detrimental treatment and cannot dismiss employees for reasons related to their contract. Workers on zero-hour contracts have the freedom to work for multiple employers, and exclusivity clauses are not enforceable. When it comes to the termination of zero-hour contracts, employers must adhere to employment laws regarding notice periods and consider the rights and entitlements of the individuals involved.

By understanding and following the relevant regulations, employers can ensure compliance and establish a fair and transparent working environment for their employees or workers on zero-hour contracts. It is crucial to respect employee rights and worker rights, creating a positive and mutually beneficial working relationship.

FAQ

What rights does an employee have on a zero-hour contract in the UK?

Employees on zero-hour contracts in the UK have the same rights as employees on other types of contracts. These rights include the National Minimum Wage, paid holiday, rest breaks, protection against discrimination, and protection against unfair dismissal.

What is the difference between employment status and worker status?

Employment status refers to individuals who have a contract of employment and are considered employees. They have additional rights, such as redundancy pay and maternity leave. Worker status includes individuals who work under a contract, but they may not be classified as employees. Workers are entitled to the National Minimum Wage, paid holiday, rest breaks, and protection against discrimination.

Can a worker on a zero-hour contract claim unfair dismissal?

Workers on zero-hour contracts do not have the right to claim unfair dismissal. However, they may be able to argue that the termination of their contract was a detriment, which can include reduction in hours or other unfair treatment.

Can an employer prevent a worker on a zero-hour contract from working for other employers?

No, employers cannot prevent workers on zero-hour contracts from working for other employers. Exclusivity clauses that attempt to restrict workers from seeking or accepting work elsewhere are unenforceable, and employers cannot treat workers unfavorably for working for multiple employers.

Is there a notice period required for terminating a zero-hour contract?

Workers on zero-hour contracts do not have a legal requirement for notice periods. However, employers may choose to include a notice period in the written contract. Regardless, when a zero-hour contract is terminated, the employer must pay any accrued holiday pay and outstanding wages.

What are the key points to consider about zero-hour contracts and employee rights?

Zero-hour contracts provide flexibility for employers and workers, but it is essential for employers to respect the rights of their employees or workers. This includes ensuring compliance with employment law, providing the appropriate rights and protections based on the employment status, not causing detrimental treatment to workers, and understanding the notice period and termination of zero-hour contracts.

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Disclaimer: This document has been prepared for informational purposes only and should not be construed as legal or financial advice. You should always seek independent professional advice and not rely on the content of this document as every individual circumstance is unique. Additionally, this document is not intended to prejudge the legal, financial or tax position of any person.

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Whether you require specialised knowledge for your business or personal affairs, Gaffney Zoppi can support you.