By Richard Cummings, HR Insight
It is important to note that workers on zero-hours contracts still have the same basic worker rights including:
• To be paid the National Minimum Wage including during work-related travel time
• To receive annual leave at the statutory level of 5.6 weeks per year prorated to their hours of work
• To refuse work when it is offered
Benefits of Zero Hours Contracts
Where true flexibility is a key requirement on both sides, where the employer has sufficient workers to call upon and the worker is not reliant on a regular income, zero hours contracts remains a viable option. This can be a more cost effective alternative to expensive agency arrangements or a risky employment relationship. For the worker there is genuine flexibility with few consequences if they decline work.
But what are the alternatives?
Casual Working Agreements
We would recommend the use of casual working agreements which operate in much the same way as zero hours contracts with no obligation to provide or accept work. These have similar benefits for workers but for the employer, the continuity of service is bro-ken between assignments. As with all casual working arrangements it is essential to monitor and change the contract where regular patterns of work arise.
Fixed Term Contracts
If the resource requirement is genuinely short term for example, to cover maternity leave, the fixed term contract can be very effective. The advantage for the employee is that they will be entitled to similar rights and benefits as compared to permanent staff. For the employer, they will have the security of a contract that will automatically come to an end, normally without the need to give notice, at a stated end date.
Agencies can provide supplies of workers to whom the business would have limited obligations for up to 12 weeks. Those obligations do increase after that time and agencies will charge fees for their services, but for short-term assignments, this can be a good way of dealing with fluctuating operational demands.
Contracts for Services
For projects or assignments that are short term and require specialist skills, the use of self employed contractors can be a viable option. Although more expensive, the business can expect the work to be completed within a specified time frame and to a defined professional standard. Errors and overruns should be completed at no further cost to the business and all work should be covered by the contractor’s insurance.
While further controls on zero hours contracts are inevitable, I would encourage companies to consider the advantages of the alternatives.