Zero hours contract workers

The rights of someone with a “zero hours contract” (ZHC) depend on whether they are an employee, a worker or self-employed, applying the tests described on pages 32-35.

In a typical arrangement for casual or zero hours work, the written contract terms state that the employer is not obliged to offer any work and the worker is not obliged to accept it. Increasingly, the written documentation spells out that the employer does not guarantee any hours, often describing the hours as “zero”, or “hours to be agreed”. The employer only agrees to pay for hours worked.

One of the main attractions of the ZHC for employers is the potential to avoid employment liabilities. However, in reality, most people on a ZHC are entitled to at least basic statutory “worker” rights (see page 31), for at least the hours when they are working. This includes paid statutory holiday and the National Minimum Wage and protection from discrimination.

This is because even if an employer has no obligation to provide work and an individual has no obligation to accept it, as soon as that individual accepts a shift or assignment in return for reward, this creates a legal contract for the duration of that shift. As long as the individual is obliged to perform the work personally (i.e. not through a substitute or a limited company) they will be a “worker” (see page 33).

Some rights, such as the right to statutory maternity pay or statutory sick pay, depend on a worker earning above the Lower Earnings Limit (£112 for 2015-16) from a single employer. Some ZHC workers will not meet this threshold, especially if they have more than one job, as the wages are not aggregated together. For similar reasons, many ZHC workers will fail to qualify for pension auto-enrolment (see page 98).

Some casual and ZHC workers qualify as employees (see pages 32 to 35). As employees they are entitled to better rights (see page 31).

Some employee rights depend on continuous service, but many important employment rights require no service, including most claims for automatically unfair dismissal, trade union-related rights and many significant parental rights (see Chapter 8).

Where rights depend on continuous service, ZHC employees are likely to struggle. As explained in Chapter 3, employment tribunals must look at all the circumstances, including the parties’ unequal bargaining relationship, when deciding what contract terms have been agreed (Autoclenz v Belcher [2011] UKSC 41). This means that even if a written contract describes the hours to be worked as “zero” or “casual as required”, as long as the worker can show a working pattern of regular hours over a long period, an employment tribunal may decide that their service has been continuous. This would be on the basis that in between each shift or assignment when the individual is not working, there is an “umbrella” or “overarching” contract of employment, obliging the employer to offer some work, and the employee to accept it. In practice, this is very difficult to establish. For an example see the case of Pulse Healthcare Limited v Carewatch Care Services Limited & Others [2012] UKEAT 0123/12/2007.

Sometimes the statutory rules on continuity of employment can help to bridge gaps in service for ZHC workers. These rules, found in sections 210 to 219 of the ERA 96, are summarised on page 311, Chapter 10.

In reality, there are many practical barriers to the enforcement of these rights, not least the risk of retaliation, with hours being “zeroed-down” or future assignments being withheld.

Another possible source of rights for some ZHC workers will be the Part-time Workers Regulations 2000 (PTWR), summarised on page 46. A “part-time worker” is defined as “any worker whose hours are less than those of a full-time worker”. This definition is wide enough to include ZHC workers. However, claimants must be able to identify a real full-time comparator, not a hypothetical one (Carl v University of Sheffield [2009] UKEAT/0261/08/CEA).