This email is all about zero hours contracts and their proposed ban so if you’re not using them in your business and you’re unlikely to in the future, you are more than welcome to abandon this email right here.

If zero hours contracts are your bag..

Read on…Much has been made of the Government’s plans to “ban” zero hours contracts – read more Many small businesses, particularly those in retail and hospitality, have panicked when they heard that they would be left without the flexibility of zero hours contracts they’ve come to rely on.

What’s actually being proposed?

The Government has dedicated 11, yes that’s 11, pages of the Employment Rights Bill to their proposal which they’re calling the right to guaranteed hours. 

Really important to note that despite the 11 pages of words, there’s very little meaningful detail; all of the crucial details are left to be specified by future Regulations. So it’s currently not possible to tell how significant this new right will actually be and how far it will go towards a ban on zero hours contracts.

What we do know

The new provisions will oblige employers to review their casual or zero hours working arrangements on a regular basis.

If it happens that one of their “qualifying workers” has a working pattern over a yet-to-be-clarified reference period reaches a yet-to-be-clarified threshold, the employer will have to offer that person a contract with guaranteed hours. In other words, there will be “tests” to apply to each working pattern to ensure that the arrangement  can remain casual instead of moving to be guaranteed hours.

In fairness, this has always loosely been the case and it’s certainly something I’ve always advocated. For example, if you have an employee on zero hours who works pretty much the same hours each week and each month then come on, technically that’s not a zero hours contract is it. To be truly zero hours, the number of hours offered and worked should show some variation from week to week or month to month. Otherwise, really, it could be a cheap way to get away with exercising the right to vary hours on an occasional basis.

What we don’t know

Um, a shedload. Especially the actual detail.

The reference period. It MIGHT be 12 weeks and there’s certainly precedent for a 12 week reference period to be used because of other employment law arrangements elsewhere, e.g. when calculating redundancy entitlement for casual or variable hours employees.

The threshold. That’s completely up in the air and, depending on what it ends up being, could mean that employers need to continually monitor the hours they’re offering so they don’t inadvertently breach the provisions of the right to guaranteed hours.

 Will it have any impact?

It’s clear that not only is the proposal hugely complex, it’s also lacking in so much detail. The Government has quite a challenge ahead to translate the legislation into guidance that any employer can follow.

Also, let’s remember that while many huge businesses use zero hours contracts, they’re also used by very small businesses who may struggle even more to make sense of what they’re supposed to do and when. 

Next steps

For now, anyone using zero hours contracts needs to be aware that the arrangements will change (although guess what, the changes are coming at a yet-to-be-clarified point in the future!). 

And of course, I can’t stress enough that when the consultation comes, it will be really important to take time to respond. 

As small business owners, we CANNOT complain about the Government legislating on things that matter to us if we do not take the opportunity to have our say. It’s that simple. 

In the meantime, if you’re at all worried about your zero hours contracts or you want to have a chat about anything, just give me a shout!