Overview

This bill aims to significantly reduce the use of zero-hours contracts in the UK by introducing various measures to improve the rights and protections of workers employed under such contracts. Key changes include stricter definitions of zero-hours contracts, requirements for minimum notice periods, and a right for workers to request fixed-term contracts after a certain period.

Description

Defining Zero-Hours Contracts:

The bill defines a zero-hours contract as one that doesn't guarantee minimum working hours or requires availability exceeding guaranteed hours by more than 20%. Overtime, with a premium of at least 50% of the standard hourly rate, is excluded.

Contract Information and Notice:

Employers must provide workers with written notice of minimum hours before the contract starts (or within seven days if initially oral). Failure to provide this notice deems the worker to be on a zero-hours contract for the purposes of this act.

Equal Treatment:

Zero-hours contract workers must be treated equally to comparable workers on fixed-term contracts in terms of pay and conditions, except for working time allocation.

Reasonable Notice:

Employers must give at least 72 hours' notice for work assignments or cancellations. Failure to do so results in penalty payments of 150% of the usual rate or full payment for cancelled shifts.

Requests for Fixed-Term Employment:

Zero-hours contract workers can request fixed and regular working hours. Employers must respond within five working days, giving priority to the worker's interest, and can only refuse for compelling business reasons (not including a simple desire to use zero-hours contracts). Refusal can be challenged at an employment tribunal.

Automatic Offer of Fixed-Term Employment:

After 12 weeks of continuous employment or 12 weeks within a 26-week period, employers must offer zero-hours contract workers a fixed-term contract with terms at least as favorable as their highest hourly rate during the relevant period and a minimum number of hours worked.

Prohibition of Exclusivity Clauses:

Exclusivity clauses in zero-hours contracts are void, unless the employer can demonstrate compelling business reasons, such as confidentiality.

Detriment and Unfair Dismissal:

It's unlawful for employers to penalize workers for being on zero-hours contracts, requesting information or fixed-term contracts, or refusing work offered with insufficient notice. Unfair dismissal is similarly defined.

Government Spending

The bill doesn't directly state the cost. Increased employment tribunal cases and potential compensation payments may lead to increased government expenditure related to the administration of justice, but no figures are provided in the text.

Groups Affected

Zero-hours contract workers: Will gain enhanced rights regarding notice, equal treatment, and the ability to request fixed-term contracts.
Employers using zero-hours contracts: Will face increased administrative burdens and potential financial penalties for non-compliance.
Employment tribunals: Likely to see an increase in the number of cases related to zero-hours contracts.
The government: May experience increased costs related to employment tribunal processes and compensation.

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