Cable Consults on Zero Hours Contracts

Martin Couchman Deputy Chief Executive British Hospitality Association

Martin Couchman
Deputy Chief Executive
British Hospitality Association

The topic of ‘zero hours contracts’ continues to dominate the headlines, creating controversy and debate the length and breadth of the country.  The contracts defined as “an employment contract in which the employer does not guarantee the individual any work, and the individual is not obliged to accept any work offered.” are, claims Business Secretary Vince Cable, open to exploitation.  Meanwhile, leisure and hospitality industry leaders including the BHA, have suggested there is a strong business case for keeping the agreements, which can be mutually beneficial for both employers and employees.

In the latest instalment, Cable chose the Friday before Christmas to launch his consultation paper on zero hours contracts (ZHCs).  As widely anticipated, the consultation focuses on two issues: ‘exclusivity clauses’ preventing an individual from working for another employer even if the current employer is offering no work; and ‘transparency’ because “individuals are not always clear on the terms, conditions and consequences of a [ZHC] and employers do not always fulfil or understand their responsibilities.” The consultation offers these options:

…Exclusivity Clauses
Banning them where no hours are guaranteed; as an alternative, Government-issued guidance (but what status would it have in Tribunal cases?); employer-led codes of practice; and simply relying on the existing rights of employees to challenge their employment terms.

…Transparency
Government providing more information and guidance on employment contracts and rights and on zero hours workers’ entitlement to benefits; an employer-led code of practice on the fair use of ZHCs, including, e.g., best practice in explaining the implications in job adverts; and model clauses on ZHCs, produced by government.

…Verdict:
The percentage of hospitality workplaces using ZHCs rose from 4 per cent in 2004 to 19 per cent in 2011, the largest rise of any sector, but the consultation acknowledges that ZHCs “can support business flexibility, making it easier to hire new staff and providing pathways to employment for young people.” Also, we do not think exclusivity clauses are widely used in hospitality, so any impact is more likely in the transparency area.

…Your Views Please let us have your views: email martin.couchman@bha.org.uk by 28 February.

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