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Ban on Exclusivity Clauses in Zero-Hours Contracts

By May 26, 2015June 30th, 2015Legal Update

A ban on exclusivity clauses in zero-hours contracts is now in effect following the introduction of the Small Business, Enterprise and Employment Act 2015.

The introduction of the legislation means that an estimated 150,000 workers are now legally entitled to take work from more than one employer at a time. However the new legislation offers no protection for workers should they be disadvantaged for doing so.

Former Business Secretary Vince Cable announced the legislation in June 2014, saying at the time that the Government intended to crack down on “unscrupulous employers”.

Zero-hours contracts became a fierce battleground during the general election as each party tried to appeal to the estimated 1.8 million people employed in that way. As the Conservative Party stood by zero-hours contracts this is likely to be the last major change for some time – even though the lack of any punitive measures for flouting the ban means it will be effectively business as usual.

Research by the Office for National Statistics (ONS) found that on average employees on zero-hours contracts work for 25 hours a week. A third of those on such contracts said that they would want more hours of work, compared to just 10% of people in other forms of employment. Many zero-hours workers do not share the same rights as permanent employees such as the right to holiday pay, maternity leave or a pension.

For employers in industries such as events, hospitality and the care sector zero-hours contracts provide the opportunity to take on staff in response to demand. The new legislation is unlikely to affect employers with a large bank of zero-hours workers.

Some people may find a benefit to working on zero-hours contracts, such as students or older people looking to top up their income or find work that suits their own personal circumstances. However, the lack of security and protection means that nearly 2 million people in the UK cannot guarantee when and even if they will next be in work.

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