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A zero hours contract is essentially a contract of employment where the employer is not obliged to provide any work but the worker should be available for, and is expected to perform any work offered. The worker is only paid for the hours they work.
This is different to a casual worker who is not an employee, and therefore has far fewer employment rights than employees. With casual workers as well as there being no obligation to provide work the casual worker is not obliged to do work if requested. Casual workers do not have the same rights as employees, for example they do not have the right to be unfairly dismissed or be paid statutory redundancy pay.
This type of contract is useful for employers who have unpredictable requirements for staff, but who want to maintain a pool of suitable available individuals to offer work to when necessary. Businesses also defend the use of these contracts on the basis that they can provide valuable work opportunities for those who would otherwise be unemployed.
The Office for National Statistics has revealed that the number of people working under a zero hours arrangement has grown to 200,000 between October and December 2012, an increase from the 150,000 in the same period in 2009. However, ONS has admitted that this number was likely to be under-estimated due to employees not reporting the information on the types of contracts they use.
One point to note is that the unions and the Labour Party in the UK have criticised the use of these types of contracts, claiming that they leave workers in an uncertain position without permanent or regular work. Business Secretary, Vince Cable, has also said that the use of this type of contract is to be reviewed.
Pam Loch, Managing Partner of niche employment law practice, Loch Associates Employment Lawyers and Managing Director of HR Advise Me Limited.
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