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The rise of the 'zero-hours' contract

There's been a sharp increase in recent years in so-called 'zero-hours' contracts, as employers try to find cost-effective ways of meeting short-term staffing needs.

Increasingly, many companies in the retail and hospitality industries are taking on staff on 'zero-hours' contracts - that is, where people agree to be available for work as and when required, but have no guaranteed hours or times of work. Zero-hours contracts effectively provide employers with a pool of people who are 'on-call' and can be used when the need arises.

Generally, as an employer, you are not obliged to offer work to workers on zero-hours contracts - but nor are they obliged to accept any work you offer. It's important to be aware of the provisions of the National Minimum Wage Regulations, which state that workers on 'stand-by time', 'on-call time' and 'downtime' must still be paid the National Minimum Wage if they are at their place of work and required to be there. Similarly, such time is likely to count as 'working time' under the Working Time Regulations if the worker is required to be on-call at the place of work. This means that it's against the law to ask employees to 'clock off' during quiet periods but still remain on the premises.

Zero-hours contracts may suit some people who want occasional earnings and are able to be entirely flexible about when they work. However, the unpredictable nature of working times means that they won't be for everyone. If you are considering taking on people on a zero-hours basis, it's important to be aware of your responsibilities as an employer and to set out the terms of any contract clearly.

Acas provides comprehensive guidance in our Advisory booklet - Flexible working and work-life balance and training in drawing up contracts of employment. Acas experts can also visit your organisation to help you understand what needs to be done to address a range of issues related to Contracts and hours: how Acas can help you to develop practical solutions.

Visit the Acas Training and Business Solutions area for more information.

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