‘Zero Hours’ contracts are here to stay

The public consultation on the use of zero-hours contracts in Northern Ireland closed at the end of September 2014. Following the consultation process, Minister Farry announced this week that an outright ban on 'zero-hours' contracts will not be introduced in Northern Ireland and stated that '[s]uch a ban could have unintended consequences in relation to individuals and employment opportunities'. Minister Farry was commenting after a briefing to the Department for Employment and Learning Committee, and indicated that he was considering introducing a package of measures aimed at protecting vulnerable workers who are engaged on zero-hours contracts.

Is this more red-tape for employers?
At this time, detail around the proposed measures is limited but we understand that the Minister is considering the following:

  • a ban on exclusivity clauses within a 'zero hours' contract. These clauses prevent an individual from carrying out work for another employer, and it has been argued that such clauses are unfair, particularly where a worker is receiving no work under the 'zero hours' contract and is still prevented from seeking engagement elsewhere;
     
  • introducing a Statutory Code of Practice to provide greater clarity and transparency around these types of contracts and to address the lack of awareness on the topic;
     
  • introducing a requirement on employers to provide an objective reason as to why an individual's 'zero-hours' contract should not be converted into a formalised contractual agreement guaranteeing a minimum number of hours' work each week after a certain period of time; and
     
  • placing an obligation on employers to review regular working patterns and convert 'zero hours' contracts into 'fixed-term' contracts where this was more appropriate. Fixed-term contracts provide greater security for the worker as they guarantee a fixed number of hours' work per week/per month.

Of course the real implications for employers, particularly those in the retail and healthcare sectors who place heavy reliance on the use of zero-hours contracts, will not become fully apparent until we see detail of the proposed measures.

For further information please contact a member of our Employment team, A&L Goodbody, Northern Ireland.

Date published: 20 February 2015