Ban on Zero Hours Contracts Exclusivity Clauses: Government Considers Measures to Tackle Avoidance

Following on from the Government’s announcement that it plans to ban exclusivity clauses in zero hours contracts, it has issued a further consultation to “ensure that any potential loopholes that could be used to avoid that ban are closed”. 

The consultation seeks views on a range of potential actions the Government could take to tackle avoidance, as well as considering routes of redress for employees.

The Government is seeking views on:

• The probability of employers seeking to evade the ban and how they might to do this;
• Whether it should do more to deal with potential avoidance and, if so, by what method – for example through a code of practice or legislation;
• Whether it should act now to counter potential avoidance or wait and monitor employer activity after the ban is implemented;
• Whether consequences for employers who evade the ban are necessary and if so, what they should be - for example criminal/ civil penalties or complaints by employees to the employment tribunal for detrimental treatment; and
• Whether there are any unintended consequences resulting from the wording of the legislation.

In terms of information, advice and guidance on zero hours contracts, rather than a single code of practice the Government is contemplating that business representatives and unions should work together, alongside the government, to establish sector-specific codes of practice on the fair use of zero hours contracts. Potential topics to cover could include when and when not to use a zero hours contract; how to promote clarity (for example job adverts and contracts stating the type of contract up front); the rights and responsibilities of both parties; how to calculate accrued benefits such as annual leave; and best practice when allocating work. 

The Government will also review existing guidance with a view to improving the information available to individuals and employers on using these contracts.

Responses to the Consultation Banning Exclusivity Clause: Tackling Avoidance are required by 3 November 2014.