Government considers ban on exclusivity clauses in low paid workers’ contracts

The Government has issued a consultation seeking views on its proposals to ban exclusivity clauses in low paid workers’ contracts. Under the proposals being considered, where a worker’s guaranteed weekly income is less than the Lower Earnings Limit (currently £120 a week,) any provision in their contract which stops them working for another employer will be void. The intention is to allow low-income workers who are not able to secure the number of hours they would like from their current employer to seek additional work elsewhere.  

To allow businesses to protect their interests where they employ well-paid individuals who only work a few hours a week, the Government proposes an exemption from the ban where an individual’s wages exceed an hourly wage cap. The consultation proposes a cap of £20, £22, or £29 an hour and the level of the cap would be reviewed regularly to ensure it remains relevant.

Employees dismissed and workers subjected to detrimental treatment for failing to comply with an exclusivity clause would be able to bring employment tribunal claims. 

The deadline for responses to the consultation on measures to extend the ban on exclusivity clauses in contracts of employment is 26 February 2021.