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Exclusivity in zero-hour contracts? Not anymore!

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Zero-hour contracts have been in the news again recently, this time because they are included in the Small Business, Enterprise and Employment Bill which has started its long passage through Parliament. The Bill addresses the specific issue relating to exclusivity in such contracts, which the government is proposing to ban.

Some organisations, when using zero-hour contracts, prohibit the worker from working for another employer for the duration of the contract, whether any work is provided under that contract or not. In essence this requires the worker to be available for work for that employer whilst having no certainty of even a minimum level of work being provided and yet at the same time being restricted from working for anyone else.

This is seen as inequitable and contrary to the government’s objective to get people back into gainful employment to reduce the benefits bill, and the government is keen to be seen to act to gain some political brownie points.

It is proposed that in future, such exclusivity clauses will be unenforceable (although the government has not yet indicated when the change is likely to come into force) as they restrict the freedom of a worker to work and to earn. Further, any clause restricting an individual from working for another organisation, unless prior agreement is given, will also be unenforceable. Zero-hour contracts will, however, remain a useful and lawful tool for recruiting flexible labour.

Although the final implementation date for this new law is unknown, the Bill is now unlikely to alter and it would be sensible to review any exclusivity clauses that you do have in place, in preparation for removing them.