Zero hours contracts have been one of the main topics concerning employment lawyers in the last 18 months. I began writing about them in August 2013 when the Government estimated that some 250,000 people were working under such contracts.
However, the number of employees subject to such contracts has soared since then. The latest ONS Labour Force Survey (published on 15 February) has revealed that 697,000 were employed on a zero hours contract as their main source of employment in the three months to December 2014. Remarkably, this represents an increase of 100,000 in just that three months’ period.
Some commentators have suggested that zero hours contracts have been a symptom of the recession. However, their increased adoption during what we are told is a period of economic recovery strongly suggests that they are here to stay.
As I have commented before there is no legal definition of a “zero hours contract”. Rather, these working arrangements have emerged by custom and practice and there can therefore be unintended consequences.
Attention in this area has focused on Mike Ashley’s Sports Direct although other high profile zero hours employers include McDonalds, J D Wetherspoon, Burger King and Dominos Pizzas. However it is Sports Direct that has made the news once again this month.
Details have emerged of a claim by almost 300 employees who say that they were excluded from a bonus scheme because they were on zero hours contracts. If the claims are upheld they could cost Sports Direct about £10 million. In 2013 the scheme paid out about £160 million to 2000 permanent workers. This follows the same employer’s out of court settlement last October of claims for sex discrimination, unfair treatment and entitlement to holiday pay.