UK200Group members comment on zero hour contracts

Members of the UK200Group of independent accountancy and law firms have commented on the government’s latest guidance on zero hour contracts. The document underlines the responsibilities of businesses reliant on the practice, stating it ‘should not be considered as an alternative to proper business planning and should not be used as a permanent arrangement if it is not justifiable’.

Jonathan Russell, partner at UK200Group member firm ReesRussell, said:

“The government should be pleased with zero hour contracts. In the main, this is responsible employers ensuring the periodic and variable hour employees are caught in the PAYE net. Zero hour contracts have to a large degree replaced the old casual labourer who may well have been paid in cash outside of PAYE. It is all very well for government to talk about effective use of overtime, but with a maximum working week entirely in the employee’s control, this option is not as readily available as it was. Zero hour contracts have received bad press because a minority of employers using them have inserted unfair clauses or used them inappropriately, but that in itself does not make zero hour contracts bad. The guidance issued by government is welcomed and does quite correctly set out the objectives of such contracts and possible alternatives to consider. One wonders whether NHS trusts would agree that the use of agency staff is a sensible commercial solution.”

Duncan Montgomery, tax partner at UK200Group member firm Whittingham Riddell, said:

“Zero hours contracts are generally not good for employees or employers, and only occasionally useful. The reality is that we have always seasonal workers and while the Department for Business, Innovation and Skills use that as an example, the reality is that the zero hours contract only puts into language the more casual practices that existed before for the bank of employees that were called in from time to time or from agency. The fact that exclusivity clauses are now specifically prohibited is excellent as it means that employees can take alternative work. The reality is that employees are valuable when they do work that pays at a good rate of knots for the team and that is the safest protection an employee can have. Sure, there are people who will take advantage but for the most part, hard-working, capable people should in fact be valued by employers in what is a tight marketplace.”