0 Hour Contract Meaning: Everything You Need to Know
The 0 hour contract meaning is a type of employment contract that does not provide the worker with a guaranteed number of work hours.3 min read
The 0 hour contract meaning is a type of employment contract that does not provide the worker with a guaranteed number of work hours. This means the worker may work a different number of hours on a week-to-week basis. Workers have the right to accept or decline these hours, but if they decide not to work, they won't be paid.
If you sign a zero-hour contract, you'll be entitled to the following benefits:
- Guaranteed national minimum wage pay.
- Holiday leave and holiday pay.
- Allotted break times during your shifts.
- Pay for maternity, paternity, and adoption periods (but no guaranteed leave).
- Pay for any accrued holiday pay when you quit.
- Lack of a required notice period when choosing to quit.
Research from the Office of National Statistics suggests that women and those going to school full time are the people most like to be engaged in a zero-hour contract. Additionally, most people in zero-hour contracts are either under 25 or over 65.
Differences Between Zero-Hour Contracts and Traditional Contracts
Zero-hour contracts are a little different than traditional contracts, as they offer employees a different set of rights. The biggest difference between the two is that people on traditional contracts are called employees, while people on zero-hour contracts are called workers. What's the difference between an employee and a worker?
- A worker is able to reject or accept extra hours as offered. Rejecting work hours should not result in extra penalties (such as a lack of hours offered in the future).
- An employee has set hours that are stated in the contract. This means they cannot reject work given to them if it meets the terms of the contract.
Knowing the difference between these two is essential for the knowing the exact rights you have when it comes to your employment.
Things to Look for in a Zero-Hour Contract
Before signing a zero-hour contract, always consider the following items to make sure of what you're getting into.
- Make sure there isn't a stipulation in the contract that specifies you have to take the hours offered to you. Chances are, you'll have to turn down shifts at some point, and you don't want to violate the contract when you do.
- Look for a section on holiday pay. Otherwise, your employer will not be obligated to pay you on these days, and you'll miss out on valuable income.
- Check to see whether the contract calls you a worker or an employee. As mentioned above, there's a big difference between the two.
Benefits and Drawbacks of a Zero-Hour Contract
Zero-hour contracts have both benefits and downsides. Some of the benefits include:
- Flexible working hours, perfect for students who need to work around their class schedules.
- Saving money, as businesses will only need to pay the workers they need for specific shifts.
Some of the cons of a zero-hour contract include:
- Not having a steady or reliable income, as you work varying shifts.
- Abuse from employers trying to take advantage of your flexibility.
- Not getting any hours from your employer.
- No contribution to a pension.
- Getting only a few-hours notice ahead of your scheduled shift.
- No severance pay if you are let go.
- Trouble getting a mortgage or opening a credit card.
- Difficulty arranging childcare.
Overall, employers benefit more from these types of contracts than workers.
How Employers Can Use Zero-Hour Contracts
Zero-hour contracts offer employers extreme flexibility when scheduling their workforce, especially if they only need a temporary boost in workers. Some examples of when this might come in handy are:
- If an employer is hosting a last-minute event and need staff just for that particular occasion. An example of this is a caterer who wins a contract for a wedding.
- If an employer offers niche services that don't require full-time employees. For example, a translation agency wouldn't need full-time employees for every language, as they won't always have projects available. However, they might need workers standing by in case a specific project comes in.
If the worker is doing a good job and the employer's need for help continues, they may consider upgrading the worker to an employee. However, this all depends on their relationship.
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