The Exclusivity Terms in Zero Hours Contracts (Redress) Regulations 2015 (the Regulations) came into force on 11 January 2016. The Regulations can be found here. The Regulations provide statutory remedies for individuals who are dismissed or subjected to detriment as a result of a breach of an exclusivity clause in a zero hours contract.
The Regulations follow last year’s amendments to the Employment Rights Act 1996 which provided that any provision of a zero hours contract which prohibits a worker from doing work or performing services under another contract or under any other arrangement, or from doing so without the employer’s consent, is unenforceable. (These provisions are commonly called “exclusivity clauses”.)
The Regulations now make the dismissal of an employee who works under a zero hours contract automatically unfair, if the principal reason for the dismissal is that the employee breached an exclusivity clause. Further, a worker who works under a zero hours contract has the right not to be subjected to any other detriment by the employer because s/he has breached an exclusivity clause. There is no minimum period of service required for the worker to qualify for these rights. Normal time-limits for bringing a claim and other considerations apply in respect of an unfair dismissal claim by an employee under the Regulations.
Separately, a worker who has been subjected to detriment can bring a claim before the employment tribunal, provided that the claim is presented within three months after the event to which it relates (unless it is just and equitable for the employment tribunal to consider a claim after this period). If the employment tribunal finds the claim well-founded, it may make a declaration about the rights of the worker and the employer in relation to the matters to which the claim relates and/or order the employer to pay compensation to the worker. The amount of the compensation awarded will be that which the tribunal considers just and equitable in all the circumstances having regard to the infringement to which the claim relates and any loss which is attributable to the act, or failure to act, which infringed the worker’s right. In circumstances where the detriment is the termination of the worker’s contract, the maximum compensation which can be awarded is equal to the maximum unfair dismissal compensation which would have been awarded if the worker were an employee – currently a basic award of up to £14,250 and a compensatory award of the lower of 52 weeks’ pay or £78,335. The worker remains under a duty to mitigate his or her loss (and reductions to compensation may be made if the worker has caused or contributed to the act or failure to act which is being complained of).
The Department of Business, Innovations and Skills has confirmed that it has no current plans for further legislation about zero hours contracts.