7 tips for introducing zero hour contracts in your SME

Top tips for SMEs
Top tips for SMEs

1. Make sure you understand the legal rights and responsibilities that will apply to these contracts – there are a lot of misunderstandings out there; for example, that zero hours workers aren’t entitled to paid holidays. The way that a zero hours arrangement is used in practice could also result in a worker being legally regarded as an employee, with corresponding employment rights.

2. Be aware that uncertainty around guaranteed hours can sometimes bring a sense of insecurity, with implications for morale and potential knock-on effects for the business and its customers.

3. Think carefully about the types of situations where it might be appropriate to use these contracts and consider overall whether zero hour contracts are the best option for your requirements. There may be better options more suited to achieving the type of employment relationships that your own business needs.

4. Where the decision has been taken to use zero hour contracts, make sure that the zero hour workers and their managers are clear about their rights and responsibilities, to avoid misunderstandings occurring later on.

5. If you have two types of contract in operation, for example full-time working alongside zero hour workers, misunderstandings can arise. Make sure everyone is clear about their own situation, and that they get on well together in the workplace.

6. Managers should be clear that restricting work opportunities (‘zeroing down’) should not be used, for instance, to discourage workers from raising concerns. Always encourage constructive dialogue in the workplace to air concerns or misunderstandings.

7. If in doubt seek advice from Acas or an employment law professional.

In tomorrow’s instalment of our Zero Hour series, we hear from Gerwyn Davies, Labour Market Adviser of the CIPD about how these types of contracts can affect people’s working lives…