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How to make a Zero-hours contract

This document is GDPR compliant.

A clear zero-hours contract is vital where a business wishes to hire casual workers as and when they are needed and are not able to promise a set number of working days or hours or any future work. A good zero-hours contract will cover key areas such as the practical arrangements for how work will be offered and carried out, as well as clauses you would typically see in an employment contract like a place of work, hours, holiday, pay and termination arrangements. Exclusivity clauses in zero-hours contracts are now banned and unenforceable.

Use this zero-hours contract:

  • when you want to hire a worker on a casual or temporary basis to cover emergencies or unknown or changing demand
  • when you want the flexibility of workers who will not be promised set hours of work or any future work but are available when required
  • if the worker has other commitments (eg childcare or studying)
  • for workers based in England, Wales or Scotland

This zero-hours contract covers:

  • the type of work that will be offered to the worker and how it will be offered and carried out
  • terms relating to pay and benefits
  • the place of work, agreed hours and holidays
  • terms relating to sickness
  • arrangements for ending the agreement

A zero-hours contract is an agreement between a business and an employee where the business does not guarantee any set hours for future work. It sets out such things as the type of work that will be offered, terms relating to pay and benefits and agreed hours and holidays.

A zero-hours contract is useful when you cannot guarantee hours for employees or want them to have flexible working arrangements.

Zero-hours contracts are frequently used where the demand of work fluctuates, for unexpected or last-minute events, or for on-call/bank work.

The key difference between a zero-hours contract and an employment contract is that a zero-hours contract does not require an employer to offer work or for workers to accept it.

Individuals on zero-hours contracts can be workers or employees. This will depend on their employment status.

Zero-hours workers are entitled to basic employment rights such as annual leave, the National Minimum Wage and National Living Wage and pay for work-related travel in the same way as regular workers.

A zero-hours contract creates a 'worker' relationship. An employee relationship may be developed over a period of time. In most scenarios, zero-hours contracts mean that an employer recruits a 'worker' at first. However, the way the working relationship develops over time may enhance the employment status of the worker. The zero-hours contract reflects the intentions of the employer to only treat 'workers' as such as not full-time employees. In some circumstances, if a dispute arises in the Employment Tribunal, it has the power to decide the contractual relationship that exists between the employer and worker.

A worker under a zero-hours contract is entitled to annual leave (holiday pay), sick pay and the National Minimum Wage and National Living Wage. They don't normally have the 'employee' status, which would allow them to claim for unfair dismissal, maternity pay and leave, flexible working or statutory minimum notice.

An employer has the right to end this agreement immediately in writing if a worker has committed a serious breach of its terms or committed gross misconduct such as dishonesty, theft and misuse of drugs. A worker can terminate this agreement by informing the employer as soon as possible in writing that they no longer want to be considered their casual worker.

This document gives you the right to transfer employee data out of the UK or EEA. However, the employer can only transfer personal data outside of the UK or EEA if there are appropriate safeguards in place (eg the organisation receiving the data is certified under an approved certification mechanism). Such safeguards should be set out in the employer's Data protection policy. For further information, read International transfers of personal data

Ask a lawyer:

  • if you intend to create an employment relationship (ie between an employer and employee) under a zero-hours or other contract
  • for workers based outside England, Wales or Scotland

Other names for Zero-hours contract

Nil hours contract, 0 hour contract.