Zero hour contracts

Over 1.8 million zero hour contracts are issued annually in the UK, but what does it actually mean if you’re on one? Will you earn enough money? And can you still claim benefits? We find out for you.

worried girl on phone

"Please say you're ringing to give me more hours?"

What is a zero hour contract?

Zero hour contracts mean you’re not guaranteed any work – and if you don’t work, you don’t get paid.

There’s no official legal definition for this type of contract, but it usually means that:

  • Your employer doesn’t have to find you work – they’ll only ask you to work if you’re needed.
  • You only get paid for the hours you work – so there can be times when you don’t get any money.
  • You can refuse work – your boss doesn’t have to offer it, but, on the flip side, you don’t have to accept it.
  • Your working pattern could vary – you might only work at certain times of year, or get more hours when things are busy.
  • You could actually get loads of hours – workers on zero hour contracts do 25 hours a week on average, according to government statistics.

Where am I likely to be offered a zero hour contract?

Zero hour contracts are often used for seasonal jobs and ones where demand for staff can go up and down. These include:

  • Retail – from high-street supermarkets to online shops
  • Catering and hospitality – including restaurants, pub chains, hotels and events like weddings
  • Tourism and leisure – including theme parks and cinemas
  • Security – sports grounds and music venues need more staff at busy times
  • Care work – which often involves working on-call

I’m on a zero hour contract. Do I have any legal rights?

You’re not guaranteed any work or pay, but you do have some rights. These include annual leave and the National Minimum Wage.

You also have the right not to be discriminated against, including if you’re pregnant – your boss can’t use that as a reason not to give you work.

Before signing a zero hour contract, it’s a good idea to make sure you understand what’s in it. Bogged down by legal-speak? Organisations like CAB and ACAS can help make sense of it.

I need more money! Can I work for another company?

This depends on your contract. It might say you’re not allowed to work for anyone else – even if you’re not getting any hours. This is called an exclusivity clause.

Employers are allowed to include these at the moment, but the rules should be changing soon:

  • Exclusivity clauses won’t count from early 2015 because the government has decided they’re wrong. “This is because they potentially limit your ability to earn a good wage,” says Chloe Themistocleous of JMW Solicitors.
  • If you’re asked to sign a contract that includes one, try asking them to take it out. “And if you’ve already agreed to this type of clause, it’s unlikely it will be enforceable in 2015,” says Chloe.
  • If you want to work for another company, Chloe says to tell your boss. “It’s always good practice to explain why you’re seeking work elsewhere,” she says. “Ask them to confirm they’re happy with you doing so to avoid any potential problems in the future.”

Is there an upside to zero hours?

Flexibility. You’re not tied to set hours, which works well for some people.

“If you’re a student or have other commitments like caring for a child or relatives, this type of work may be ideal,” says Chloe. “You have the flexibility to pick and choose when you work.”

Can I still get JSA and other benefits on a zero hour contract?

You might get some benefits. Some depend on the number of hours you work, so it’s best to keep a record of the hours you do.

  • If you work 16 or more hours a week you might get Working Tax Credit. You’ll need to tell the Tax Credits helpline about any changes.
  • If you work less than 16 hours a week you might quality for JSA.
  • You could also get income-related benefits like Housing Benefit and Council Tax Benefit.
  • You probably won’t have automatic rights to maternity, paternity or adoption leave, a notice period or statutory redundancy pay.

I’m on JSA. Do I have to take a job with a zero hour contract if I’m offered one?

Not at the moment, no. Currently, jobseekers don’t have to apply for zero hour contracts and you shouldn’t be sanctioned if you turn one down.

The government is planning to change this though, as part of the Universal Credit system.

Next Steps

  • Use the Turn2Us calculator to work out what benefits and grants you're entitled to, or call their helpline on 0808 802 2000
  • Chat about this subject on our Discussion Boards.
  • Need help but confused where to go locally? Download our StepFinder iPhone app to find local support services quickly.

By Anne Wollenberg

Updated on 29-Sep-2015

Photo by Shutterstock