Zero Hours and Casual Contracts of Employment
The difference between zero hours and casual contracts of employment is one
of the most confusing issues facing employers.
The terms ‘zero hours’ and ‘casual’ contracts of employment are often used
interchangeably by employers and, indeed, there is a lot of overlap between
the two. To complicate matters further, there is no legal definition of
what constitutes a zero hours contract, aside from the unenforceability of
exclusivity terms (preventing individuals engaged under a zero hours or
casual contract from working for another organisation), which apply with
both types of contract. Essentially, then, zero hours and casual contracts
are agreements between two parties where one party may be asked to perform
work for another but there are no minimum contracted hours: an ‘as and
when’ contract. These contracts are particularly common with seasonal work
or where the requirement for workers is unpredictable.
The contract will state what pay the individual will receive if they carry
out work and whether or not he or she can turn down work if it is offered.
This latter point is crucial because if the contract states that there is
no obligation on the employer to offer work to the individual and no
obligation on the individual to accept work that is offered, this should
mean that one of the key factors in creating an employment relationship -
mutuality of obligation - does not apply.
In the Simply-Docs suite of employment contracts, a Casual Work Contract is
defined as one where the employer has no obligation to offer work to an
individual and the individual is not required to accept the work when it is
offered. For situations where the employer is under no obligation to offer
an employee work but, when it does, the employee is required to accept the
offer, the Zero Hours Contract should be used instead.
It is very important that employers use the correct contract to suit their
particular circumstances and employers, as a matter of good practice,
should regularly review the contracts used in such ‘as and when’
arrangements to ensure that the contracts continue to reflect the reality
of the working relationship. Finally, it should be noted that, whatever the
contract might say, a casual worker who has worked for the same employer
for 12 consecutive weeks will automatically have identical rights to those
of a permanent employee.