There has of late been considerable public concern in the UK about the use of a kind of employment arrangement known as the ‘zero hours contract’. The essence of employment arrangements of this kind is that the worker is offered work as and when the employer or work-user wishes without the guarantee to the worker of a minimum number of hours of remunerated work in any given period of time. The public concern is that the use of this kind of work arrangement is apparently becoming more and more extensive, so that a large proportion of workers find themselves in situations of highly precarious employment. Moreover, many experts in labour law have a further concern that it is often unclear what employment rights the workers in those situations possess. Depending upon the precise nature of the arrangement in each case, the worker’s legal path of access even to such fundamental human rights at work as that of freedom of association may be in doubt.
The Government purported to respond to this concern in December 2013 by launching a Consultation, which closed in mid-March 2014 but which will presumably give rise to public and Parliamentary debate when its results have been published. However, the framing of the Consultation Document, and the terms in which it was introduced by the Business Secretary Vince Cable, suggest that the Government takes the view that the ‘zero hours contract’ is an established and fully legitimate form of work arrangement, offering valuable flexibility to employers and workers alike, and generally speaking conferring adequate employment rights upon workers; it seems to be regarded as sufficient to elicit and address possible issues about the ‘exclusivity’ of some of those contracts and the ‘transparency’ of the communication of their terms to the workers involved.
I argue that this approach to ‘the zero hours contract’ is misconceived and inappropriate in a number of different ways. It understates the problems associated with the rapid growth of the ultra-casual employment arrangements which are known as zero hours contracts. In particular it commits a particular error in its legal analysis. The point here is that if, as the Consultation document does, we define a ‘zero hours contract’ quite simply as ‘an employment contract in which the employer does not guarantee the individual any work, and the individual is not obliged to accept any work offered’, we are in fact conjuring up an oxymoron, a contradiction in terms, a non-existent beast – because we have it on the highest judicial authority that such an arrangement, by definition lacking in mutuality of obligation, certainly cannot constitute a continuing contract of employment (see Carmichael v National Power plc  UKHL 47); and it probably cannot constitute a ‘worker’s contract’ or indeed any kind of continuing contract all. In the particular sense in which the Consultation Document uses the terminology, we might say that, just as there is no such thing as a free lunch, there is no such thing as a zero hours contract.
However, putting irony aside, we should be very worried about this way of understanding the factual and legal nature of ‘zero hours contracts’. That is because, on that definition of the ‘zero hours contract’ a worker working under such an arrangement would typically lack the employment rights of ‘employees’, and probably also those of ‘workers’. I contend that, if we are to accept the notion of ‘zero hours contracts’ as an even partly legitimate institution, that should be on the footing that such arrangements both attract and deserve the character of employment contracts or workers’ contracts to which the rights of employees or at least the rights of workers attach. This involves recognising the claims to a degree of stability and reciprocity in their work arrangements which even those engaged in casual work relations ought still to possess. The achievement of that recognition would involve a full engagement with a whole host of legal and regulatory problems and issues of empirical or statistical assessment of the nature and extent of ‘zero hours’ employment and casual work more generally; the purpose of this Note is to draw attention to the urgent need for that engagement, and to the dangers of being diverted from that engagement by the bland and misleading reassurances offered by Dr Cable’s Consultation.
*A set of suggestions for the terms of that engagement will be contained in an imminently forthcoming working paper to be published as A. Adams, M.R. Freedland and J.Prassl, ‘ The “Zero Hours Contract” – Regulating Casual Work or Legitimating Precarity?’ in the University of Oxford Legal Studies Research Paper Series on SSRN.
**The following colleagues have associated themselves with the concerns expressed in this Note:- Lizzie Barmes (QMC), Alan Bogg (Oxford), Douglas Brodie (Stirling), Hugh Collins (Oxford), David Cabrelli (Edinburgh), Nicola Countouris (UCL), Anne Davies (Oxford), Simon Deakin (Cambridge), Ruth Dukes (Glasgow), Sandra Fredman (Oxford), Judy Fudge (Kent), Virginia Mantouvalou (UCL), Louise Merrett (Cambridge), Jeremias Prassl (Oxford), Astrid Sanders (LSE).
Mark – I am intrigued about this problem, which probably reflects my own lack of research. The problem is this: while the person is working, I think there must be mutuality; and there probably is at the point in time that they agree they will work a particular shift (e.g. “Yes, I’ll come in tomorrow”). This wasn’t an issue in Carmichael, as I recall, and see e.g. Stephenson v Delfi (para 13) and Cotswolds v Williams for discussion of the issue. Unless the person is free to go home at any moment in the course of a shift, I can’t see the difficulty in saying there is mutuality for that particular shift. But does this mean there are a series of individual contracts, unconnected to each other? Or what? Take the concrete problem case of holiday pay: assuming the “zero hours” worker is a worker when at work, is a holiday payment due at the end of every single shift that a worker works? Or what?