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Ban on exclusivity clauses in zero-hours contracts

View profile for Clare Gilroy-Scott
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The government has announced its intention to ban the use of exclusivity clauses in zero-hours contracts where that contract prevents the individual from working for another employer even when their main employer does not provide them with work. It is estimated that 1.4 million workers work under zero-hours contracts and, of these, 125,000 are subject to such “exclusivity” clauses.

The announcement was made as part of the government’s response to its consultation on the use of zero-hours contracts, which received over 36,000 responses (35,000 of which were from the campaign group 38 Degrees), with 83% of respondents in favour of banning exclusivity clauses.

Unions and campaign groups have stated that the ban on exclusivity clauses does not go far enough, with some calling for zero-hours contracts to be outlawed entirely. Business groups, however, have emphasised the importance of maintaining flexibility in the UK’s labour market.

The Business Secretary, Vince Cable, has announced that the government will take a series of further steps, including:

  • Consulting further on how to prevent rogue employers evading the exclusivity ban, for example by offering 1 hour fixed contracts.
  • Working with business representatives and unions to develop a code of practice on the fair use of zero hours contracts by the end of 2014.
  • Working with stakeholders to review existing guidance and improve information available to employees and employers on using zero-hours contracts.

The ban on exclusivity clauses has been included as part of the Small Business, Enterprise and Employment Bill, introduced to Parliament on 25 June 2014.

 This guide is for general information and interest only and should not be relied upon as providing specific legal advice. If you require any further information about the issues raised in this article please contact the author or call 020 7404 0606 and ask for your usual Goodman Derrick contact.