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We’ve written about zero-hours contracts many times in the past. However, this week we have seen a landmark change in the way that these contracts are managed under employment law.

The change to zero-hours contracts, in case you aren’t aware, is to the so-called ‘exclusivity’ clauses. This clause, if you haven’t yet come across it, stipulates that an employee can only work for one employer. But as of yesterday (26th May), exclusivity clauses are now banned in zero-hours contracts.

If you are a small employer, this change to zero-hours contracts may have a considerable effect on you. As, in essence, employees can now choose to work for as many employers as they like if they don’t feel they are working enough hours.

The change here to exclusivity clauses could leave you with a difficult issue. Do you allow the employee to work another job (although really, you have little say in the matter now), or do you give them more regular guaranteed hours?  Effectively tying you, and them, into a (potentially) part-time style contract.

If you cannot increase the hours reasonably, employees could even end up working more hours for a business that you would not want them working for. Where the law stands on this depends entirely on whether you have included a ‘non-compete’ clause in your contracts, and a confidentiality clause too.

There are also further considerations from a safe working practice perspective. Monitoring how many hours someone is working, particularly in care industry, is crucial to understand whether they are getting enough rest in accordance with the Working Time Directive. An employer can only do this if the employee is honest with them about their hours for other employers too.

If you have used zero-hours contracts responsibly these issues should not really affect you as an employer. As Neil Carberry of the CBI states, “banning exclusivity clauses in zero-hours contracts is a proportionate response to tackling examples of poor practice”. The important part there being ‘poor practice’.

Interestingly though, Carberry went on to say that “any further regulation must not damage our flexible labour market”. Suggesting that this week’s change, although a good thing, is potentially a step on the road towards a complete overhaul of flexible contracts like these altogether.

As with any change in employment law, we will not see the real effects for months. However, the ban on exclusivity means that if you’re an employer, you will want to evaluate your current contracts thoroughly. First to ensure that you are complying with the new regulations, and also to check that you have all the necessary protection to avoid employees working in part for a competitor.

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