Zero-Hour Contracts: Pros and Cons

At the start of the year, newspapers were already warning of the impending spread of zero-hour contracts, referred to by the Daily Mirror as a ‘cancer’ that would spread to 1.5 million workers this year. Zero-hour contracts basically offer work as and when an employer wishes; prospective employees are under no obligation to accept this offer, but if they don’t, the employer may decide not to offer them further work. For some, the lack of security of zero-hour contracts make them a last resource; for others, however, zero-hour contracts are a handy way to earn an additional income or make ends meet between jobs. In this post we discuss a few pros and cons of this type of working arrangement:

 The Upside of a Zero Hour Contract:    

  • Flexibility: You can always turn down a shift if you are offered zero hour work, yet the downside of this is that your employers can decide to work with someone else in the future so you might feel obliged to accept.
  • Free Time: In theory, a zero hour contract does not offer full-time hours, so it can work well for students or those trying to make a little extra money while taking time off. In reality, however, they can involve around 50 or 60 hours, so it may be worth waiting until you find standard full-time work.
  • Freedom to apply for another job: In the past, under a zero contract arrangement, an employer could demand exclusivity from a worker. Thankfully, this is no longer the case, so you can use the free time between jobs to find more suitable employment.
  • Industry experience: Sometimes, companies offer zero-contract jobs because of budgetary restrictions. However, this type of contract can be seen as an opportunity to show your employer your ability and drive, so that when a full-time position becomes available, you could be considered for it. Zero contract work also provides you with the experience you may have been lacking in the industry you would eventually like to work in.

The Downside of a Zero Hour Contract:

  • Lack of Stability: This type of contract does not offer set hours of work, so the amount you take home will vary from week to week. If you find yourself in this situation, see the Gov.uk website to find out if you are entitled to any benefits.
  • Lack of Benefits: A zero hour contract lacks many of the benefits of a permanent or fixed contract, including a pension and redundancy rights, as well as sick or holiday pay. This can be frustrating, especially if you are putting the same hours and effort into the job as fixed or permanent workers. Under a zero hour contract, you can be fired with very little notice and you will have very limited rights to claim unfair dismissal.
  • Always On Call: If you have children or other obligations, not knowing when you will be needed at work can make you feel very insecure. If you enjoy a good relationship with your employer, inform them of your schedule beforehand, so they can offer you work during your free hours.
  • Struggling to make payments: Since you may not be called in to work for one or various weeks, you may be unable to meet regular monthly payments such as a mortgage, groceries, electricity, etc. Moreover, you may be rejected when you ask for credit or for a large loan such as a mortgage, owing to your lack of financial stability.  Additionally, under a zero hour contract, the hourly pay can be very low – sometimes little more than the minimum wage.

The final verdict:

If you are seeking to gain more experience in a particular industry, or gain a little extra money while studying or during a sabbatical, a zero hour contract can be a good temporary solution. However, if you are looking for something more permanent and reliable, or if you wish to buy a home or obtain credit for a car, renovations etc., you are better off looking for a permanent or fixed contract. Use the zero hour contract to your best advantage, without falling prey to permanent instability. Sometimes, this type of arrangement can be just what you need during a specific moment in your life.

This article is contributed by Juliette Bowker.