New Research: Companies Turning Away From Exclusivity Clauses In Zero Hours Contracts - DAC Beachcroft

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New Research: Companies Turning Away From Exclusivity Clauses In Zero Hours Contracts

Published On: 4 April 2014

Employers appear only to use exclusivity clauses in limited situations, according to brand new research conducted by international law firm DAC Beachcroft.

The results underline that, although protecting employees from abuse through use of zero hours contracts is essential, flexibility for both employers and employees remains a key consideration.

The survey also highlighted that fewer than one in 12 respondents use any exclusivity clauses at all within their zero hours contracts while more than three quarters claim to be aware of zero hours staff who work for other employers.

Over half of respondents recommended the government bans exclusivity clauses (which prohibit employees from working for anyone else), while more than a third of UK employers think they cannot be justified under any circumstances. However, some point to specific, limited projects undertaken by senior employees or directors, particularly where there is a need to protect commercial confidentiality or trade secrets, as occasions where such clauses may still be necessary.

In addition, three quarters of employers polled urged the government to provide more overall guidance on the use of exclusivity clauses.

The new survey by DAC Beachcroft canvassed clients drawn from several industry sectors for their views on the government's consultation on zero hours employment contracts, which closed in March. Zero hours contracts provide useful flexibility for employers with many using them to cover times of peak demand, holidays and sickness absences. It was clear from the research that such contracts are also often used to recruit specialists where there is a genuine ad hoc requirement for specialist skills or knowledge. However, the issue has been at the heart of a long-running political debate concerning the extent of their use and possible abuse by UK employers.

Banning zero hours contracts was not an option addressed by the consultation, despite calls for such a ban from some trade unions. Instead, the proposals ranged from potentially doing nothing to banning exclusivity clauses entirely while statutory codes of practice, guidance, model clauses and better provision of information were also suggested.

Commenting on the survey results, DAC Beachcroft Employment Partner, Sue Jenkins, said: "Given that all political parties appear committed to taking some action over zero hours contracts, it seems we should expect some change in the future. In the meantime, the results of our survey underline that employers should review the transparency of their zero hours arrangements and look at any exclusivity clauses in use to consider whether they are justified in the circumstances."

She added: "Employers should also ensure zero hours workers' employment status and rights are fully understood by all - applicants and internally - and make sure there is clarity around the terms and consequences of the contracts."