What could the Employment Rights Bill mean for industries which rely upon seasonal workers?

The festive period is well and truly underway; city centres are packed with shoppers and revellers enjoying Christmas get-togethers. This influx of trade places extra pressure on many industries including retail, hospitality and courier services. Many businesses meet this demand by hiring additional seasonal staff, with household names like M&S and Tesco launching Christmas recruitment drives as early as October each year. Seasonal workers tend to be hired on fixed term or zero-hour contracts to maximise flexibility for employers and the staff themselves.

How does the Bill impact seasonal workers?

Despite snappy headlines suggesting otherwise, the Employment Rights Bill does not ban employers from issuing zero-hour contracts. Instead, the Bill plans to introduce a more discrete requirement: employers will, in certain situations, be obliged to offer guaranteed hours to workers on zero-hour and certain minimum-hour contracts.

Employers will be required to offer a number of guaranteed hours that reflects the number of hours worked by that individual during a specific reference period, which is yet to be defined by legislators. Depending on the reference period, there is a possibility that seasonal staff on zero-hour and certain low hour contracts could be entitled to be offered a contract that represents the hours they have worked up until that point. We could see employers issuing staff fixed-term contracts with guaranteed hours as opposed to zero-hour contracts. However, depending on how many hours of work are offered in the fixed-term contract, employers may still be caught by the guaranteed hours provisions despite there being no consistent demand for staff to service those hours outside of the festive period.

When will these changes take effect?

The Employment Rights Bill continues to be debated in the House of Commons and House of Lords, with the latter recognising that certain sectors rely upon seasonal workers at various points throughout the year. In acknowledgement of this, the House of Lords is currently pushing for the Regulations – which will follow once the Employment Rights Bill receives Royal Assent – to have regard to the specific characteristics and requirements of seasonal work.

In its current form, the Employment Rights Bill will require employers to give workers who are employed under zero-hour contracts or contracts which do not provide for specific shift patterns, reasonable notice of shifts. There is also provision for compensation for workers whose shifts are cancelled, moved or curtailed at short notice. These provisions are of relevance to seasonal work where demand can often change at short notice.

These provisions are unlikely to take effect before 2027, and perhaps even that is an optimistic timeframe. The initial timeline for the Bill receiving Royal Assent has shifted significantly from the Government’s original projection of summer this year. Once the Bill does finally receive Royal Assent, Regulations will be required to expand on the zero and low-hour contract provisions. There will also be a public consultation in which businesses can play a part in shaping how these provisions will play out in practice. The consultation will not go live until after the Bill has been passed.

Key takeaway

In the meantime, employers utilising zero or low hour contracts should consider auditing their workforce to identity how many workers are engaged on zero hours and minimum hours contracts, as well as reviewing internal systems for workload projection, allocating shifts and shift changes.

How we can help

If you would like to discuss how this issue might impact you or your business, please contact our employment law solicitor Kirstie.Smith@andersonstrathern.co.uk.