What is a zero-hours contract in the hospitality industry?
A zero-hours contract is a specific type of employment agreement commonly found in the hospitality industry. This type of contract offers significant flexibility, allowing business owners to quickly adapt to fluctuations in demand for staff. But what exactly does a zero-hours contract entail? And what rules and limitations apply to this type of contract? In this article, we will answer these questions in detail and explore the various aspects of zero-hours contracts.
Zero-hours contract in the hospitality industry
In the hospitality sector, where staff demand can vary greatly, zero-hours contracts are a widely used method. These contracts allow employers to call on employees when work is available without guaranteeing a minimum number of hours. This means employees are generally only paid for the hours they actually work, which comes with both advantages and disadvantages.
Under a zero-hours contract, the employer and employee agree that no predetermined number of hours will be scheduled. This means the employee must be available to work when called upon, provided the employer gives at least 24 hours' notice. However, the employer is not obligated to guarantee work. This can result in an uncertain work structure for the employee, who may not always know when they can rely on an income. It’s important to understand that this type of contract is particularly attractive for employers who require flexibility in staffing.
Legal rules for zero-hours contracts in the hospitality industry
First, an on-call worker can invoke the legal presumption that their working hours are equal to the average number of hours worked over the preceding three months. For example, if an employee worked an average of 18 hours per week in June, July, and August, they can claim that these 18 hours per week have become their fixed working hours. As this is a legal presumption, the employer can counter it by demonstrating, for instance, that the summer months are significantly busier and that the employee’s working hours do not consistently amount to 18 hours per week.
Secondly, since January 1, 2020, the Balanced Labour Market Act (WAB) has been in force. This law introduced important changes to how zero-hours contracts are treated and provides more protection for employees. Key points of this law include:
Offer After 12 Months: Employers are required to offer zero-hours contract workers a fixed number of hours after 12 months (the 'fixed-hours rule'). This offer must be based on the average number of hours worked over the previous 12 months. This gives employees more certainty about their working hours and income after a year.
Demand for Fixed Hours: Employees have the right to request fixed hours if they have consistently worked more hours than specified in the contract. This allows employees to stabilize their working hours and prevents ongoing uncertainty about their schedules.
Collective Bargaining Agreements (CBA): Since August 1, 2022, the Transparent and Predictable Working Conditions Act requires employers to specify when employees may be called to work, such as weekends or evenings, for on-call workers.
Potential Legislative Changes
The proposed law "More Security for Flexible Workers" aims to improve the legal position of flexible workers by introducing different (new) variations of on-call agreements—such as article 7:628a BW (students/trainees), article 7:628aa (annual hours contracts and sanctions on zero-hours), article 7:628ab (basic min-max contracts), and article 7:628ac BW (other categories). It is currently unclear whether this proposal will be implemented.
Discussions are also underway about a potential ban on zero-hours contracts in certain sectors. Critics argue that these contracts can create financial and scheduling uncertainty for workers, as their work hours are often unpredictable. This could lead to employers being required to offer more security to their workers, helping them better plan their finances and schedules.
Conclusion
A zero-hours contract can have both advantages and disadvantages, depending on the perspective of the parties involved. For employers, it offers flexibility and cost savings, as they only pay for hours actually worked. This can help businesses run more efficiently, especially in sectors like hospitality, where staff demand fluctuates significantly. On the other hand, employees may appreciate the flexibility in working hours but could experience income uncertainty, leading to stress and financial difficulties, particularly if they rely on a steady income.
It is important to be well-informed about the rules and potential changes surrounding zero-hours contracts. Whether you are a business owner or employee in the hospitality industry, seeking legal advice and thoroughly reviewing CBA agreements can help you clearly understand your rights and obligations under a zero-hours contract and ensure that both employers and employees are prepared for possible changes in the law.
This article was checked by:
Advocaat Arbeidsrecht (Counsel) / Employment Lawyer - CLINT | Littler