If you engage staff on zero hours contracts who are genuinely casual workers (see article here to check), then you must remember that they still have some employment rights. Casual staff are defined as workers, not employees or self-employed individuals, and workers do have some limited employment rights, so don’t get caught out by thinking if they are not employed you don’t have to worry.
So what rights do casual workers have?
Casual workers accrue holiday every time they work for you at the same statutory minimum rate as employees. Because casual workers usually don’t have guaranteed hours, the best way to work this out is based on 12.07% of however many hours they’ve worked. You must either allow them to physically take holiday, or pay them in lieu of holiday accrued at the end of a period of work. You can’t just increase their hourly rate and say it’s holiday pay…
Casual workers must be paid the appropriate National Minimum Wage rate for their age.
Tax and NI contributions
You must pay tax and National Insurance contributions for casual workers where their earnings warrant this, in the same way as for employees. This differs from self-employed individuals who are responsible for their own tax.
If a casual worker meets the requirements for Class 1 National Insurance contributions, they would qualify for statutory sick pay.
Casual workers are protected against discrimination under the Equality Act if they are treated less favourably because of a protected characteristic.
Deductions from earnings
Casual workers have the same protection against unlawful deductions from earnings as your employed staff.
Working time regulations
Casual workers are still protected by the Working Time Directive in terms of maximum hours worked and entitlement to rest breaks.
Health and safety protection
Your obligations and liability for health and safety in respect of casual workers is the same as for employed staff.
Casual workers are protected in the same way as employees if they want to make a qualifying disclosure under Whistleblowing legislation.
The fact that casual workers have a fair number of rights is a clear indicator of the importance of having a proper casual worker agreement in place, which formalises the relationship, and is an opportunity for you to set out the terms you wish to operate (within legal parameters) in respect of issues like hours, notice of sickness absence, conduct and behaviour expectations, as well as any confidentiality or other specific requirements you might need to include.
If you’d like some help with casual worker rights in your business, do get in touch.