The media is rife with articles on zero-hour contracts currently.  Politicians are wading in on the subject.

Apparently nine Parliamentary Service staff are employed on zero-hour contracts where the employees have no guaranteed hours of work (www.radionz.co.nz 6 May 2015).  I use the word ‘apparently’ because there appears to be confusion over what constitutes a zero-hour contract.  An employment contract is not a zero-hour contract simply because it does not guarantee an employee any hours of work.

Types of employment contracts

There are four common types of employment contracts: permanent, fixed-term, part time and casual.

A casual employment contract is one in which an employer utilizes an employee’s services on an ad-hoc basis.  Casual employees work ‘as and when required’. The employer and employee agree on when the employee will be available to work and the employer will notify them if work is available during the employee period of availability.  The employee is free to turn down the work if it does not suit them. The hallmark of casual employment is no obligation of on-going work and flexibility for both the employer and employee. 

In a casual employment contract there are no guaranteed work hours.  This is entirely legitimate and often suits parents, students and those semi-retired who require flexible work arrangements.

The fact that there are no minimum hours of work does not make it a zero-hour contract.

Zero-hour contracts

Zero hour contracts are more nefarious.  They provide a large advantage to employers while severely disadvantaging employees.  While there is no strict legal definition of zero-hour contracts they have attributes that make them easily identifiable.

Typical attributes include terms where an employee must be available to work for the employer but the employer does not guarantee work for the employee and they cannot work for another employer if their employer doesn’t require them.  In reality it is a permanent job with its inherent obligation and expectation of on-going work but with no guaranteed hours.

Media adding to the confusion

A recent news article on the 3 News website typifies the confusion that surrounds zero-hour contracts ( www.3news.co.nz 24 February 2015):

“… there is an entire industry in New Zealand paying minimum wage and less, because the workers they employ don’t even work a full week. It’s called a zero-hour contract, and as an employee, you are called upon to work whenever required. That means if you’re not required, you don’t get paid that week – so how do these people survive?”

Is the cited situation a zero-hour contract or a casual employment?  Obviously we need more information to know.