What you need to know
Agreed hours of work
If an employee’s hours of work are agreed, the parties’ employment agreement must state what has been agreed. This includes agreement on the number of hours, the employee’s start and finish times, the days of the week the employee will work and any flexibility in what has been agreed.
The employer and the employee do not have to agree on hours of work, but anything that is agreed needs to be recorded in the agreement.
Prohibition of “zero-hour” contracts
An employment agreement will be “zero-hours” if it requires an employee to be available for work, and accept any shifts they are given, with no requirement that the employer in fact provide any shifts.
These are prohibited except where the employer has genuine reasons based on reasonable grounds for such a provision, the employee is “reasonably compensated” for making themselves available and the employee has some guaranteed hours.
What is considered “genuine reasons based on reasonable grounds” depends on:
- whether it is practical for the employer to run the business without the availability clause;
- the number of hours the employee is required to be available; and
- the number of guaranteed hours.
What is considered “reasonable compensation” depends on:
- the number of hours the employee is required to be available;
- the number of hours the employee is required to be available compared to guaranteed hours;
- the nature of the restrictions on the employee (e.g. if they have to remain within a certain area or if they cannot drink alcohol); and
- the remuneration for availability.
If there is no genuine reason for a “zero hours” provision in an employment agreement, the employee can refuse to work and not face any consequences.