Tabytha Cunningham explores the options and key considerations for companies employing temporary workers
Fixed-term contracts
Fixed-term contracts are contracts of employment to cover a fixed period or task; for example, the summer period only. These can be useful to meet seasonal demand, providing certainty and helping to manage expectations on both sides with a clear end date.
Top tips:
Remember that fixed-term employees are legally entitled to receive the same contractual benefits and facilities as permanent staff.
Include notice provisions in fixed-term contracts in case the employment needs to be terminated early (because of poor performance, for example).
Agency workers
Using an employment agency to recruit and supply seasonal workers can significantly reduce the administrative burden of finding and contracting appropriate staff. However, as well as considering the agency costs, employers should be mindful that agency workers are legally entitled to access the same collective facilities and job vacancies as permanent employees from day one, and the same basic working and employment conditions (including pay) after 12 weeks.
Top tip:
Speak with the employment agency about how they monitor compliance and propose to manage the additional obligations that apply after 12 weeks.
Zero-hours contracts
Zero-hours contracts are exactly as the name suggests – there is no obligation on the company to offer, or the individual to accept, any work. These contracts can offer great flexibility to both sides and allow employers to deal with fluctuating demand week to week.
Zero-hours contracts have been criticised by the media and MPs for allowing organisations to get around employment legislation. Employers should be wary of arguments that individuals on zero-hours contracts may be entitled to employment rights as set out below.
Top tip:
Zero-hours contracts should be carefully worded to minimise the risk that the individuals are seen as employees and ensure they are compliant.
Existing workforce
For some employers, the extra labour required may simply be covered by the existing workforce through increasing overtime and offering weekend and evening shifts. Employers may wish to offer increased overtime rates to incentivise current employees to help out with the demand.
Top tips:
Include overtime clauses in employees contracts where required.
Remember your obligations relating to working time, particularly in relation to rest periods and the 48-hour limit on working time per week.
Other issues
Whatever arrangements are put in place, employers should also consider:
Employment status: most seasonal workers will be classed as ‘workers’ rather than ‘employees’ and therefore have more limited rights. For example, although workers are entitled to the national minimum wage and holiday pay, they are not protected from being unfairly dismissed. Employers should watch out, however, for regular patterns and factors that may point towards employment.
Pension rights: seasonal workers may be entitled to be automatically enrolled in a qualifying pension scheme, provided they meet the applicable criteria. Employers should therefore seek pension advice before taking on seasonal workers.
Holiday pay: when engaging seasonal workers, there may be a temptation to roll up holiday pay by including it in their hourly rate. However, this practice is now unlawful. Individuals should instead be able to take holiday when requested, or receive a payment in lieu of the untaken annual leave when their engagement comes to an end.
Tabytha Cunningham is associate solicitor at Coffin Mew