Keeping Above the Law this Summer

Here, Associate Solicitor at Coffin Mew, Tabytha Cunningham, explains the ways in which employers can ensure they stay on the right side of the law with seasonal employees

For employers in the leisure, hospitality and tourism sectors, the approach of summer brings with it the need for a temporary increase in the workforce to cope with the busy period. Meeting seasonal demand is both a practical challenge and a risk area for employers. Options for employers dealing with seasonal demand and our top tips are set out below.

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 the 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 (for example, due to poor performance).

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 to the same basic working and employment conditions (including pay) after twelve weeks.

Top tip:

• Speak with the employment agency about how they monitor compliance and propose to manage the additional obligations which apply after twelve weeks

Zero hours contracts

Zero hour 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 increasingly criticised by the media and MPs for allegedly 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 to consider…

Whatever arrangements are put in place, employers should also generally 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 engaging 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.