Feast or Famine – How to staff a changing workload

Labour’s manifesto plans include excision of zero hours contracts. If they succeed, many businesses are likely to revert to using freelancers who provide services on a self employed basis. Currently, zero hours contracts proliferate because they control the employee but offer little in return. Hours, and therefore salary, are only provided if it suits the employer to do so. The joy of zero hours contracts is the employer is not troubled by the question of whether individuals working on a casual basis are employees. On a zero hours contract, they most certainly are but it gives them very little. Certainly any claim they may have for poor treatment is virtually valueless in most cases because they cannot establish loss when both sides understood that nothing was ever guaranteed in the first place. For that reason employees on zero hours contracts are appealing to a business. The problem for businesses that use freelancers is the uncertainty as to their true position. Perhaps they can claim to be employees by arguing that the work that they have done has established set hours and set entitlements. If such an argument succeeds they can be viewed as employees in a much stronger position than the beleaguered zero hours employee. Freelancers all too often aren’t on a contract. That is even the case when they are referred to as contractors. Their client group tends to be fast moving industries and they  increasingly provide their services remotely. Web companies are one of the biggest users of freelance workers and if zero hours contracts are outlawed that reliance is sure to increase. If the relationship is to be properly evidenced then the freelancer should provide a contract, should work for other clients and should invoice the companies that they work into. Larger companies have a set contract for freelance workers but they would do well to consider requesting that such individuals provide their own contracts. That evidences a lack of control over the individual in theory, suggesting that they are not an employee, and in practice allows negotiations that apply specifically to the piece of work that is the subject of the contract. Do not be fooled into thinking that someone typing from home with their cat on their lap is not an employee. If there is no contract expressly stating that both sides agree that said cat owner is not employed, then there may be a very good argument that an employment contract is in fact in place. That position is exacerbated when the business exercises control over the worker’s output. For example a general guide as to house style with a clear understanding, evidenced in writing, that the house style is for all guesting writers is one thing. A requirement that a writer should improve in the next two articles and will be reviewed to see if they have done so is quite another. The first may be general guidance for contractors, the second may well evidence enough control to suggest that the individual is in fact an employee with all the protections that provides. The overwhelming lesson here for businesses intending to maintain a flexible workforce is that the relationship should be clear. Remote working does not prove much. Individuals declaring their own tax does not prove much more. Get the relationship clearly on a contractual basis. Businesses should have the flexibility to operate in a difficult market. The Courts are much more inclined to that view if both sides of the relationship are clear as to what the agreement is between them. A small effort at the start is repaid in spades at the end.