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Exclusivity clauses in zero-hours contracts finally banned

Some two months after claiming that they had been banned, the government has finally acted to outlaw the use of exclusivity clauses in zero-hours contracts from 26 May 2015. This and other employment law-related measures are contained in the first commencement order made under the Small Business, Enterprise and Employment Act 2015.

The provisions of the Act, as they affect employment law, coming into force on 26 May are:

Section 153 – this section bans the use of exclusivity clauses in zero-hours contracts. Further regulations are awaited dealing with the anti-avoidance aspects.

Section 152 – this increases the penalty which can be imposed on an employer that underpays its workers in breach of the National Minimum Wage law. The maximum penalty of £20,000 can now be calculated on a per worker basis rather than on a per employer notice basis.

Section 149 – this section enables regulations to be made to prevent discrimination against applicants for NHS roles on the grounds they have made protected disclosures (blown the whistle). No regulations have yet been made and consultation on this is expected.

Section 33 (certain parts) and 34 – these enable the Secretary of State to make regulations about the meaning of a ‘small business’ (currently a headcount of fewer than 50 and a specified threshold for turnover and balance sheet) and a ‘micro business’ (currently a headcount of fewer than 10 and a specified threshold for turnover and balance sheet).

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