Compensation for cancelled shifts? Not a problem with PARiM
Perhaps one of the most significant downsides of the ever-increasing gig economy-style employment and zero-hours contracts is the fact that their shifts and projects can be cancelled very easily despite the freedom they seem to give.
To combat this, in 2019, the European Parliament passed a directive on transparent and predictable working conditions in the European Union. According to this legislation, employers must set a reasonable notice period for cancelling shifts. This can vary depending on the industry but has to be agreed upon between employers and employees before scheduling. If shifts are cancelled after the notice period, employees are entitled to compensation.
After Brexit, zero-hour workers and employers are not affected by this directive. While plans within the UK have been previously proposed, the progress has been slow. But as of July 2023, a bill on predictable terms and conditions for workers has received cross-party support in the House of Commons and is currently waiting for 3rd reading in the House of Lords. It is thus very likely that the bill will pass.
This could mean that any gig economy or zero-contract workers who have their proposed shifts cancelled at short notice could be paid fair compensation. PARiM monitors the situation and stands ready to add needed modifications when new legislation takes effect. However, we already offer an infinitely customisable set of features for Shift Cancellation, Deletion and Assignment features.
PARiM's unique cancelled shifts reporting and customisation rises to prominence as it can help you get a handle on this tricky subject already today. Here's how easy PARiM can make about your employees and sound business management practices already in 3 simple steps:
1. To start with, you can add an endless list of shift cancellation reasons that fit your business, which you can then select when removing an employee from a shift or when deleting the shift (you can also easily do that for multiple shifts when enabling our Selection Mode).
2. Secondly, if you give them the right to do so (and that depends on how your management team decides to design your business processes) workers themselves can also cancel a shift with a cancellation reason more than 24 hours before it's start time either on our free mobile apps or via our Staff Portal.
3. Finally, you can use PARiM's one-of-a-kind Shift Cancellation view to monitor cancelled shifts by cancellation reasons.
So there's already a lot you can do with PARiM to improve processes and working conditions. However, let's take a closer look at the proposed plans and how New Zealand dealt with similar issues to see what's likely to come up in the next few years.
Protecting Zero-Hour Contract and Gig Economy Workers
In 2019, 40% of workers in the United Kingdom reported having no set hours, varying from one week to the next. While there is nothing wrong with a zero-hour contract in itself, due to a lack of adequate technological solutions and processes, many suffer from anxiety about the changes as it leaves them feeling uncertain.
In fact, many prefer to have more hours on their zero-hour contract positions rather than switch to a new employer. According to the Department for Business, Energy and Industrial Strategy, around 1 in 6 workers with flexible hours only get notice of a day to inform them that their shift has been cancelled.
Greg Clark, the Government’s Business Secretary, has said that while the business models have presented people with a broader range of working opportunities and patterns, there is a need for workers’ rights to be kept up to date with the various changes that have come into play. They also need to fully reflect on the working environment in the world these days and look at dealing with the small percentage of companies out there who are not treating their staff as fairly as they should.
New Zealand Has Already Implemented a Similar Plan
This is not a new thing in the employment world, as back in April 2016, new rules were brought into effect in New Zealand regarding the cancelling of shifts and not paying workers. Unless companies and employers met specific compliances with the Employment Relations Act 2000 changes, they would not be able to cancel shifts. Their law stated that employers could only cancel shifts if there were an existing clause in the employment agreement specifying:
The reasonable period of notice they are going to give if they need to cancel shifts.
The compensation an employer is going to give their employee if they are unable to give them enough notice about a shift cancellation
That means even if a company is legally allowed to cancel a worker’s shift, they still either must give notice or pay them some compensation. This raised interesting questions about what reasonable notice and the kind of compensation workers should be given.
What is a Reasonable Period of Notice?
According to the 2000 Act, there is no specified amount of notice required to be given. However, it does state that all important factors should be considered, including:
Nature of the business, including the likes of whether an employer can foresee or control circumstances that arise and create the need for shift cancellations
Nature of the work carried out by the employee in question and the effect the shift cancellation could have on the individual
Nature of the employment arrangements of the employee, including the likes of the hours they agreed to work and the guaranteed hours including in those agreed hours.
What this means is, if an employer has more control or greater foresight over when shifts are going to be cancelled, they will need to give their employees a longer notice, as it would be unfair if you had that much control and didn’t provide fair warning to them.
It also means that more notice should also be provided where the cancellation is likely to have a greater effect on the individual. It can be difficult to work out the impact but look at it this way – if they are working in a minimum wage position and only work a small number of shifts a week, not being paid or compensated could really leave them in trouble.
However, if there is a minimum number of guaranteed hours that both the employer and employee agreed upon, giving a lot of notice may not be required as the employee will still get their guaranteed hours.
As it looks likely that the UK Parliament will pass the Workers Predictable Terms and Conditions bill, things might be much more secure for the gig economy and zero-hour contract workers in the near future. This is important as those forms of employment show no signs of going out of fashion, because of the flexibility they offer.
