Extension of the ban on exclusivity clauses to low-income workers

It has been a long time coming, but in May 2022 the government announced its decision to extend the ban on exclusivity clauses to low-income workers which is estimated to impact around 1.5 million people.

The effect of this decision will mean that workers with a guaranteed weekly income on or below the Lower Earnings Limit of £123 per week will be permitted to work for multiple employers if they choose to do so. For some, at times when the economy is struggling, this will be a change that is welcome by allowing flexibility to work for multiple employers.

A ban on exclusivity clauses has already existed since 2015 for workers on zero hours contracts and the government’s decision will extend this ban to lower earners. Secondary legislation is expected to be put before Parliament later this year and follows a consultation which commenced in December 2020.  

This decision has been praised for providing workers with greater flexibility over when and where they choose to work as well as providing the opportunity to boost their income. It has been recognised that permitting workers to work for multiple employers will benefit vulnerable workers such as those whose working hours were reduced as a result of the COVID-19 pandemic, by allowing these individuals to increase their income and enhance their job security. Individuals will also have the option to engage in multiple short hours contracts. From the employer’s perspective, the government has noted how these reforms will benefit employers by increasing the number of possible applicants for positions which will help with filling vacancies in certain sectors such as retail and hospitality. Employers will need to be mindful however of the need to ensure that workers are not exceeding the acceptable number of hours per week in accordance with the Working Time Regulations 1998 and to keep an eye on this from a health and safety and wellbeing perspective.

It remains to be seen the number of workers with exclusivity clauses in their contracts who will choose to take up the opportunity to work for another employer. When the ban was introduced for workers on zero hours contracts, the number of people who took up a second job increased. 

There aren’t any indications that the ban on exclusivity clauses will be extended any further, however this will be something to keen an eye on in the future.

For more information on this article, please contact Hayley Marles.

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