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Supermarket
  • Published:
    14 March
  • Area of Law:
    Employment

Will Asda’s new flexible contract pave the way for the rest of the sector?

Our head of employment, Michael Hibbs, gives his views on Asda’s new flexible contract and tells us what it could mean for businesses and the retail industry.
  
Adopting a flexible approach to contracts, such as zero-hour contracts, has previously come with the stigma of being unfair on the employee, but Asda’s approach could be the new model for the sector. 

However, it is likely that this type of flexible contract will not suit everyone and the voluntary nature of the arrangement at this stage will give employees the option. Although, whether Asda will put some gentle pressure on employees is of course not clear at this stage. 

Some workers will be attracted to the terms stipulated by Asda, especially those without young families or who like the night shift. In terms of feasibility, many would regard 10pm to midnight as ‘unsociable’ and whether any employees will work a night shift for just an extra £2.54 an hour will be crucial to the uptake of this.   

The real risk comes from managing cover during peak times and this will be a particular issue for smaller businesses where the labour pool may be slighter. Part of the problem for a supermarket is that they are not busy for large periods of the day/week but do have peak times when their customers get impatient if they are not served promptly or the shelves are not fully stocked. They do not want to pay for staff to be idle.

Bank holidays have always been a bone of contention for workers, however, providing shifts on such days and additional pay is not legally required unless an employment contract says so. The requirement is for 28 days paid annual leave for a full-time employee which can include bank holidays if the employer chooses to do so. As Asda have proposed in their new contract, losing a day of annual leave if they don’t work a bank holiday is only to be expected.

This is not a solution to negative press about zero-hours contracts except on a superficial basis. The employer does not get complete flexibility as they do on zero-hours but by disrupting employers normal social hours, they may make matters worse for a few.

"This is exactly why we like to work with people who understand the industry and can identify potential issues and create solutions."

Jon Saltinstall, Senior HealthCare Banking Consultant, Lloyds Bank