Employers are no longer able to stop lower paid workers from taking a second job with another employer by using so-called ‘exclusivity’ clause
Previously, the ban on exclusivity clauses only applied for workers on zero-hours contracts – where their employer was not obliged to provide them with minimum working hours and they were not obliged to take work offered to them.
From 5 December 2022, the ban also applies to workers whose guaranteed weekly income is on or below £123 – the Lower Earnings Limit.
An ‘exclusivity’ clause is any contract term either stopping a worker completely from doing work or performing services under another contract (or arrangement) or stopping them from doing so without their employer’s permission.
Employers are therefore no longer able to stop their lowest paid workers from taking second jobs to help them make ends meet. If they dismiss them for breaching an exclusivity clause this will automatically be an unfair dismissal, irrespective of the worker’s length of service, and subjecting the worker to a detriment will also be unlawful. The changes are forecast to create an extra 1.5m workers now able to take second (or more) jobs.
However, as the limit of £123 per week equates to around 13 hours per week (assuming those affected are on the living/minimum wage), it remains to be seen how many workers will benefit.
Employers should review their contracts of employment to remove exclusivity clauses; risk assess whether existing lower paid staff may apply for second jobs; and consider whether the new rules are an opportunity to recruit more easily.