It said that use of the clauses undermined flexibility and choice for the 125,000 workers it estimates are subject to them.
Vince Cable, the business secretary, said: “Zero hours contracts have a place in today’s labour market. They offer valuable flexible working opportunities for students, older people and other people looking to top up their income and find work that suits their personal circumstances.
“But it has become clear that some unscrupulous employers abuse the flexibility that these contracts offer to the detriment of their workers. Today we are legislating to clamp down on abuses to ensure people get a fair deal.”
Some business leaders had been concerned that the Government would go further but expressed relief today that the new measures are proportionate and will not reduce flexibility.
Simon Walker, head of the Institute of Directors the debate around zero-hours contracts has at times been “hysterical” but that the Government should be congratulated for being proportionate.
He said: “The whole point about the flexibility offered by Zero Hours Contracts is that they allow an individual to capitalise on their own time, labour and energy.
“We’re pleased that the government recognises the enormous value that flexible contracts can bring to both employer and employee, but at the same time it’s right to ensure that exploitation is stamped out.”
Tim Thomas, head of employment policy at EEF, the manufacturers’ organisation, said: “For manufacturers where skills are in scarce supply, zero hours contracts can help employers to tap into specialist skills when they are needed, such as drawing on the experience of older workers.
“The way forward set out in the Small Business, Enterprise and Employment Bill treads a fine line between supporting the majority of workers who want to continue to work on their zero hours contracts and limiting their use where they are neither necessary nor appropriate.”
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