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Zero hours contracts back under the spotlight

Employment Law & HR
BG Purple

The Office of National Statistics (ONS) has released the findings of a recent survey it carried out into the use of Zero Hours Contracts. Your initial reaction might be that the results are startling: they have found that nearly 700,000 people are on zero-hours contracts in their main job - a rise of over 100,000 on a year ago.

However, the ONS has said the 28% increase was not so much the result of a surge in the number of zero-hours jobs offered by employers last year, but more due to increasing recognition of the contracts by staff when asked by researchers about their employment terms. They also said that consecutive surveys of total contracts were difficult to compare because they were carried out at different times of the year and prone to seasonal changes in employment practices.

Regardless of whether the apparent rise in the use of zero hours contracts is genuine or not, the survey’s findings are likely to trigger renewed debate over the widespread use of these contracts that guarantee no minimum hours and tend only to offer those benefits guaranteed by law, such as holiday pay.

The Labour party and many trade unions have accused the government of allowing a low-pay culture to grow unchecked, forcing many workers to live a hand-to-mouth existence that often prevents them from qualifying for a mortgage.  Nonetheless some of Britain’s largest employers offer zero-hours contracts to employees;  JD Wetherspoon, Burger King, Domino’s Pizza, Sports Direct and McDonald’s to name but a few. 

The ONS survey found that over half of businesses in the hotel and catering sectors used the contracts and a quarter of businesses in education made some use of no-guaranteed-hours contracts in 2014. Universities and colleges have become large-scale users of zero-hours contracts, while an estimated 160,000 care staff are also on similar deals. It also found that people on zero-hours deals are more likely to be women, students in full-time education or working part-time. They are also more likely to be aged under 25, or 65 and over.

Vince Cable has said some criticism of employers was valid, especially those that put exclusivity clauses in the contracts which prevent workers from holding more than one job. He is piloting a ban on exclusivity clauses through parliament at the moment.  But the Business Secretary has also said the contracts “are valued by many employers and individuals who want flexibility in the hours they work”, naming students, people with caring responsibilities, and those who want to partially retire as beneficiaries.

It is expected that Labour’s general election manifesto will pledge to change the law so that workers with regular shifts have the legal right to a regular contract.

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