Wetherspoon boss defends zero-hours after profits leap to £77m

The chairman of the pubs group Wetherspoon, Tim Martin, defended the group’s use of controversial zero-hours contracts yesterday, claiming that increased regulation would put up the price of a pint.

The employment practice, where employees are only paid for hours worked, has been in the spotlight after Labour pledged a crackdown on the contracts. Wetherspoon has around 24,000 staff employed on these terms across its pubs.

Mr Martin said: “[Zero-hours contracts] have been less of an issue in pubs than in the political sphere. It started off with people on flexible contracts who were not getting holiday pay, sick pay, maternity pay, but at Wetherspoons they receive all of those things and they are eligible for free shares and bonuses.

“In a trade like pubs it would probably push up the price of a pint if there was regulation… A third of the price of a pint is in wages now compared with 5 per cent in a supermarket. Most people will get the hours they want in reality.”

Wetherspoon is paying out £28.6m in free shares and bonuses after record results. Of this around 83 per cent, or £23.7m, is paid to pub staff, with pub managers taking just over half and the remainder split between the zero-hours staff.

Despite a beer duty cut in March’s Budget, Mr Martin’s tax bill rose by more than £32m in the year to 28 July and he is cranking up his campaign for VAT parity with supermarkets.

Mr Martin is supporting campaigner Jacques Borel’s VAT Club on Tax Parity Day although the Government estimates cutting VAT to 5 per cent for the hospitality sector could cost the Treasury more than £11bn.

The group posted forecast-beating pre-tax profits of £76.9m with sales at pubs open more than a year up 3.6 per cent in the six weeks to 8 September. The shares, up nearly 40 per cent since the start of the year, ended up 17p at 752p.

James Hollins, an analyst at Investec, said: “Wetherspoon remains the stand-out quality pub operator in the sector.”