Zero-hours workers are on “poverty pay”, earning nearly £300 a week less on average than permanent employees, according to research from the Trades Union Congress (TUC).
It has warned of a “two-tier workforce” with average weekly earnings for zero-hours workers of £188, compared with £479 for permanent workers.
The TUC studied data from the Office for National Statistics’ Labour Force Survey, the only official source on pay for permanent and temporary workers, as well as those on zero-hours contracts.
The controversial employment contracts are used by major companies including billionaire Mike Ashley’s Sports Direct.
Labour has pledged to give workers a regular contract if they are working regular hours as well as the right to refuse demands to be available outside contracted hours. Employers would have to pay compensation when cancelling shifts at short notice.
Unemployment has fallen rapidly this year below the 2 million mark in the latest figures, with 589,000 more workers in jobs than a year earlier in the quarter to September, but latest official estimates – for the April to June quarter – showed 622,000 on zero hours contracts.
Frances O’Grady, the TUC general secretary, said: “The growth of zero-hours contracts, along with other forms of precarious employment, is one of the main reasons why working people have seen their living standards worsen significantly in recent years. It is shocking that so many workers employed on these kind of contracts are on poverty pay and miss out on things that most of us take for granted like sick pay.”
Just a quarter of zero-hours workers work a full-time week.
Ms O’Grady added: “The increase in casual labour also helps explain why income tax revenues are falling, which is not only bad for our public finances but for society too. The lack of regular hours and income makes it difficult for households to pay bills and take on financial commitments such as rents and mortgages.”