Hyper-flexible employment contracts should be reformed, not banned

Too often zero-hour contracts are a license for exploitation

Share

Five years ago there were only around 100,000 people employed on “zero-hours” contracts offering them no guarantee of work. The number has risen steadily since. Last week, the Office for National Statistics upped its estimate by a quarter to 250,000. Now, a professional body puts the figure nearer to one million – more than 3 per cent of the labour market. Nor are such tactics restricted to sectors with sharply fluctuating demand, such as hospitality; the NHS, Amazon, and even Buckingham Palace also use them.

On paper, there is much to be said for zero-hours contracts. Employers benefit from arrangements under which they have a workforce on tap but must pay only when it is active; and some employees appreciate the flexibility, too. More important still, in times of economic uncertainty, when companies might otherwise not be hiring, it is better to have unpredictable hours than no job at all. For small businesses, in particular, such adaptability can be crucial, and their expansion, in turn, commonly drives much-needed growth.

The problem is that too often zero-hours deals are a licence for exploitation. Complaints include employees being required to be permanently available, despite there being no certainty of work; and staff not receiving standard benefits such as sick pay or pension contributions. There is also an unhealthy concentration of power in the hands of individual managers, who may allocate hours or withdraw them according to personal preference. Although workers can theoretically turn down work, most assume – probably rightly – that such a refusal would mean no further offers, with no hope of redress.

As estimates of the extent of the phenomenon inexorably rise, there are calls for zero-hours contracts to be banned. The Business Secretary – who is reviewing the situation – is resisting. He is right to do so. The issue is not the deals themselves, it is how and why they are used.

A case in point is social care, which has long been disproportionately reliant on zero-hours arrangements. Why? Because government funding is too low to pay anything but the meagrest wages. As the population ages, the situation will only worsen. But super-flexible contracts are the symptom, not the cause, and banning them is to allow the specifics of one, very particular sector to skew a policy affecting all.

That is not to say there is nothing to be done. Vince Cable’s first priority is to establish the true scale of the issue. There is also a strong case for reform. Staff required to be always “on call” should be compensated. Businesses above a certain size – perhaps 50 employees – should be required to provide a minimum number of hours. (Larger companies have no excuse for passing on risks they can well afford.) Finally, basic employee rights must be enforced.

Before attempting anything more radical, however, it would be as well to see what happens as the economy improves. It is no surprise that the number of zero-hours contracts rose during a period of recession and stagnation. But it is essential that, as the outlook improves, staff are given more typical terms. If the current spike is no cyclical occurrence but, instead, presages a newly insecure, low-wage workforce, then the price of flexibility will be too high.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

PA / Team Secretary - Wimbledon

£28000 - £32000 per annum + Benefits: Ashdown Group: PA / Team Secretary - Mat...

Mechanical Lead

£65000 - £75000 per annum + competitive: Progressive Recruitment: Mechanical L...

Nursery Nurse

£8 per day: Randstad Education Manchester: Nursery Nurse The Nursery Nurse wi...

Primary Supply Teachers Required

£121 - £142 per day: Randstad Education Luton: primary teacher Hertfordshire

Day In a Page

Read Next
 

Fist bumps will never replace the handshake - we're just not cool enough

Jessica Brown Jessica Brown
The children were playing in the street with toy guns. The air strikes were tragically real

The air strikes were tragically real

The children were playing in the street with toy guns
Boozy, ignorant, intolerant, but very polite – The British, as others see us

Britain as others see us

Boozy, ignorant, intolerant, but very polite
Countries that don’t survey their tigers risk losing them altogether

Countries that don’t survey their tigers risk losing them

Jonathon Porritt sounds the alarm
How did our legends really begin?

How did our legends really begin?

Applying the theory of evolution to the world's many mythologies
Watch out: Lambrusco is back on the menu

Lambrusco is back on the menu

Naff Seventies corner-shop staple is this year's Aperol Spritz
A new Russian revolution: Cracks start to appear in Putin’s Kremlin power bloc

A new Russian revolution

Cracks start to appear in Putin’s Kremlin power bloc
Eugene de Kock: Apartheid’s sadistic killer that his country cannot forgive

Apartheid’s sadistic killer that his country cannot forgive

The debate rages in South Africa over whether Eugene de Kock should ever be released from jail
Standing my ground: If sitting is bad for your health, what happens when you stay on your feet for a whole month?

Standing my ground

If sitting is bad for your health, what happens when you stay on your feet for a whole month?
Commonwealth Games 2014: Dai Greene prays for chance to rebuild after injury agony

Greene prays for chance to rebuild after injury agony

Welsh hurdler was World, European and Commonwealth champion, but then the injuries crept in
Israel-Gaza conflict: Secret report helps Israelis to hide facts

Patrick Cockburn: Secret report helps Israel to hide facts

The slickness of Israel's spokesmen is rooted in directions set down by pollster Frank Luntz
The man who dared to go on holiday

The man who dared to go on holiday

New York's mayor has taken a vacation - in a nation that has still to enforce paid leave, it caused quite a stir, reports Rupert Cornwell
Best comedians: How the professionals go about their funny business, from Sarah Millican to Marcus Brigstocke

Best comedians: How the professionals go about their funny business

For all those wanting to know how stand-ups keep standing, here are some of the best moments
The Guest List 2014: Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks

The Guest List 2014

Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks
Jokes on Hollywood: 'With comedy film audiences shrinking, it’s time to move on'

Jokes on Hollywood

With comedy film audiences shrinking, it’s time to move on