Cable warns of exploitation of zero-hours contracts

 

Business Secretary Vince Cable: "I think at one end of the market there is some exploitation taking place"

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The Business Secretary Vince Cable fears zero-hours contracts are being abused after research suggested a million people could be working under them.

Mr Cable said he was concerned there was "some exploitation" of staff on the contracts which give no guarantees of shifts or work patterns.

The Chartered Institute of Personnel and Development found up to 4% of the UK workforce were on such contracts.

It surveyed 1,000 firms.

"I think at one end of the market there is some exploitation taking place," said Mr Cable.

However, he pointed out that in many cases the level of flexibility offered by the contracts suited employees. "It can work for the worker as well as the employer," he told the BBC.

Formal consultation?

Mr Cable has been leading a review on the issue for the government since June and will decide in September whether to hold a formal consultation on specific proposals.

Unions have called for them to be banned.

Dave Prentis, general secretary of the Unison union, said: "The vast majority of workers are only on these contracts because they have no choice. They may give flexibility to a few, but the balance of power favours the employers and makes it hard for workers to complain."

Despite controversy over their use, just 16% of those affected said their employer often fails to provide them with sufficient hours each week.

Start Quote

You feel bullied. You start at 06:30am, could work till 11:30am, then be told there's no more work for you today”

End Quote Karen, social care worker

This was higher amongst those who described themselves as part-time, where 38% said they would like to work more hours.

Under zero-hours contracts employees agree to be available for work as and when it is required.

Positive role

Figures from the Office for National Statistics last week suggested 250,000 workers were on zero-hours contracts.

CIPD chief executive Peter Cheese said the reason his survey showed up to four more times the number of people on zero hour contracts compared to official figures could be down to a lack of precision in the measurement, as well as confusion over definitions.

"I think even sometimes employers themselves are not fully clear on the absolute nature of their contracts and whether it is genuinely zero hours," he said.

"There does need to be a closer look at what is meant by a zero-hours contract, the different forms that they take, and clearer guidance on what good and bad practice in their use looks like.

"Zero-hours contracts, used appropriately, can provide flexibility for employers and employees and can play a positive role in creating more flexible working opportunities.

"However, for some this may be a significant disadvantage where they need more certainty in their working hours and earnings... Zero-hours contracts cannot be used simply to avoid an employer's responsibilities to its employees."

The news emerged as it was reported that part-time staff at retailer Sports Direct and a number of London councils were among those employed on such terms.

Fluctuating wages

According to the CIPD's research, firms in the voluntary and public sectors were more likely to use zero-hours contracts than those in the private sector.

The industries where employers were most likely to report having at least one person on a zero-hours contract were hotels, catering and leisure, education and healthcare.

The CPID said one in five employers in the UK had at least one person on a zero-hours contract. This means workers can be officially counted as employed, but have no guaranteed paid work and can be sent home from their workplace without warning and without having earned anything.

While zero-hours contracts may suit some due to the flexibility they provide, critics point out that the system can lead to fluctuating wages and a risk that managers may use their contract as both reward and punishment.

Graphic showing full-time workers, part-time workers and zero-hour contracts

Rochelle Monte is a care worker on a zero-hours contract and she told Radio 4's Today Programme that she gave her employer details of her availability and then had to "hope for the best".

"It can change dramatically over the space of a week.

"So you might start off a week thinking you've got 40 hours, but by the end of the week you could be down to 12," she said.

Colin Angel from the UK Homecare Association said zero-hours contracts were a response to the way that local authorities commissioned home care services.

"Councils buy 70-odd percent of all hours of home care - and it's proved to be the way that you can retain a workforce who are available very flexibly whose hours can change over a month.

"[It] works well for care workers who largely appreciate the flexibility that their contracts have," he said.

At places of employment found to be using the contracts, the average number of workers who were on them was around 16%, according to CIPD.

Based on these figures, CIPD calculated that between 3% and 4% of all workers were on zero-hour contracts - equating to a million people in the UK labour force.

The employees who took part in the poll worked an average of just under 20 hours a week and were most likely to be aged between 18 and 24 or over 55.

 

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  • rate this
    +8

    Comment number 121.

    99. Lightmare -Feckless and something for nothing? No the bankers and MPs are still doing quite well. Nice to see you swallow the Westminster lie, the economy is uneven, unbalanced and guess what Welfare spending has gone up not down. Keep reading the Beano facts that Murdoch and co pump out, everything is ok.

  • rate this
    +8

    Comment number 120.

    None of the scum that run this country are on zero hour contracts

  • rate this
    +5

    Comment number 119.

    I believ we should put MP's and those in the Lords on this type of a contract too - those who don't have anything to say or do need not turn up at our expense - now that would be real savings

  • rate this
    +69

    Comment number 118.

    I had to work on one of these contracts

    The plus side is you can pickup work quickly

    The downside is you are treated like dirt, the regular staff dont talk to you and the bosses look at you and talk to you as if you are worthless

    The money is not good and the hours and terms make you have a sad face :(

    A job is better than no job but not knowing if you are working when you wake up is more :(

  • rate this
    -1

    Comment number 117.

    Funny how non of the right wing press have reported on this story. You'd think that they would be all over this being such a big story. Yet when we have a storm in a tea cup over John Humphrey's story not being shown due to political bias. We get the Daily Mail with words such as FACT in there frontpage headlines.and calls of foul play from the so called left wing BBC.

  • rate this
    +6

    Comment number 116.

    Welcome to the Tory world of rebalancing the economy from the Have Nots to the Have Yachts. This is their Big Society, and their mendacious claims to having "created" over 1m jobs in the Private Sector. UK can never now complain about slave labour in the sub continent. It is here on our door step. Rejoice at the Tory propaganda!

  • rate this
    +9

    Comment number 115.

    @37. johnboy99

    "Never trust the Tories."

    And the others, mate.

  • rate this
    +7

    Comment number 114.

    These contracts are ridiculous and they mask the real unemployment figure. Unemployment should be redefined into those in full time, part time and those on Zero hour contracts. The German economy goes from strength to strength because it recognises the worth of its workforce and the benefits of a properly regulated employer / employee environment.

  • rate this
    +5

    Comment number 113.

    Disgusting. How can people live? Not knowing how many hours they're working or when - how do people sort out childcare; apply for mortgages without knowing annual income; book holidays etc. I know that employees are having it rough but how do they get loyal, motivated staff if they treat them like a herd of cows! Time the government adopted a less Dickensian attitude. What next? Workhouses!

  • rate this
    +5

    Comment number 112.

    Zero hours contracts need to be overhauled so that the employee has protection from unscrupulous employers who are all to happy to abuse the system, franchised fast food chains in particular abuse zero hours contracts.

  • rate this
    +8

    Comment number 111.

    These are the non-job figures that the government uses to con people into thinking that unemployment is falling...

    CONservative.. the clue is in the name.

  • rate this
    +6

    Comment number 110.

    These have come about as a result of a loophole in NMW and WTD law.

    Standby, at or near a place of work must be paid and the hours counted.

    However, standby at home does not count, so in effect employers can get up to 8,760 hours per year standby duty completely free.

    Given texts, phone, and email, the distinction's meaningless, and should be scrapped. All standby should be paid.

  • rate this
    0

    Comment number 109.

    The problem is that this is the type of contract that our competitors overseas use. This is why we do so badly in manufacturing. We need to make changes in this county as every one is entitled to some stability in the work they do. We should also be looking at the terms and conditions of workers who make the items we import and if necessary impose tariffs on those that use similar methods.

  • rate this
    +27

    Comment number 108.

    One thing company's that use these type of contract should take into account

    Zero hours goes hand in hand with zero commitment.

    Treat people like s**t and you can expect it to be reciprocated.

  • rate this
    +4

    Comment number 107.

    There are only three words to describe this practice: evil and corrupt. But then what else would you expect from the Conservative Party?

  • rate this
    -16

    Comment number 106.

    You are happy the blame business, but they need to make money just like you to survive.

    If you are not happy with it why don't you make your own business? Apply your own model where all are equal in every role they do, from the cleaner to management.

    Keep moaning, it solves all of your problems. Moaning helps put food on the table, moaning keeps the lights on. Yes, moaning helps...

  • rate this
    -1

    Comment number 105.

    As a retired local government officer I am happy to have a zero hours contract and work a few hours if and when required. It means that rather than bring in a temporary worker with no knowledge, an experienced ex employee can cover for long term illness, maternity leave etc. Cheaper than using an Employment Agency and much better use of our Council tax believe.

  • rate this
    -3

    Comment number 104.

    We cant allow the abuse of the method by large firms & councils outlaw this practice. SMEs need the flexibility of employing people on the basis of their own workload and this is a solution. Trust me, if zero hours is banned, SMEs will simply reduce their workforce to those they can employ with certainty, and overwork them to meet peaks in demand. Your choice.

  • rate this
    +7

    Comment number 103.

    A lot of agencies use zero hours contracts and it`s the worst kind of employment as far as the employee is concerned. A friend worked them for several years and he said it was impossible to plan financially and was constantly worrying about whether he would have enough money to pay the bills. He asked for a full time vacancy and was told if you don`t like it there`s plenty to replace you.

  • rate this
    -3

    Comment number 102.

    Not ideal, but surely better than having NO job

 

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