Are zero hour contracts creating ‘disposable labour’?
The number of people on zero-hour contracts has increased by1 3% over the past year reaching a record 905,000, according to new figures released by the Office for National Statistics.
Some workers actually prefer the flexibility of a zero hour contract but The Resolution Foundation says that overall workers on such contracts face a significant pay penalty – typically earning £1,000 a year less.
Despite the rise across the year, zero hour contracts have slowed in recent months, which the Foundation attributes to a combination of factors, including firms struggling to fill contracts that do not guarantee any hours of work in a tightening labour market, the reputational risk now associated with zero hour contracts, and a much higher awareness of the contracts having been achieved in recent years.
There are also signs of intergenerational flux in the figures, with over two-thirds of the increase over the past year driven by those aged 50-64, whereas the number of people aged 16-24 on ZHCs has fallen by 5,000. However young people are still disproportionately likely to be on a ZHC – 7.5 per cent (300,000) of those aged 16-24 in employment are on one.
Dan Tomlinson, Researcher at the Resolution Foundation, said:
“The number of people on zero hours contracts has reached an all-time high at the end of last year, further confirming that they are now a permanent feature of our jobs market.
“The slowdown is likely due to a strong jobs market meaning that job hunters now have more options available than taking a contract without guaranteed hours, firms being reluctant to be associated with using zero-hours contracts following the bad press received by firms like Sports Direct, and the high profile of these contracts meaning there is no backlog of people reporting being on one artificially boosting numbers.
“Zero-hours contracts are by no means the only form of insecure work. More scrutiny must be given to the large rise in self-employment, and other less-discussed areas of insecure employment such as agency work and short hour contracts. The government should ensure, through the Taylor Review, that workplace rights and responsibilities are brought up to speed to reflect these shifts.”
The TUC, who have expressed ongoing concerns about employers using zero hour contracts, are keen to find out how insecure employment is affecting workers and has launched a new initiative for workers to share their experiences of insecure work anonymously. They will present their findings in May.
TUC General Secretary Frances O’Grady said:
“Zero-hours contracts allow bosses to treat workers like disposable labour. You have no guarantee of work from one day to another. Put a foot wrong and you can be let go in a heartbeat. Turn down a shift because your kid’s sick and you can be left with little or no work.
“That’s why employment law needs dragging law into the 21st century. Far too many workers do not have the power to challenge bad working conditions.
“Zero-hours contracts can be a nightmare to plan your life around. And are a huge drain on the public finances – the growth in zero-hours working over the last decade is costing the government almost £2bn a year.”
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