Zero hours contracts: where do you stand?

Dec11

Posted in HR

Man in a business shirt waits for a call

They’re one of a range of tools employers can use to ensure their workforce has the flexibility to respond to demands. They’re unfairly demonized and the majority of people on them are perfectly happy. Or, to put it another way, zero-hours contracts are a workplace evil, with employees frog-marched onto them against their will, forever ruining their chances of getting a mortgage or secured loan.

Few workplace issues are quite so polarizing as zero-hours contracts. So where do you stand?

Happy with zero?

If your business makes use of zero hour contracts, then the Chartered Institute of Personnel and Development has some good news for you. Far from being seen as a cynical move to avoid sick or holiday pay, a new CIPD survey suggests the majority of people on zero-hours contracts are generally happy with their lot.

The survey of 1,000 workers may reveal a significant level of dissatisfaction (40%), but that dissatisfaction is marginally lower than employees on other contracts. Zero-hour contract workers are happier with their work life balance than other contract workers and 52% of those surveyed didn’t want any more hours than they were currently being given.

This led CIPD chief executive, Peter Cheese, to suggest that “The use of zero-hours contracts in the UK economy has been underestimated, oversimplified and in some cases, unfairly demonized.”

Nought and cross

Unite, the UK’s largest trade union, sees things rather differently. As Payroll World reports, the union believes zero-hour contracts are being misused by some employers who see them as a legal route to avoid paying holiday pay and other workplace benefits.

Steve Turner, Unite assistant general secretary, is reported as describing the CIPD as being “divorced from reality.” He points to the large levels of dissatisfaction revealed in the survey and identifies those seeking mortgages, secured loans or any degree of job certainty as being poorly served by the contracts.

Speaking to Payroll World, Bill Hayes, general secretary of the Communication Workers Union (CWU), accepts that zero-hour contracts may work for some sections of the community, but suggests they are indicative of wider sinister practices within the workplace.

“Zero-hour contracts are the tip of the iceberg in terms of the flexible labour market and we fear abuses are rife across this sector.”

“Balancing the debate”

The CIPD’s Peter Cheese does accept there is work to be done, but believes the argument is less about reforming zero-hours contracts and more a case of ensuring they are managed properly.

“The emphasis should be on improving management practice and enforcing existing regulation first, rather than bringing in new legislation which would be extremely hard to do without unintended consequences.”

The Department for Business, Innovation and Skills (BIS) supports this view. Payroll World quotes a spokesman as saying: “We want to make sure people are paid and treated fairly, but don’t want to hinder flexibility in the jobs market at this delicate economic time.”

Tom Hadley, from the Recruitment and Employment Confederation (REC), believes the CIPD report brings some “balance” to the debate on zero-hour contracts and echoes the desire to avoid over-regulation: “The focus for government must be to ensure that workers have the right skills and awareness to progress within the jobs market – whatever the type of contract they are on.”

Are you considering making zero-hour contracts a part of the way you work? Talk to us about the things you need to consider – and the things we can do to help make switching to zero hours easier.