Zero Hours Contracts: The Latest Evidence.

Zero Hours Contracts: The Latest Evidence.
The Office of National Statistics estimates that there are 583,000 or 2% of the total workforce on Zero Hour contracts. The Chartered Institute of Personnel Development (CIPD) estimates a figure of about 3% based on their evidence from employers. Most zero hour workers are in hospitals, about 75% , with 51% in Further Education.

The justification for these contracts is they offer flexibility to both the employer and the employee. The benefits to the employer are clear. They can adjust employee attendance at work to deal with booms and slumps in demand. For the employee the situation is not so clear.

Specifically, there is an exclusivity clause which stipulates that the zero hours worker may not look for work elsewhere whilst with the current employer. Clearly, this limits the flexibility of the worker. The CIPD evidence shows that about 40% of employers use this clause. Further not all workers are aware that they are on this contract, until their wages drop.

The CIPD evidence says that most workers are happy with zero hours, especially nurses in the NHS. Here, these contracts are long established, and well managed. However, it is still the case that zero hours gives more employer flexibility than agency workers, with written contracts
The only right a worker has is to be an employee with a fixed hours contract, after 12 consecutive months of a broadly consistent work pattern. This is important as the worker becomes an employee with a long list of rights, including to be protected for “whistle blowing”. However, this creates a perverse incentive to sack workers before 12 months elapse.

What is to be done? Exclusivity clauses should be made illegal. Workers should become employees as soon as the law can change. Employers should have to provide a brief written summary to all employees of rights responsibilities and pay, within one week of starting work. A much fuller legal contract should follow soon after.


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