A new Office for National Statistics (ONS) report – ‘Contracts that do not guarantee a minimum number of hours: April 2018’ – plus data from the latest Labour Force Survey and an ONS business survey, estimated that 6% of UK employment contracts were carried out on a zero hours basis in November 2017. This equates to 1.8 million contracts, which is an increase of 100,000 on the equivalent figures for November 2016.
Zero hour contracts refer to those where no guaranteed hours are offered to the worker.
According to the report, over 54% of those on zero hour contracts were women and 66% work part-time. Of younger workers, over 8% are still in full-time education and 36% are aged between 16 and 24.
Head of policy at the Recruitment & Employment Confederation, Sophie Wingfield, said:
“Many people on zero-hours contracts are in full-time education – the advantage of having that flexibility allows students to fit in hours around their studies. Flexible contracts also offer employers the ability to respond quickly to the fluctuating demands of the economy.”
She added:
“When managed well and by choice, such contracts are an important means of offering people increased choice and flexibility in their working lives. These contracts also offer a part-time option that people choose to fit around their other commitments and data has shown that more than half of employees on zero-hours find that it creates a positive work-life balance. For some workers it won’t be their only job, but a way to top up with additional income or get experience in a new or different field.”
However, Catherine Sermon, Employment Director at Business in the Community, stated that many people were facing a choice between jobs that fail to lift them out of poverty or continuing in unemployment, which she considered was no choice at all.
Low pay experts have been approached to formally seek their views on the impact of higher minimum wage rates for those on zero-hours and non-guaranteed hours contracts. The government has promised to review the recommendations made in the Taylor review in July 2017 but the experts say the real test will be whether it is implemented in the future.
Diane Nicol, Partner at Pinsent Masons - and a Taylor review panel member - stated that the review “considered the thorny issue of how to protect those who are in more precarious engagements – such as zero-hours contracts and non-guaranteed hours contracts.”
She also asked the Low Pay Commission to consider how a higher national minimum wage might “apply to these more precarious workers”.
The Low Pay Commission is presently consulting on the minimum wage and will publish its findings with its annual wage report. This will also take into account the impact of the wage proposal for zero hours contractors. It will also consider practices employed by countries where zero hour contracts are banned, or where employers are fined for giving less than three hours notice of work shifts.
