Zero hour contracts have been hailed as the saviour of the UK’s economy on the one hand, by providing businesses with a responsive and flexible workforce. On the other, they have been damned as a return to Victorian-style abuse of exploited workers whose rights in reality only exist on the statue book and not in fact.
From both perspectives, it is the resulting flexibility of the workforce that has led to the growth and popularity of zero-hours contracts, and to their inevitable abuse. But is the flexibility a one way street?
Some argue that there are strong parallels between self-employment, contracting and zero-hours contracts, and that is one of the attractions to employers. The self-employed and contractors deliver on each job because if they don’t, it will be their last with that client. They rarely go sick (and don’t get paid if they do) and don’t have baggage in the form of expensive benefits and rights.
Those on zero-hours contracts also work hard on each shift, take little time off sick – or at all for that matter – and qualify for fewer rights than a permanent employee. But there the parallels end. Furthermore, many workers accept zero-hours contracts for all the wrong reasons, and for completely different ones to contractors and the self-employed.
Ironically, flexible zero-hours employees of many well-known consumer brands enjoy zero flexibility. You work when you’re told, you come in at very short notice, even in the middle of the night, and if you don’t accept absolutely every shift you are given you are likely not to be offered further work.
Asking for time off to meet a personal commitment leads to threats of being sacked for being unavailable. If you get sacked, this impacts on your ability to claim benefits because by refusing a shift, you put yourself out of work.
In some high-profile fast-food workplaces, you are expected to undergo unpaid training in your own time and have to officially sign off before undertaking some tasks, such as cashing up. In others, when customers change their minds about what they want after being served, this can be taken off employees wages; and if a ‘shared’ till is short of cash, that money comes out of your wages.
For those people who are desperate for cash as they’re working to support families and pay rent, this leaves them very open to the worst sort of exploitation.
Does this really sound like contracting or self-employment?
Legislation such as IR35 (yes, in its earliest forms) and the Agency Workers Regulations (AWR) were introduced to protect vulnerable workers. That’s because there was a school of thought by policymakers that contractors couldn’t possibly have chosen not to be full-time permanent employees. Surely they had been forced into contracting and should be protected?
Genuine contractors, even those in umbrella companies, didn’t need nor ask for any protection and remain relatively unaffected by AWR and IR35. However the temps who were supposed to have been protected by the rights provided by AWR have slid even further down the abuse food chain, many into zero-hours contracts.
Certainly there is ample anecdotal evidence that temps approaching AWR’s 12-week qualifying period for equal pay are simply switched to another agency the day before they are due to gain their new rights. Even worse, they are sometimes sacked, even when the client is keen to keep them on.
We’ve had one worker tell us that when an agency forgot to transfer a group of workers over to the new agency, and they’d been working for 13 weeks for the same agency and client, everyone was told to sign a retrospective Swedish Derogation contract. The alternative was no more work.
Flexible workers on zero-hours contracts are nothing like contractors, because there is no agreed outcome or deliverable. There is a world of difference between choosing to become a contractor and work flexibly on a defined contract and being abused with a zero-hours contract.
Business Secretary Vince Cable’s review of the use of zero hour contracts is timely and needed. A flexible worker economy is essential for the success of the economy, and the UK generally does pretty well when it comes to its flexible workforce; but zero-hours contracts as they are currently used and abused are a step too far.