Increase in number of zero-hours contracts

Increase in number of zero-hours contracts

The number of workers on zero-hours contracts has increased by almost a fifth to 744,000, new figures show.

People on a zero-hours contract in their main job represented 2.4% of all those in employment in April-June, compared with the same period a year ago, the Office for National Statistics said.

The new figure will fuel fresh controversy over the use of the contracts, under which employees do not know how much work they have from one week to the next.

Research published by the TUC shows that average weekly earnings for zero-hours workers are £188, compared to £479 for permanent workers.

Two-fifths of zero-hours workers earn less than £111 a week – the qualifying threshold for statutory sick pay – compared to one in 12 permanent employees.

The TUC estimates that in addition to Britain's zero-hours workforce there are another 820,000 UK employees who say they are underemployed.

TUC general secretary Frances O'Grady said: "Zero-hours contracts are a stark reminder of Britain's two-tier workforce.

"People employed on these contracts earn £300 a week less, on average, than workers in secure jobs.

"I challenge any minister or business leader to survive on a low-paid zero hours contract job, not knowing from one day to the next how much work they will have."

Labour leadership contender Jeremy Corbyn said: "The figures show an increasing trend of work becoming more insecure, low paid and exploitative. But this is only the tip of the iceberg with growing numbers underemployed or forced into unpaid workfare schemes, internships, and low quality apprenticeships."

Jon Ingham of jobs site Glassdoor said: "It's no great surprise to see the number of people on these contracts is on the up. The fact that many of those surveyed in the ONS study might not know what a zero-hours contract is could mean the scope of the problem is far greater than the figures indicate.

"With 255,000 of these contracts held by 16 to 25-year-olds, it doesn't feel like the best start in their careers. But for many it's all they know so they just get swept along and accept this 'pay as you go' employment as the norm.

"Sadly, ONS figures show that 40% of those on a zero-hours contract want more hours."

The ONS said people on zero-hours contracts are more likely to be women, in full-time education, or older and younger workers.

Someone on one of the contracts usually works 25 hours a week.

The report said two out of five people on a zero-hours contract wanted more work, usually in their current job.

The ONS estimated there were around 1.5 million contracts that do not guarantee a minimum number of hours, confirming that many workers are on more than one zero hours contract.

The figure, for January, is 91,000 higher than the same month in 2014.

Laura Gardiner, senior policy analyst at the Resolution Foundation think tank, said: "Capturing the true scale of zero hours contract working has proven challenging in recent years but it is clear that this form of working is not fading away as our employment recovery gains ground.

"While it's true that some people value the flexibility offered by zero hours contracts, for many they bring deep insecurity. Alongside reduced employment rights, the potentially irregular nature of earnings they provide makes it hard to budget and plan ahead.

"Policymakers must act to ensure that the benefits of labour-market flexibility are balanced appropriately with protecting workers' rights."

Andrew Hunter, of jobs site Adzuna, said: "The proportion of workers on fragile zero-hours contracts has swelled over the last year despite calls to give these positions more security.

"But the increase highlights an appetite for flexible working that is not yet being met, as well as an ongoing need for some sectors, particularly retail and food, to respond quickly to changes in supply and demand."

GMB general secretary Paul Kenny said: "All across the economy the deal employers are offering workers is seriously decreased while workers often have little alternative but to accept what is on offer."

He said workers in a number of areas were "fighting back" by campaigning for fixed hours.

A Business Department spokesman said: "Zero-hours contracts have a part to play in a modern, flexible labour market.

"For workers such as students and those with caring responsibilities they provide a pathway to employment, particularly when the individual cannot commit to regular hours.

"However we have acted to ban the use of exclusivity clauses in these contracts which prevent people from boosting their income when they have no guarantee of work.

"This is giving working people the freedom to take other work opportunities and more control over their work hours and income."

Unite assistant general secretary Steve Turner said: "The continued rise of zero-hours contracts underlines how government claims to be on the side of working people are nothing more than lip service.

"These figures are the tip of an insecure iceberg - they do not include short hours contracts and the wider rise in insecure, precarious work across the economy."

Chuka Umunna, shadow business secretary, said: "These stark figures show that the Tories are the party of insecurity at work.

"Zero hours work is on the rise with the total number of contracts rising to 1.5 million and the number of people reporting their main source of employment as a zero-hours contract having risen by almost 20% since last year. At the same time, there are now over 1.2 million people working part time because they could not find full time work - 200,000 more than when the Tories took office in 2010.

"Ministers are watering down vital protections at work and have refused to act to protect workers on zero hours contracts. As long as ministers are happy to sit aside and encourage the proliferation of insecure work, more and more people won't have the security of knowing where their next pay cheque is coming from or being able to plan ahead."

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