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Zero-hours contracts criticised for benefiting business, not staff

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The number of people on zero-hours contracts has risen by 20% since the same time last year

Zero-hours contracts primarily benefit employers to the detriment of workers, according to experts commenting in the wake of ONS stats showing that the use of zero-hours contracts has risen dramatically.

The data revealed the number of people on zero-hours contracts has risen by 20% since the same time last year. 903,000 people in the UK are on these contracts, up from 747,000 in 2015. According to the TUC the median hourly rate for a zero-hours worker is £7.25, while for all employees it is £11.05.

Marc Jones, an employment law specialist and partner at Turbervilles Solicitors, told HR magazine that people should not forget who zero-hours contracts mainly benefit.

“Companies like Sports Direct aren’t thinking that zero-hours contracts will be really good for their staff,” he said. “What an employer wants is to be able to say ‘we don’t need you tomorrow when business is slow, but the day after when it picks up we expect you to be available to work'.”

He also warned that if companies keep getting bad press for using zero-hours contracts they may simply switch to using a different name for a contract that operates in the same way. “There is a public stigma attached to zero-hour contracts and this could well give rise to similar types of contract but under different labels, such as a one-hour contract, which on the face of it provide more certainty to workers but in reality may be no different to zero-hours contracts,” he said.

TUC general secretary Frances O’Grady cautioned that zero-hours contracts have become an easy way for bosses to employ staff on the cheap. “There is no getting away from the fact that zero-hours workers earn less money and have fewer rights than people with permanent jobs,” she said.

“If you don’t know how much work you will have from one day to the next paying bills and arranging things like childcare can be a nightmare. These figures are a stark reminder of why we need to create more decent jobs people can actually live on.”

Laura Farnsworth, partner in the employment group at law firm Lewis Silkin, agreed that businesses benefit from the flexibility of zero-hours contracts. “As customers and clients increasingly demand agile services – from on-demand legal services, to ad-hoc technical support, to crisis management – an ability to offer solutions that can be quickly scaled up or down, with resources redistributed to cover emerging priorities, is becoming business-critical for many,” she said. “Zero-hours contracts can have an important role to play on this rapidly evolving stage.”

However, she also argued that zero-hours contracts can benefit the worker. "Managed effectively and fairly, zero-hours contracts and the like can have real benefits for workers that can be easily overlooked in the context of negative media reporting,” she said. “For some they offer the freedom and flexibility to explore new opportunities, for others they enable a career that also accommodates family life or other commitments.”

Sports Direct, which has faced criticism for its poor working conditions, has recently vowed to offer shop staff guaranteed hours instead of zero-hours contracts. However, it has not made the guarantee to staff at its Shirebrook depot, who are mainly employed by agencies.