Report Says Zero-Hours Contracts 'Should Not Be Used'

An interim report has said that "in the majority of cases" zero-hours contracts should not be used at all.

In the report, published today, the Scottish Affairs Committee has described the increase in zero-hour contracts as "alarming" and say that the government should be using all the levers at its disposal, including legislation, to change this.

The Committee says the Government's consultation on zero hours contracts is too narrow, saying that it is focused on exclusivity and transparency. The Committee says addressing those concerns will do little to help workers who are exploited by unscrupulous employers.

Evidence to the Committee showed:

• 20% of workers on zero hours contracts are paid less than their permanent equivalents doing the same job

• 5% are paid less than the national minimum wage although this is illegal thousands of social care workers are illegally denied payment for time spent travelling between appointments

• 40% receive no notice of employment

• 6% turn up for work – having paid for childcare, travel etc – to find none available

• Thousands of others' employers evade the provision of basic employment rights

• Zero hours workers are entitled to limited employment rights but a significant proportion of employers are either ignorant of those rights or are wilfully blocking access to them.

The Committee describes the Government's suggestion that a low-paid worker can challenge their employer through the courts as "fanciful", as litigation is expensive, the lack of a legal definition of a zero hours contract hinders any legal challenge, and any zero hours worker who embarks on such a challenge may be penalised by the employer.

The Committee says:

• Zero hours contracts must only be used where the employer can objectively justify it

• The Government must do more to protect workers who wish to challenge unfair, unsafe or unlawful conditions of employment

• Workers should be told from the outset of their employment what type of contract they are on and a written contract setting out the terms and conditions must follow within two months

• There should be a minimum notice period of work and workers should not be punished for turning down offers of work made within that period

• Where workers arrive for work but find none available then the employer should compensate them for the inconvenience

• Travel time between appointments should be paid and pay for zero hours workers should accurately reflect the number of hours that are worked to fulfil contracted duties

• An employer-led Code of Practice is unlikely to help workers who are exploited – in fact it may serve to embed a form of employment that in most circumstances is hard to justify

• If a Code is produced it should only be as a stepping stone to, or following, legislative change aimed at reducing the use of zero hours contracts and ensuring workers receive the income, rights and protections to which they are entitled.

Chair of the Committee Ian Davidson MP said: "The overwhelming majority of zero hours contracts are abusive and exploitative and should be abolished. In most cases their use is evidence of sloppy, lazy or incompetent management, who intimidate their workforce by keeping them insecure.

"Zero hours contracts put workers in such a vulnerable position that they are unable even to assert their lawful right to the meagre benefits these contracts offer.

"We heard how workers, without any kind of job security, were fearful of questioning the terms of their employment, even when they knew they were being treated unfairly, and that they were reluctant to challenge unsafe working conditions.

"Many felt that they could not turn down work, no matter how short the notice or however inconvenient the shift offered, in case doing so jeopardised future offers of work.

"Zero hours make blacklisting easy. Our detailed recommendations would improve the operation of zero hours contracts but our overriding conclusion is that, in the majority of cases, zero hours contracts need not and should not be used at all.

"Organisations in the public and private sectors should look first to contracts of employment that offer guaranteed hours and full employment rights.

"We believe the UK and Scottish Governments must use every lever at their disposal to affect a cultural change against exploitative contracts."

This report is an interim one, as it is being timed to contribute to the UK Government's consultation on zero hours.