Partner Article

The pros and many cons of zero hours contracts

Zero hours contracts can exist in many forms, but generally they are used to set out the work terms between an employer and a casual worker.

Shockingly new figures suggest that up to 5.5 million Britons (five times more than existing estimates) could be working under zero hours contracts, which can promise fewer than three hours of work a week.

Research by Britain’s largest trade union, Unite, has revealed that over one fifth of its members employed by private companies had deals that offered little or no guarantee of work and pay. Zero hours contracts provide employers with the advantage of immense flexibility; especially in industries and sectors where work can often oscillate, and the employer does not need to pay a worker when there is no work to do.

Corporations using this debatable arrangement include Sports Direct, McDonald’s, Amazon, JD Wetherspoons, Subway, Cineworld, as well as Buckingham Palace and The National Trust. Throughout local authorities, Unison estimates that almost all councils use zero hours contracts.

So what are the pros and cons of zero hours contracts?

Pros:

Certain workers are happy with the working conditions zero hours contracts offer. For groups such as students, house-parents, or pensioners who are looking for a little extra ‘top-up’ cash, zero hours contracts can often be a good solution.

Cons:

Although there are some arguments advocating zero hour contracts from a worker’s point of view, there are many, many more which oppose them.

For example, zero hours contracts are designed in such a way that workers (as opposed to employees) are not entitled to maternity leave, holidays, redundancy payments, the right to not be unfairly fired, or sick pay.

Also, zero hours contracts workers earn less than those on fixed-hours contracts, and often they are not allowed to refuse work if they do not want to be labelled as ‘inflexible’ and therefore no longer suitable for the role.

The growing use of such contracts in care homes is the consequence of an ageing population and the drive to cut costs, leading to poor care, and even neglect. Carework is thought to have the highest number of zero hours contracts workers, at an estimated 300,000.

After her local council ‘opted out’ of homecare, Caroline, a homecare worker, relays how she was “tupe’d over to a non-profit organisation and care workers lost their holiday pay, their sick pay, pension, and had their hourly rate cut. The cuts were massive and we lost more than half of what we had. Also the service user had their time cut. Then just over two years ago we got tupe’d over to a profit making company, as the non-profit lost the contract. Carers lost what little sick pay and contract hours we had. We were put on zero contract hours, were not paid for travel time but just paid on client contact. This happened three months after we were tupe’d over. Once again the service user’s time was cut [even further].”

As for the economy as a whole, pushing down salaries can lead to a decrease in spending (which leads to lower profits and pressure for even lower wages), a higher government bill for tax credits, increased debt for the individual person, or an increase in people claiming benefits.

Opposition

Despite various large corporations partaking in zero hours contracts, many big firms refuse to on economic grounds, for fear that the reputation of their firm will be tarnished, and they will face a public backlash. Large companies also feel that zero hour contracts will not nurture valuable employee traits, such as loyalty, customer care, and motivation accomplished through higher wages, and job security.

General Secretary of Unite, Len McCluskey, further condemns the increase of zero hours contracts, stating that they are, “blighting this country. [When] a quarter of a million working people do not know from one day to the next if they will be working or earning. How can they improve their lives if this is all the government has to offer?”

Article written by Amy Tanikie-Montagnani and reproduced from employersjobs.com’s blog.

This was posted in Bdaily's Members' News section by employersjobs.com .