Why Zero-hours contracts should be banned


by Natalie Bennett    
9:02 am - August 8th 2013

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Imagine you get a phone call at 6am each morning, to tell you if you’ll get any work – or pay – each day. You’re awake, dressed, waiting, then it’s “stand down”. That can happen five days in a row, and you’ll get to the end of the week without a penny coming in to your pocket.

Imagine you’ve got to arrange childcare whenever you have to go to work – and you only get a couple of hours’ notice that you have to go to work. That’s not a situation that far too many British workers have to imagine – that’s their reality.

All of those cases I was told about by audiences to whom I’d been speaking about zero-hours contracts. And they’ve strengthened my conviction that these contracts should be banned.

It’s an issue that I’ve been addressing since I was elected Green Party leader almost a year ago, and I’ve noticed a trend. When I first asked meetings “do you know what zero-hours contracts are?”, I’d get lots of head-shaking, and would need to explain. Yet in the past month or two, that’s rare – in part no doubt because of publicity about the issue, but also it seems because the employment practice is spreading fast.

It’s still most common, and most known, in the sectors in which it began, in retail and care. And defenders of zero-hours contracts, like this Telegraph leader, which claims “many people have to take uncertain, unskilled jobs is because they lack the training to do anything else”. And many of the high-profile cases that have emerged in recent days, McDonald’s and Subway, and Sports Direct, have been in retail.

But – ignoring the question of whether caring for vulnerable elderly, disabled or young people really is something that should be regarded as an “uncertain, unskilled” job (or for the fact that other countries treat retailing as a proper career) – that’s a misunderstanding.

For these contracts are spreading like a disease among a wide range of workers, from academics, to IT professionals, to accountants, to lawyers, to doctors and nurses.

One claim often made about these contracts – indeed it was made yesterday morning by Ruth Porter of the Institute for Economic Affairs when we debated the issue on BBC Radio Ulster– is that they are desperately needed by struggling small businesses. But that’s belied by the facts – it’s 23% of workplaces with more than 100 employees that are using them, and only 6% of the businesses with fewer than 50 employees.

Yes, there are a few workers who these contracts suit perfectly, and they might be disadvantaged by a ban. But the cost of having them available to employers, and used with abandon, far exceeds any benefit.

Flexibility can be maintained without leaving workers trapped, as Larry Elliot in the Guardian said, in a digitised version of the early 19tt century dockers line-up. Seasonal contracts, contracts with guaranteed hours that are flexible about when those hours are worked and allow staff to take other jobs as well, we might look at the German model which demands that a maximum of 25% of a contract can be flexible hours.

The Green Party is calling for zero-hours contracts to be banned, as part of a broader shake up of our labour laws. What we need from our economy are jobs that workers can build their life on – that pay a living wage.

Then workers can rent homes, start families, think about mortgages – or at the very least be certain of being able to pay for food and essential bills at the end of the week.

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About the author
Natalie Bennett is leader of the Green Party of England and Wales
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Reader comments


The labour market is just that….a market.

Employees sell their labour on the market and employers buy that labour at an agreed price and with agreed terms and conditions.

Any interference by the state- setting minimum wages or imposing external conditions to be met through employment law is a violation of the voluntary nature of the employment contract and prevents the market working as well as it should do. “Banning” a type of contract that would, otherwise, be agreed falls into that category.

Every time you perceive exploitation you should ask yourself one question before trying to impose your will.

Is there any element of coercion involved?

If the answer to that question is “no”, you should resolve to keep your nose out of other peoples affairs.

Typical neo-classical economics garbage.

these contracts are clearly coercive, as they are presented on a take it or leave it basis with, for the unemployed, the clear threat of a loss of benefit.

The State has a duty to intervene in employment matters as there is a clear asymetry of power and information, whichh means that there cannot be a true market.

Larry Elliot of the Guardian wrote this (see link above):

“Bodies representing employers say zero-hours contracts should be welcomed since without them unemployment would be even higher. Better, they say, that people should be working 20 hours one week and no hours at all the next rather than be on the dole.

Seen in this light, Vince Cable – who is conducting a review of the contracts – should be thinking of further deregulation of the labour market rather than contemplating measures that might reduce this “flexibility”. He could, for instance, repeal the 1874 Factory Act that banned children under 10 from working in a manufacturing plant. He could rethink the 1847 10-hour Act that said children should not work for more than 10 hours a day. He could be really bold and say that Parliament erred in 1841 when it voted in favour of the Mines Act that prevented a child under 10 from working underground in a pit. Because, let’s face it, all this legislation represented regulation of the labour market that made it less “flexible”.”

If you don’t agree with the (sarcastic) view that these laws should be repealed, tell me what the difference is.

“The Green Party is calling for zero-hours contracts to be banned, as part of a broader shake up of our labour laws. What we need from our economy are jobs that workers can build their life on – that pay a living wage. ”

I guess we’ve got to ban all freelance contracts therefore. Natalie, our host here Sunny, myself, we’ve all written pieces for The Guardian. The Guardian promises us no particular amount of work. They may or may not take a piece of work at any time. It’s very similar indeed to a zero hours contract.

Ban this disgusting practice I say!

@ Pagar

Would you be willing to work on a zero hours contract yourself? Since you consider it ok for others to have such blatantly unfair working practices and insecure incomes. You do realise that as it will reduce the dependability of your income that you will naturally spend even less in the economy.

In addition to MarkAustin’s comments, what would the aggregate consequence of that be? Another recession in which even more of your favourite businesses go bankrupt? Take your neoliberal quarterly ‘profit’ blinkers off and see the reality please. Lurching even further to the bottom will turn Britain into yet another failed banana state!

I’m not sure if it has since been changed, but I believe it’s possible to quit zero hours contracts and immediately start being able to claim jobseekers.

6. Paul peter Smith

Zero hours contracts are the new incapacity benefit. Part of my job is to help people recently reclassified as fit for work by the benefits ‘shake up’, to find a job. They are given no choice at all, they take whats on offer (at best a zero hour contract) or they’re screwed. The main push to put so many people on incapacity in the first place was to fiddle the unemployment figures. As zero hours contracts are a cheaper, liability free alternative I wouldn’t look to any government to change anything in a hurry.

@Tim – The Guardian doesn’t prevent freelance contributors from contributing to other publications so your comment and sarcasm is somewhat misplaced!

@ 7 Squack

I’d be very surprised if a zero hours contract prevented you from working anywhere else either.

Zero-hours contracts used to be called “Temping” and nobody had any real problems with that, until somebody gave it a fancy name.

Classic green bansturbation in the OP!

The charity I work for uses zero-hours contracts. In my experience, zero-hours contracts have strong advantages for
* people who are retired and only want to work occasionally
* people with part-time jobs who can manage to fit in a little extra work only occasionally
* job-seekers entering the labour market for the first time or in a new sector, as a zero-hours contract provides the opportunity to gain experience and gives them with a foot in the door when a permanent position becomes available.

The contracts are not inherently coercive, and they suit many people’s lifestyle. They are also very useful for employers who have seasonal peaks of demand or who are vulnerable to outbreaks of sickness.

squack @ 7: a zero-hours contract does not prevent you working for another employer, so I’m afraid yours is the misplaced comment.

10. Robin Levett

@Tim Worstall #3:

It’s very similar indeed to a zero hours contract.

Apart from the fact that under a freelance contract a writer isn’t employed, has no obligation to hold him/herself available at short notice to work any specific hours with no correspondign obligation to provide worrk to do, is free to work for anyone else s/he sees fit – in other words, a freelance contract is almost, but not quite, entirely unlike a zero-hours contract – your view is of course precisely correct.

11. Paul peter Smith

@8
With a couple of exceptions like Hop picking and Pea pulling, temping was never the rule in most industries. Whole sectors are moving to zero hours contracts meaning there is no choice for most people. A free market means choice doesnt it or do you take it to mean the imposition of that which has been deemed most efficient by the recipients of the lion’s share of the produce. Can somebody give me an example of a functioning free market other than the drug trade?

@6 PpS

‘They are given no choice at all, they take whats on offer (at best a zero hour contract) or they’re screwed’

Surely this is perfectly reasonable – if you are deemed fit to work and claiming benefitsd surely you should take any job that is offered to you?

Or have I misinterpreted what you have written?

13. Robin Levett

@Fungus #12:

Surely this is perfectly reasonable – if you are deemed fit to work and claiming benefitsd surely you should take any job that is offered to you?

Or have I misinterpreted what you have written?

I think that whetehr it is reasonable depends on your definition of “job”.

I would suggest concerned individuals add the companies exploiting their workforce to a list with whom they are not prepared to do business ie those companies dodging tax ,those banks involved with crooks, those Telecommunications companies readily handing over your data to the feds etc etc.
In a free market consumers should also exercise informed choice.

15. Paul peter Smith

@12
No I didnt explain it well enough, with regard to recently reassessed persons. The assessors are acknowledging many of them are unfit for most work but declare that they could work a couple of hours a day, sitting down, in the shade, near a toilet etc. The job centre doesnt have any openings like that, I cant find anything for them but because this job theoretically exists they are off incapacity and on their bikes. The only people who will touch them are zero hour merchants who will sign up almost anybody because they want to cherry pick from a large, tame work pool. They then have a ‘job’ that will probably never call them, yes they can have the same contract with lots of other companies but they wont call either.
I’ve done lots of temping work when I was younger, it suited my itinerant lifestyle perfectly and I wouldnt propose that its is intrinsically coercive. But the benefit/job/political reality of the moment most certainly are.

On the 25th of April 2013 Lord Freud answered a question about those zero hour contracts and he said the following: I can confirm that jobseeker’s allowance claimants are not required to apply for zero hours contract vacancies.

So it looks like I was wrong @5, it’s not quit the jobs, it’s refuse to take them in the first place that you can do.

https://www.whatdotheyknow.com/request/zero_hours_contracts_2

@Tyler – why is Vince Cable supposedly targeting such exclusivity clauses in zero-hour contracts then if these don’t exist??? http://huff.to/1eplZVy for starters

18. Planeshift

“Every time you perceive exploitation you should ask yourself one question before trying to impose your will.

Is there any element of coercion involved?”

When the choice is ‘sign this contract’ or ‘starve because refusing to take this zero-hour contract will get you sanctioned and you will have no money to live on’ then there is clearly coercion involved, even if the coercion is imposed by a 3rd party”

And when the contract demands exclusivity or prevents an employee from looking for better conditions elsewhere……

19. Planeshift

@16 – DWP staff are on the whole nasty enough to threaten sanctions even when it isn’t official policy. However the above statement will help immensly for those who challenge such decisions.

What a total load of rubbish. The flexibility of the labour market is key for giving people opportunities to prove themselves as well as providing work in a more flexible capacity.

Speaking as someone who worked his backside to the bone as a freelance to show people I was a competent and able employee I find this type of sanctimonious garbage ridiculously stupid.

You of all people Natalie should appreciate the importance of flexibility in working as you were a journalist. I agree with Tim Worstall, lets ban the likes of you so that you can’t get to where you are or gain the experience you did. Although my personal opinion is that journalist to politician is a step down, if that is even possible.

RL @ 10:

“under a freelance contract a writer isn’t employed, has no obligation to hold him/herself available at short notice to work any specific hours with no correspondign obligation to provide worrk to do, is free to work for anyone else s/he sees fit”

But most zero-hours contracts are not like that either. I think they are a good thing, but I do not support ‘exclusive’ zero-hours contracts, if such things exist outside the fevered imagination of Vince Cable.

But most zero-hours contracts are not like that either.

Citation needed.

I am on a zero-hours contract myself (working in the public sector) and to be quite honest it suits me down to the ground. It has allowed me to set my own hours and availability (I am physically disabled and struggle with mental health issues) and my payslip is much clearer than those of my salaried colleagues, as it will show exactly what hours I have worked and am being paid for, as well as leave accumulation, etc (as much as being paid in arrears is a pain!). That said, I am in a better position than most in that my workplace is unionised, and due to working in the public sector I at least have some protection from random redundancies. I am also lucky in that I have been able to get hours working, and that I am not having to pay bills/rent/etc as I am living with my mother at the current time. I believe quite strongly that zero hours contracts can provide fleixibility to both employers and employees, but that they do equally provide employers with a very easy out when it comes to messing their employees around – giving them few hours, short notice as to when they are/not required, a lack of stability in their work hours. I do not think that banning them entirely is the right move, as in some sectors and areas they allow for much more flexibility than temporary and fixed-term contracts that would likely fill their place. I do agree however that their abuse is far too easy and there does need to be intervention of some kind to give people on zero hours contracts some level of assurance and stability.

24. Hours not to zero why

@10.
A freelance writer is basically someone who is self-employed and gets paid for work that someone else publishes. Comparing a freelance journalist / writer/ photographer with a fast-food worker on a zero hours contract with minimum wages is wrong.

1

Totally agree that state intervention stops the market from working, that’s why I’m f..king fed up of paying taxes to pay someone else’s tax credits and housing benefit when they are working.

26. Robin Levett

@steveb #25:

Totally agree that state intervention stops the market from working, that’s why I’m f..king fed up of paying taxes to pay someone else’s tax credits and housing benefit when they are working.

You’re directing your ire at the wrong target; the HB and tax credits to those in-work are in effect subsidies to their employers, who can thereby get away with paying lower wages.

27. Legal Flamework

@26.
I think that steveb is being slightly ironic.

Perhaps Natalie could helpfully confirm whether the Green Party or any branches thereof employs workers on an as and when basis. I am pretty sure there are quite a few

the HB and tax credits to those in-work are in effect subsidies to their employers, who can thereby get away with paying lower wages.

Hey, Robin.

Agreed!!!!

“the HB and tax credits to those in-work are in effect subsidies to their employers, who can thereby get away with paying lower wages.”

That’s an easy one to test, isn’t it? Abolish HB and tax credits and see if wages rise. If they do then you’re right. If they don’t then they’re not a subsidy to employers, they’re a subsidy to employees.

Who wants to try the experiment then?

31. Legal Flamework

@30.
Abolish benefits to workers on low wages and watch many more businesses go bankrupt.
If you think that it’s an easy one to test, you haven’t got a firm enough grip on the realities of life in Britain today.

30

I think the point being made is that tax credits and HB affect the market in the same way as a statutory minimum wage and any legal framework about zero hours.
@29 is either confused or h/she has forgotten what was said @1

I’m afraid that coercion is a particularly nebulous concept. Especially when the said coercion relied upon is the suggestion that it is coercive to work rather than be paid to not work.

A couple of weeks ago it seems most people had never heard of ‘zero hours contracts’ & now immediately the knee jerk left (as opposed to the thoughtful left) want them all banned.

The examples of companies calling someone in and then letting them go an hour later; & or banning them from taking any other employment are of course practises that are pernicious and should be banned.

But those examples probably do not make up the majority of zero hours contracts. I don’t know but the Greens & people like S**mas M*lne want them all banned without much thought.

For myself, after a period of unemployment I had two casual jobs (had never then heard of the phrase ‘zero hours contracts’), neither of which guaranteed any work but neither did they prevent me from having any other jobs. As it happens they both provided me with a reasonable amount of work – and one of them has led to me obtaining a permanent position in one of the organisations. I’m sure my experience is not an exceptionally rare one; so why should this be banned?

@34

It is precisely because of abuse of zero hours contracts by bad employers that they should be either banned or modified. The employer expects you to be available for work at all times. What would happen if you had other commitments? (Insert commitment of choice) what would happen if you showed them that it should really work both ways? P45 time?

@35 – It is clear you either did not read my comment or you are not prepared to take on board what I said.

Your comment that employers expect you to be available for work at all times is simply not true in all cases and possibly in most cases. It was certainly not true in my case & having a zero contract job led me to obtain a much needed permanent position which I may not otherwise have obtained.

As I said, action should be taken against bad employers – but that is not an argument for banning all zero hours contracts.

It does not help the left to be so knee jerk (& yet to hold the right in contempt when they act in a knee jerk way).

@36 Which sector did you work in?

@36
Which is why I said either banned OR modified. Good for you on it turning out to be positive. What i question in addition to bad employers abusing it, are your pre existing financial commitments like rent/mortgage, food, bills, council tax etc. all of which require a dependable source of income or a large nest egg for you to survive.

39. Robin Levett

@Tim Worstall #30:

That’s an easy one to test, isn’t it? Abolish HB and tax credits and see if wages rise. If they do then you’re right. If they don’t then they’re not a subsidy to employers, they’re a subsidy to employees.

Really? An interesting position.

If HB and tax credits are removed and wages don’t rise, then one of several things might have happened.

If the same employee remains on the same wage, and makes no move to seek alternative employment as soon as it becomes available, then it looks like a subsidy to employees.

If the same employee at first remains on the same wage, but then moves on to be replaced by a lower quality employee, then it looks like a subsidy to the employer, who is thereby employing a better grade of staff than he would have been able to employ in the absence of the benefits/credits.

In the extreme case, where an employee cannot afford the combination of rent and travel costs to get to work on the wages payable and actually lvie on the remainder, then the benefits/credits are quite definitely a subsidy to the employer. At what level of wages that turns into a subsidy to the employee (if at all) is the issue.

@Sandman
To my knowledge, no employees of the national Green Party are on zero hours contracts. I believe all of them are on fixed term contacts, some with flexible hours over the year (working more hours around election time and getting time off in lieu).
I don’t know every employee of every local branch (though the total number of employees paid by the Party is probably below 20, and I could name at least 10…), but the nature of our work is fixed and not flexible, so I am fairly confident none would be on zero hour contracts. I’m sure if any of our staff wanted a contract on a more fixed basis the membership would have something to say!


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