What’s the latest on Zero Hours Contracts?

 

According to a Zero-Hours research report published by the CIPD this month, there are some interesting statistics from 2021 research taken during and towards the end of the 2021 Covid pandemic period.

“Zero-Hours Contracts – evolution and current status” is a report* written and prepared by Mark Beatson of the CIPD and we highlight some of the main aspects below:

• Attitudes towards zero-hours contracts have continued to be ‘normally a bad thing’ by over 60% of respondents

• Almost a fifth (18%) of employers made some use of zero-hours contracts, however, this was less than in 2015 [25%] and 2013 [23%]. In 2021, more than three-quarters of employers researched (77%) did not use them. The remaining 5% did not know if they used them, mainly larger employers.

• In line with previous surveys, the hospitality and entertainment industries and the voluntary sector stood out for their volume of use of zero-hours contracts, with 49% in the hospitality and entertainment sector adopting them and 24% in the voluntary sector.

  Contrastingly, only 5% of employers in the finance and business sectors relied on zero hours contracts and 8% for employers operating in public administration.

• From a 2021 segment of 132 employers who employed two or more people and made use of zero hours contracts, CIPD estimated 3million workers were on zero-hours contracts in the labour market.

 

Almost two-thirds (65%) of employers typically employed zero-hours contract workers for up to 30 hours a week – hours that usually would be regarded as part-time. Almost a fifth of employers didn’t know the typical working week of their zero-hours contract workforce.

 

Workers on zero-hours contracts:

4% worked more than 40 hours

15% worked 31-40 hrs

16% worked 21-30 hours

15% worked 16-20 hours

15% worked 11-15 hours

9% 6-10 hours

9% up to 5 hours

 

Reasons for using zero-hour contracts:

 

Overwhelmingly, 64% of employers cited the need to ‘manage fluctuations in demand’ as the main reason for using zero-hour contracts, 46% ‘to provide flexibility for the individual’, 35% ‘to provide coverage for staff absences and 21% ‘to retain workers rather than make them redundant’.

The latter statistic of 21% possibly relating to the people who had to come off the government’s Coronavirus Furlough Scheme, making it more attractive for employers to place them on zero-hours contracts rather than offering a permanent employment contract. This makes sense as ‘fluctuations in demand’ was also high.

 

Types of workers affected:

Young people – students especially – and older people were most likely to have zero-hours contracts. Zero-hours contracts were most common in the hospitality industry (accommodation and food), in arts, entertainment and recreation, in routine, low-skill occupations and in small workplaces.

Over half of employees with zero-hours contracts had been with their employer for under two years – the length of service required for protection from unfair dismissal. Even so, almost a fifth of employees with zero-hours contracts said they had been with their current employer for at least five years.

Hours worked:

Over two-thirds (70%) of zero-hours contract employees worked part-time hours, whereas over three-quarters (78%) of employees without a zero-hours contract worked full-time hours. As a result, average hours worked with zero-hours contracts were much lower than for employees without zero-hours contracts.

Satinder Kaur, Trainee Solicitor
Employment Team, Lawson-West Solicitors

Satinder Kaur adds:

“This study confirms the general attitude that zero-hours contracts are widely considered to be a negative way of working, but also assumes that workers do not want to work under shorter-hour or non-permanent contracts. I have experienced that a number of people do want the flexibility that a zero-hours contract can bring – these kinds of contracts only really become problematic for employees when they require job certainty above flexibility and, at that point, the employer can come across badly if they are not able to rise to the challenge of providing job certainty, if their focus is on prioritising operational necessities or profit.”

Lawson-West’s team of employment solicitors is experienced with all types of employment contract and can advise on zero-hours contracts for both employees and employers; helping to ensure a zero-hours contract protects an employee’s interests and helping to ensure protection for employers seeking to manage fluctuating demands in workforce.

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*Source:  [CIPD. (2022) Zero-hours contracts: evolution and current status. London: Chartered Institute of Personnel and Development.]

Personnel Today’s view of the report findings:  ‘Zero-hours contract benefits ‘can outweigh negatives for workers’.

 

 

 

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