Think-tank: give zero-hours contract workers fixed-hours employment

Workers on controversial zero-hours contracts should get a legal right to a fixed-hours arrangement after 12 months, a think-tank has concluded.

The Resolution Foundation’s suggestion came as part of a raft of proposals to reform zero-hours contracts, which have been a topic of mounting political debate as they do not guarantee employees fixed hours nor fixed benefits.

The report makes a number of recommendations that could provide the basis for government action as business secretary Vince Cable has promised to review the growing use of zero-hours contracts and Labour has pledged to give workers greater protection.

• To ensure that individuals who are hired on a zero-hours contract are fully aware of the nature of their contract and associated entitlements, everyone employed on a zero-hours contract should receive a statement of employment particulars. This extends the current right to workers, not just employees.
• To address significant knowledge gaps among many employers about their obligations under zero-hours contracts, Acas should work with unions and employer representatives to develop a good practice guide. This would start off as non-statutory guidance but could be revised if improvements were not forthcoming.
• To increase the likelihood that employers who abuse zero-hours contracts are identified and pursued, increased funding and better sharing of information between enforcement agencies should be made available. This would enable more proactive enforcement action rather than simply following up on complaints.
• To ensure that zero-hours contracts offer flexibility to workers as well as employers, a ban on the use of exclusivity clauses in zero-hours contracts should be introduced. This would end the practice whereby employers do not offer any guaranteed hours and at the same time prohibit their workers from taking jobs elsewhere.  

To prevent zero-hours contracts being used to erode employee rights rather than to manage short term fluctuations in demand, staff on zero-hours contracts should have the right to a fixed hours contract after 12 months of employment, provided their weekly pattern of hours worked is relatively consistent. The decision of whether to switch contracts would remain with the worker.

While these recommendations would apply across the economy, there are worries that in specific sectors of the economy, use of zero-hours contracts is more problematic. Much of this relates to publicly-funded services, with social care being particularly troubling. There are limits to what can be achieved without greater funding but the following changes to local authority commissioning would help zero-hours workers:

• There should be a shift from time and task to outcomes-based commissioning to give providers greater flexibility in how they deploy their staff and to improve incentives to focus on the quality of care provided.
• In light of the Public Services Act and EU Procurement Directive, commissioners are expected to consider the social value of procurement decisions and not focus exclusively on value for money. Workforce terms and conditions should be included within definitions of social value given the local economic significance of improving pay and income security.
• Local authorities should play a wider role as market managers to support more sustainable local care markets. If providers are able to consolidate activity within a local area, they are better able to offer workers guaranteed hours rather than a zero-hours contract.

To download the report, visit: http://www.resolutionfoundation.org/publications/zeroing/