Report finds 3 in 4 on zero hours earn ‘below living wage’

Most workers on zero hours contracts earn less than the living wage, fuelling fears of poor pay and exploitation of employees, according to a new report.

A study by the TUC found that almost three out of five people employed on a zero hours contract outside London were paid below the living wage of £7.65 an hour, rising to three out of four in London, where the figure is set at £8.80.

The research was published ahead of new figures being published by the Office for National Statistics on how many are employed on zero hours contracts, under which they don’t know if they are guaranteed work from one week to the next.

The subject has become hugely controversial, with unions calling for them to be scrapped, while Labour has pledged to stop abuses of the system if they win the next election.

The TUC said it was concerned that many workers on these type of contracts were poorly paid, had no regular income and risked being exploited.

Its study showed that the average hourly wage for a worker on a zero hours contract was £8.83, a third less than for staff on permanent contracts.

The union organisation said there were increasing numbers of workers “trapped” on zero hours contracts, even as the economy improves.

TUC general secretary Frances O’Grady said: “Zero hours contracts have always been around but they were once confined to tiny areas of the labour market, and seen as a way to keep staff on even when work dried up.

“But casualised work is becoming more popular, even as the economy recovers. Employers like to argue that zero hours contracts offer flexibility but for many workers they mean poverty pay and no way of knowing how often they’ll be working from one week to the next.

“Replacing vulnerable zero hours contracts with more secure employment will be a key test of whether this recovery is reaching hard-pressed workers.

“In the meantime, the Government should legislate to prevent the abuse of zero hours contracts by bad employers.”