ONS Estimate Close to 1.4m on Zero-hours Contracts

A report from the Office for National Statistics (ONS) has estimated that there are 1.4m UK workers employed on contracts that do not guarantee minimum hours. The ONS said that most of the contracts it identified were zero-hours, under which people are not guaranteed work from one week to the next. Previously, the ONS had estimated that were 582,935 workers employed on such contracts. This increased estimate is based on a survey of 5,000 employers. The new figure concurs with a recent estimate from the Chartered Institute of Personnel and Development that had estimated 1m people, or 3.1% of the workforce, were on such contracts.

According to the research, almost half of all firms in tourism, catering and food sectors, use “non-guaranteed hours contracts”, while around 13% of UK firms use zero-hours contracts, including one in five health and social work businesses. Workers under 25 years-of-age and those over 65 were more likely to be employed on a zero-hours basis. Two-thirds of those counted worked part-time. Female employees are thought to make up 55% of the total with zero-hours contracts.

Larger Employers More Likely to Use Contracts

The study also showed that larger employers were much likelier to use zero-hours contracts than smaller ones, with nearly half of businesses with 250 or more employees using the contracts. The findings came from a two-week survey of the labour market in late January and early February 2014. Contact the Employment Law team at IBB for advice on employment terms and conditions.

Last year, Business Secretary Vince Cable ruled out a complete ban on the contracts, because they offer employers “welcome flexibility”. However, Labour leader Ed Miliband responded by saying zero hours contracts had “spread like an epidemic” and said he planned to crack down on them. He added that workers with irregular shifts and pay should get a contract with fixed hours if they had worked regularly for the same employer for a year.

TUC Say 3 out of 5 People on Zero-hours Earn Less Than Minimum Wage

The news comes as a new study from the Trade Unions Congress (TUC) revealed that nearly three out of five people on a zero-hours contract outside London earned below the living wage of £7.65 an hour. The TUC found that the average hourly wage for a zero-hours worker was £8.83 an hour – a third less than the average £13.39 for staff on conventional contracts.

The union organisation added that it was concerned that many workers on these type of contracts were poorly paid, had no regular income and risked being exploited. Frances O’Grady, general secretary of the TUC, said: “Insecure work with no guarantee of regular paid hours is no longer confined to the fringes of the jobs market. It is worrying that so many young people are trapped on zero-hours contracts, which can hold back their careers and make it harder to pay off debts like student loans. The fact that these contracts have become the norm in tourism, catering and food will be a major concern for the millions of people employed in these industries”.

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