Tag Archives: GenY

Dickensian: Zero-hours contracts

Zero hour contracts

Zero-hours contracts

I’ve just had two astonishing conversations with two young people. This wasn’t related to wild nights out or any inappropriate behaviour, but their employment conditions.

Both are working on zero-hours contracts.

For the uninitiated zero-hours contracts are apparently a particularly British phenomenon. A  bit like Christmas pudding and red double-decker buses, just infinitely less wholesome

They are understood to be an employment contract between an employer and a worker, during which the employer is not obliged to provide the worker with any minimum working hours, and the worker in turn is not obliged to accept any of the hours offered.

Increasingly, many companies  across all sectors  are taking on staff on ‘zero-hours’ contracts.  These contracts effectively provide employers with a pool of  employees who are ‘on-call’ and can be used when the need arises.

At one end of the spectrum  the Chartered Institute of Personnel and Development suggest that they provide  great possibilities for  individuals to strike a work life balance or supplement fixed incomes on an ad hoc basis. Students and pensioners particularly value this arrangement .

On the other hand,  they are viewed as yet another component in the exploitation formula with rife mal-practise reported.

Risk reduction

Zero-hours contracts are becoming increasingly popular as a way of tapping into a pool of labour to meet operational requirements and reducing recruitment and employee costs. They are also a way of minimising risk connected with workforce planning or it would seem planning of any kind really.

Research indicates that those on zero-hours contracts earn less than those on staff or on fixed-hours contracts,  with no rights to sick pay  and holiday pay  often refused.  They are also more widespread than is generally thought and increasing used for  hiring young people in the 18-24 demographic.  They are fast becoming a way of circumventing corporate statutory obligations. Although officially associated mainly with unskilled labour, anecdotal evidence would suggest that this is not consistently the case.

Victorian

There is something very Dickensian about this system with workers lining up, albeit at the end of their mobile phone and a few being selected,  with the rest remaining un-contacted.  Peter is on a zero- hours contract with a London  based call centre company.  Earlier this month he paid for travel to his place of work only to be told that there had been a miscommunication between the account manager and the client and there was no work until further notice. The contacted group was sent home after thirty minutes without pay.

Peter an arts graduate told me ” The choice to refuse work  in reality doesn’t exist.  If you refuse you are labelled as inflexible. Very often the management is poor with minimal training given. There is no accountability. The manager screws up and the workforce has their shifts cancelled.  Communication is erratic and anyone who speaks up is regarded as a ” trouble-maker. ”

He continued  “It’s made clear when you are hired any employment rights are restricted and there is  no job security until anyone has been employed for two years. But usually any long-termers are terminated just before they reach  the two years service point. Very often employees are given spurious official warnings for the slightest contravention to create an HR paper trail to “justify” a termination. One colleague was five minutes late after his train broke down and was given a written warning even though he sent an explanatory text to say  why he had been held up”

It is generally agreed that zero-hours contracts are effectively becoming licences for poor management and a pathway for potential employment abuse.

Kara with a degree in Psychology,  has been working on zero-hours contracts in the hospitality and retail sector. She explained “with no job security it is impossible to plan or save. My daily worry is how I am going to pay my most basic bills. Many of my friends are forced to live with their parents even though they are in their mid 20s. I work two jobs to make sure I have enough money to eat and cover my rent.  I’m 26 with a degree and it seems crazy that I can’t get a job to keep myself above the poverty line. When I do go for interviews for “proper jobs” I am told I don’t have the right experience. It’s like being on a treadmill ” 

Although the U.K. government plans to outlaw any restrictions  on employees on zero-hours contracts working elsewhere,  they are still allowing the concept to remain.

So although much is written about leadership and employees being valued the reality is that those leadership priorities are often disregarded to increase shareholder value and benefit business balance sheets regardless of the longer term implications.

Short term solutions

These are very short term solutions which will come back to haunt us. Together with it’s bed fellow unpaid internships  with zero-hours contracts we are seeing a reverse trend to Victorian era style employment practises which has a multi-generation impact.  Nicknamed KIPPERs (“kids in parents’ pockets eroding retirement savings”) in the U.K., we have a huge demographic who are spending what should be a formative period acquiring key professional skills,  in employment and economic limbo. This in turn is impacting their parents who continue to be forced to support them.

What will we see next? The return of the truck shop?