Employment Rights

Debate between Lord Harrington of Watford and Andy Sawford

Thursday 12th September 2013 Commons Chamber

[Andy Sawford (Corby) (Lab/Co-op)]

I thank the Backbench Business Committee for scheduling time for this important debate. It is a particular pleasure to follow my right hon. Friend the Member for Oldham West and Royton (Mr Meacher), who set out many important issues, as well as other colleagues who highlighted some of the issues that I want to speak about.

The living standards crisis that people are facing is not only an issue of pay and the rising cost of goods, but of security. People now feel less secure and more pressured at work than at any time in the past 20 years, according to the latest UK skills and employment survey. Our country already has the third most liberal labour market in the OECD, but since taking office the coalition has shown real determination to undermine people’s protections at work, making it easier to fire people but not easier to hire people. In effect, they have heaped further insecurity on working people. I shall speak today about two aspects of that insecure working that I have campaigned on before and since my election to the House—the rise in the use of zero-hours contracts and the use of employment agencies.

Zero-hours employment is now widespread in many sectors of the economy, and it is especially prevalent in areas of higher unemployment, where the lowest-paid and most vulnerable workers in Britain exist without knowing when the next payday might come. That is certainly the case in my constituency. People on zero-hours contracts tell me about waiting for a call or turning up to the workplace day after day, only to find there is no work, but their contracts make it difficult to find alternative employment or to claim jobseeker’s allowance. I have heard examples of people making child care arrangements or paying for transport to work and then waiting for hours before being told that they are not needed. Other people have told me that because of zero-hours contracts they are unable to get a bank overdraft, a mortgage or car finance. For those people who are getting regular work on a zero-hours contract, they know that it could end at a moment’s notice and they could be left without sick or holiday pay.

In an exchange with me over the summer, the Office for National Statistics has confirmed that later this year it will start asking about zero-hours employment in its regular surveys. Everyone recognises that its estimate of 250,000 people on such contracts is well wide of the mark. We know that people working in McDonald’s, Burger King, JD Wetherspoon, Sports Direct, Cineworld and Boots are on such contracts, as well as 307,000 workers in the care system, according to the Government’s own figures. We know that the NHS has almost 100,000 workers on zero-hours contracts, which the BMA has described as a real risk to patient safety.

I fully accept that for some people casual contracts can work, such as the students who work as lifeguards at my local swimming pool, or the retained firefighter who also works occasionally for the Co-operative Funeral Service. If casual contracts are fair, reciprocal and appropriate, they can have a place in the labour market. But there is a clear distinction between such employment and the way in which millions are now being exploited on zero-hours contracts. It is important that we draw the distinction, and there are three main practices that must stop.

The first is requiring an employee to be available for work when no work is guaranteed. The second is requiring an employee to sign an exclusive contract when no work is guaranteed, so they cannot take work elsewhere, and the third is when employees are working regular hours over a sustained period but their contract does not reflect that. I have introduced a private Member’s Bill to address the issues with zero-hours contracts, and I will set out how I hope we can give effect to changes that would protect people in such circumstances.

[Richard Harrington]

Given the hon. Gentleman’s views on zero-hours contracts, will he condemn the Labour councils mentioned by the hon. Member for Eastbourne (Stephen Lloyd), who have so many employees on zero-hours contracts?

[Andy Sawford]

Corby borough council employs some people as lifeguards in the local swimming pool on casual contracts that are not exclusive and do not require people to attend for work or else breach the contract. Those are clearly casual employment. Any council, of whatever stripe, that uses such contracts must do so in a way that is fair and reciprocal. I urge Labour councils to give a lead in that, and they are doing so. They are looking at the care sector, for example, where insecure employment has a real impact on the quality of care, as well as on the employees, to address the issue. I applaud them for that and think that the Conservatives’ attempts to use it as a smokescreen is unhelpful in such an important debate.

I urge companies not to wait for 2015, when my right hon. Friend the Leader of the Opposition has promised to take clear action on this. That is why I met McDonald’s and talked about employment in its business. This week I also met the managing director of Starbucks, and I have talked to employers across my constituency and to councils about care workers. I want them to take action now, because that would be good for their reputation and for retaining a motivated, loyal and trained work force. I am pleased that companies such as Tesco, Asda and Morrisons—whose human resources director will lead a review of this issue for the Opposition—are already showing that such contracts are not necessary for a successful business.

The issue of temporary workers working through employment agencies is a particular concern in Corby and east Northamptonshire. For historic reasons, we have a large proportion of jobs through employment agencies, with a disproportionately large number of agencies operating in the town. Rogue agencies that do not adhere to the basic framework of legislation to protect workers are a particular problem.

With great regret, I read recently that the Government intend to abolish the employment agency standards inspectorate, which plays an incredibly important role. I was pleased that the Minister agreed that it could undertake inspections in my constituency. It found more than 70 separate breaches of the law, and also found, working with HMRC, £100,000 owing to local workers because of minimum wage issues. My constituent, Irene Hamilton, said:

“I am so glad I never have to go to work for an agency now that I am retired…I felt that I was invisible…Don’t be sick, don’t go on holiday, no family or funeral problems are expected of agency workers. It was soul destroying.”

Her example is typical of so many people in my constituency.

There are a wide range of issues. The use of the Swedish derogation, a giant loophole that must be addressed, has been mentioned. I am working locally to implement a code of practice. We must get much better at enforcement. I have also introduced a private Member’s Bill to extend the powers of the Gangmasters Licensing Authority to all sectors of the economy—not to license, necessarily, in all sectors of the economy, but to be able to enforce the law in all sectors of the economy. The abuses are widespread, and I hope to have more time on another occasion to speak about some of the issues.