Zero-hours contracts

Alex Cunningham Excerpts

Tuesday 9th July 2013 Westminster Hall

[Alex Cunningham (Stockton North) (Lab)]

It is a pleasure to serve under your chairmanship, Ms Dorries. I congratulate my fellow north-east England MP, my hon. Friend the Member for Sunderland Central (Julie Elliott), on securing this long overdue debate.

At a time when unemployment is persistently high—and nowhere more so than in north-east England—the Government still refuse to listen to Opposition calls for a compulsory jobs guarantee. The same Government are content to massage the unemployment and employment figures in whatever way possible, to give a very different impression of the challenges facing countless people. It is therefore all the more fitting that we are here today to discuss contracts that must be contributing in a substantial way to in-work poverty.

We all know that the bulk of jobs created under the Tory-Lib Dem Government are part-time and low paid, leaving families and individuals struggling to cope, while the Prime Minister boasts of the opportunities he has created for them. I am not too surprised that there is not a Conservative in the Chamber, and that the Conservatives have left a Liberal Democrat Minister and Parliamentary Private Secretary to answer today. However, the Prime Minister cannot throw a veil over the reality of worklessness and minimal or zero-hours contracts, whose numbers are growing daily, and which are often used as a mechanism to screw down wages, screw down people and screw down our country.

We need to take action to make sure that unscrupulous employers cannot take advantage of workers in what is already a tough jobs market, and to ensure fairness in the workplace and promote real job creation—of jobs that pay well while assuring security in the workplace and shared prosperity. There is no doubt that employers seek increasingly flexible staffing structures and many are adopting zero-hours contract arrangements to avoid agency fees and to sidestep the Agency Workers Regulations 2010.

The use of zero-hours contracts is, as many hon. Members have said, widespread across both public and private sectors. A survey by the Industrial Relations Service suggests that 23% of employers now include zero hours as an employment option. In public services, the care sector has been particularly vulnerable, with more and more such contracts. The situation is likely to worsen further under the NHS’s new commissioning arrangements, which do not guarantee providers with work, so that they in turn do not guarantee work to staff. That alarming trend has even spread into areas such as cardiac services and psychiatric therapy.

Some may say the employers cannot be blamed, but I do not care who is blamed: no one should have to suffer the indignity of a contract under which it is possible for no work at all to be provided. In figures from the national minimum dataset for social care, it is estimated that 150,000 domiciliary care workers alone are employed on zero-hours contracts. Statistics released last week by the Minister of State, Department of Health, the hon. Member for North Norfolk (Norman Lamb) suggest that 307,000 people in the social care sector, or 20% of the work force, are employed in that way. Within the North Tees and Hartlepool NHS foundation trust alone—that is the one that serves my area—there were 786 zero- hours or casual contracts in operation in April 2013, 682 of which were for clinical positions. I acknowledge that some of those may cover people with other roles, elsewhere and within the trust, but I still think it is a scandal that we are trying to provide care on that basis—even if it does afford the employer flexibility to fill gaps.

Elsewhere, in the worst scenarios, zero-hours contracts can result in some of the most vulnerable people—who care for other vulnerable people—being unfairly treated owing to a lack of proper protections. Recent work by the Resolution Foundation indicates that those who are employed on zero-hours contracts work fewer hours than those who are not, averaging 21 hours per week compared to 32 hours per week; and there is a gap of about £6 an hour, on average, between those who are on zero-hours contracts and those who are not. Not only does that put employees completely at the mercy of employers, presenting the opportunity for rogue employers to exploit workers; it also removes any semblance of the stability and certainty that must be central to rebuilding our economy and people’s lives.

[Robert Flello]

I want to pick my hon. Friend up on a fact. He mentioned the difference in the number of hours, but I suggest there is not a difference. It is just that the people who are not on zero hours are getting those hours paid.

[Alex Cunningham]

Indeed. That is very much the case. It just worries me that although the average working week for people on those contracts may be 21 hours, for many people they mean zero.

Power imbalances operate in many workplaces, and workers who need a minimum number of hours a week to remain financially secure often find the uncertainty of working fluctuating numbers of hours tremendously tough. Similarly, some find their contractual situation becomes a device through which loyalty is used to determine future work load. In essence, the allocation of a favourable number of hours becomes reliant on such factors as previous flexibility and a willingness to accept all hours offered, as well as fickle aspects such as cordial relationships with line managers. Regardless of how good a worker someone is, if their face does not fit, their zero-based contract may mean just that—zero. The repercussions that are used to sanction employees who are deemed to have stepped out of line should be better regulated to ensure fairness in the workplace. It is time that safeguards against exploitation were re-examined and bolstered to achieve a balance of power.

Before the Working Time Regulations 1998 and the National Minimum Wage Regulations 1999, zero-hours contracts were often exploited to clock off workers during quiet periods, while retaining them on site to allow for a rapid return to work. That down time was largely unpaid, and was grossly unfair to employees. Under the previous Labour Government, action was taken to protect the interests of workers and stop that abuse. We cannot and must not go backwards on these issues. We need a Government who will take more action now. If we must have such things as zero-hours contracts, we need to ensure that they are properly regulated to maintain an individual’s freedom to contract on favourable terms, with some form of guarantee that they have a job worthy of the name.