Zero-hours Contracts

Debate between Chuka Umunna and Chris Ruane

Wednesday 16th October 2013 Commons Chamber

[Mr Umunna]

I will come to that point very shortly.

[Chris Ruane (Vale of Clwyd) (Lab)]

My hon. Friend referred to the impact on families. Will he expand on that? What is the impact of zero-hours contracts on a mother’s or father’s ability to plan picking their children up from school in a week’s time, to plan family holidays or Christmas or to plan whether they can afford a mortgage?

[Mr Umunna]

I will come to that point shortly and tell the House the story of a zero-hours contract worker I met recently in exactly that position.

The Government and policy makers can acknowledge the problem, but the question is this: at a time when people feel more insecure than ever, will they just heap further insecurity on them, or will they act to do something about the situation? What have the Government done? First, we have their failed economic plan. Thanks to the policies they have pursued, unemployment and underemployment remain stubbornly high, with almost 2.5 million people still out of work, including, tragically, almost 1 million young people. I do not think that that is cause for celebration. It is welcome that growth has returned, but for all the talk of rebalancing, in the fourth year of the Government, that rebalancing looks as elusive as ever. We just have to look at the statistics that came out this morning. In today’s employment figures, of course it was good to see unemployment fall in parts of our country, but in many regions—London, the north-west, the east midlands and the south-west—it increased.

--- Later in debate ---

[Chris Ruane]

My hon. Friend has mentioned the use of zero-hours contracts in the Palace of Westminster. I have contacted the Speaker about this matter, and I commend him for his positive response. The problem also exists across the way in Lambeth palace, and I have tabled parliamentary questions to the Church Commissioners about it. The number of zero-hours contracts in Lambeth palace has gone up from five in 2008 to 34 today. Their proliferation is rampant around the country. The problem is out there, and without proper monitoring it will continue to progress. I congratulate my hon. Friend the shadow Secretary of State on securing this debate, which is shining a torch into those dark places and establishing that this is a big political issue that affects millions of poor people out there.

[Mr Umunna]

I completely agree with my hon. Friend.

In answer to the question of how we should deal with the problem, our motion proposes four measures that we hope the Government can support or, at least, commit to properly consult on. First, we would ban employers from insisting that zero-hours workers be available to work—be on call, effectively—even when there was no guarantee of work to give them. Secondly, we would stop zero-hours contracts that required workers to work exclusively for that employer. The Secretary of State has talked about that aspect of the matter before. Thirdly, we would prevent the misuse of such contracts when employees were, in practice, regularly working a number of hours a week. We would ensure that they became entitled to a contract that reflected the reality of their regular hours. Finally, alongside those measures, we would introduce a code of practice for the use of the contracts that would ensure, for example, that an employee recruited on a zero-hours contract would know that those were their terms of employment. We have announced the appointment of the former head of human resources at Morrisons, Norman Pickavance, to lead an independent consultation on how we could best implement those measures.

In conclusion, I want to say something about where this will fit with the future of our economy. We need to reform our economy so that it is fit for purpose, and so that it delivers better and fairer outcomes for people. We consistently hear from some people that the best way to do that is further to liberalise our labour market, which is already the third most liberal labour market in the OECD. That is why they recoil from taking action on exploitative zero-hours contracts, but that approach amounts to a global race to the bottom in which we seek to compete with China, India and the other emerging economies by screwing down the pay and terms and conditions of working people in the name of growth.

That is not the way in which we should be competing, because it will not deliver better outcomes for the people we represent. We will deliver better outcomes for them, ultimately, by growing those industries that can provide more of the better paid, secure jobs that they want. Of course that means promoting innovation and ensuring that our people have the skills to do those jobs. That is why I am always banging on about the need for an industrial strategy. We must act to protect those who continue to work in low-income, insecure jobs in the less internationally competitive sectors. Heaping insecurity on them is not the right thing to do.