Zero-hours contracts

Gregory Campbell Excerpts

Tuesday 9th July 2013 Westminster Hall

[Mr Gregory Campbell (East Londonderry) (DUP)]

Does the hon. Gentleman agree that what should flow from the review by the Secretary of State for Business, Innovation and Skills is exactly what he is homing in on: a much more accurate estimate of how many people are affected? When we try to determine what needs to be done to help those people, we need to know how many are affected.

[Andy Sawford]

The hon. Gentleman is absolutely right and, if he will forgive me, I will come to that shortly.

It is well known that zero-hours contracts started in specific sectors of the economy, but are now widespread in all sectors, including in my constituency. Hundreds of constituents have contacted me about them. People tell me about waiting for a call or turning up at the workplace day after day, only to find that there is no work, yet their contracts make it difficult to find alternative employment or to claim jobseeker’s allowance. Like my hon. Friend the Member for Wigan, I have heard examples of people making child care arrangements or paying for transport to work and then waiting hours before being told they are not needed. Others have told me that because of zero-hours contracts they are unable to get a bank overdraft, a mortgage or car finance.

Of those on zero-hours contracts, 70% are for permanent jobs. How can it be right that someone in a permanent job is not given a permanent and proper contract of employment? More than 80% of people on zero-hours contracts are not looking for another job. They want to remain in employment, but they want that employment to be fair and secure.

A few weeks ago, the Resolution Foundation published an excellent report stating that those employed on zero-hours contracts receive lower gross weekly pay, and that workplaces utilising zero-hours contracts have a higher proportion of staff on low pay. In my constituency, zero-hours contracts and agency workers create a two-tier work force with permanent employees being paid better and having security of employment, but many others are paid incredibly low wages and are exploited from week to week.

The argument is that zero-hours contracts offer flexibility, but I would argue that if those contracts are justifiable, that flexibility should be beneficial to both employers and employees. In most cases, that is simply not so, particularly in low-wage sectors. Workers on those contracts have no control over the hours they work, the amount of money they earn each week or even the breaks they take. Reports show that care workers on zero-hours contracts are not paid for travel time or gaps between appointments. Unison published some excellent research on the impact on social care. I have a personal concern about that and I urge the Minister to look at it in detail. I would have said more about it if I had had more time.

Zero-hours contracts are just the tip of the iceberg. My hon. Friends have called for a review of the whole culture of work in this country, particularly as it has developed during the recession and in recent years as our economy has flatlined. Under-employment is generally too high in all its forms. Self-employment has been rising and bogus self-employment is a big issue. We have particular issues with Swedish derogation contracts that guarantee minimum hours of pay between agency assignments to exempt people from minimum pay.

I am pleased that the Minister met me and a delegation from Corby earlier this year to look at these issues. I am also pleased—I thank her for this—that she supported an initiative by the Employment Agency Standards inspectorate and Her Majesty’s Revenue and Customs to look at the issues in detail in Corby. The initiative was taken in my area, and I was not surprised to see the level of exploitation. When visiting agencies, they found more than 70 breaches of employment law, and HMRC put a figure of £100,000 on the money owed to local workers in my constituency. I urge the Minister to provide proper resources to HMRC’s minimum wage department and to support the vital role of the Employment Agency Standards inspectorate. It protects the most vulnerable people in my constituency and around the country. It should be better resourced, it should do more, and we should support it.

What do I want? I want more than an informal review. I want a proper formal review by the Government to look at the scale of zero-hours contracts, and a jobs market that identifies good practice. I want to explore the possibility of a ban. Zero-hours contracts have been banned in Luxembourg, Belgium and Lithuania. There are opportunities to develop new forms of flexible employment contracts and I urge the Minister to look at the work of the Union of Shop, Distributive and Allied Workers in this area.