Zero-hours Contracts

Lisa Nandy Excerpts

Wednesday 16th October 2013 Commons Chamber

[Mr Umunna]

I completely agree with my hon. Friend, who, as it happens, intervenes just as I was about to talk about Merseyside. I was talking about collecting data on the number of zero-hours contracts being one thing and the evidence about their use being another. He will know that our hon. Friends the Members for Liverpool, Wavertree (Luciana Berger) and for Wirral South and our right hon. Friend the Member for Knowsley (Mr Howarth) produced an excellent report in June detailing the use of zero-hours contracts in the Liverpool area. In that report they told the story of a care worker, whom I have subsequently met and spoken to myself, as I mentioned earlier. She told me that she had to be available to visit clients at their homes at least six days a week, including evenings. Her rota could change in a flash. If visits were cancelled at late notice, she would often not be paid. If visits were added at the last minute, she would have to manage her child care commitments as she best could—a point raised by my hon. Friend the Member for Vale of Clwyd (Chris Ruane). That is the reality of life for people under these contracts.

In July, my hon. Friend the Member for Sunderland Central (Julie Elliott) held a Westminster Hall debate on this issue. Seventeen Opposition Members contributed to that debate, giving further testimony about people’s experiences on such contracts. In fact, my hon. Friend the Member for North Tyneside (Mrs Glindon)—I do not know whether she is here today—talked about how she had been employed on a zero-hours contract for two years in the retail sector. I note that not one Government Back Bencher spoke in that debate—save for the hon. Member for Mid Bedfordshire (Nadine Dorries), who was chairing it—but it is good to see a few more Government Members here today.

[Lisa Nandy (Wigan) (Lab)]

I was one of the Members who spoke in that debate. I raised the case of my constituent who had to leave her children locked in a car while she undertook home visits that were given to her at short notice under threat of not getting any work in future. In response to that debate, the Under-Secretary of State said that that was clearly “not right”, but since then we have seen absolutely nothing from the Government on how they will protect constituents such as mine and others, to whom my hon. Friend has referred. Does he agree that that is an absolute disgrace?

[Mr Umunna]

I do agree, and I read my hon. Friend’s speech from that debate. She talked about what the Government are doing. The Secretary of State said he was carrying out an informal review, but given that that consisted of just three officials spending part of their time “speaking informally” with stakeholders—as he told me in answer to a parliamentary question that I tabled on this issue—that is clearly insufficient. Therefore, in August, I and the shadow employment relations Minister, my hon. Friend the Member for Edinburgh South (Ian Murray), formally convened a summit, involving more than 20 different organisations representing employers, employees, legal experts and people employed on zero-hours contracts, to hear evidence and consider what action should be taken to clamp down on their exploitative use.

Two things arose from the evidence we heard and the consultations we have been carrying out. The consensus across all stakeholders and groups was that the exploitative use of such contracts is a problem—everybody agreed with that—particularly in the care sector. Those looking after some of the country’s most vulnerable people are themselves vulnerable under these contracts. Given that it is important for those whom they are looking after to have stable and continuous care from people with whom they are familiar, I cannot see how that state of affairs can have anything other than a detrimental effect on the quality of care received.

That state of affairs creates issues for many local authorities because of the way in which social care services are commissioned. Many of them will tell us that it is helping to drive the use of zero-hours contracts in the care sector. They say—some would say that this is not an excuse, but an explanation—that they are left with no option but to commission in that way because of the huge funding cuts they have been subjected to under this Government. I understand the challenges that local authorities face—I think we all do—but I urge them to follow the example of Southwark council, which is working with providers to eliminate the use of zero-hours contracts, particularly in the care sector.

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[Lisa Nandy (Wigan) (Lab)]

The hon. Member for Mid Norfolk (George Freeman) says that what the Government are doing is working and that the picture that the Opposition are painting does not resonate around the country. If he had listened to the speeches of the shadow Secretary of State and my hon. Friends in this debate and if he had heard the debate secured by my hon. Friend the Member for Sunderland Central (Julie Elliott) earlier this year, he would know that what the Government are doing is not working and that a picture of misery is unfolding in communities around the country, including in my own community in Wigan.

I do not intend to rehearse that picture, because the shadow Secretary of State described it eloquently. Suffice it to say that over the past 12 months, I have represented low-paid women who work in the care sector, which has been mentioned in this debate, countless young people, and adult men and women with families to support who are trapped on zero-hours contracts. Does it surprise the Minister that this week, the British Red Cross launched its first ever emergency appeal to feed families in the UK? The picture is unfolding, but we have a Government who will not take action to tackle the problem. Other hon. Members have spoken about the problems of low pay, insecurity in the workplace and deskilling.

I want the Minister to know that there is an anxiety that lives with people who are on zero-hours contracts, not just from week to week, but from day to day, about whether they will be able to feed their children, about whether they will be able to pick their kids up from school and about whether they will be able to arrange child care. That anxiety is corrosive and devastating. Alongside it, there is an indignity and humiliation that runs through people’s lives when they do not know whether they will be able to provide for their families, whether children or elderly relatives, or even themselves. People are being put in a situation in which they are powerless and that is wrong.

Although I welcome the Secretary of State’s tone and his promise to do something about the problem, too often in the years before I came to this place I heard consultations used as an excuse not to do something. I hope that is not the case with this consultation. In any case, there is an urgency to this problem because many families up and down the country simply cannot wait.

I will make a few brief points in the short time that I have remaining. First, there has been a lot of debate about whether zero-hours contracts should be banned outright and whether that is practical. It has been said that in some circumstances, zero-hours contracts are good for people. I do not really understand the argument about students. I do not understand why anybody would want a job in which they were guaranteed absolutely no work. I have never met anybody who wants that. I listened to the Minister carefully, but I still do not understand that point. There is clearly a difference between people who are trapped on zero-hours contracts and are desperate for more work but cannot get it, and people who value a bit of flexibility. The problem is that zero-hours contracts used to be a stepping-stone into better paid, more secure work. It is becoming increasingly clear that they are no longer a stepping-stone.

I was proud to stand alongside the Hovis workers in my constituency when they went on strike because 28 workers who had had full-time contracts were replaced by people on zero-hours contracts. They stood alongside one another and said that they would not accept two people doing the same job at different rates of pay and with different levels of security. That sort of two-tier work force is the thin end of the wedge and is bad for everyone. I was proud that Premier Foods accepted that argument, stepped in and reversed the situation. Premier Foods has gone from being a buzzword for bad employment to being a buzzword for how to take action to become a good employer. I am proud that that happened in my constituency.

[Ian Lavery]

Is it not the case that a number of Hovis workers were made redundant and that other people were taken on on zero-hours contracts to save the company money?

[Lisa Nandy]

Indeed. I am grateful to all the hon. Members who supported those workers and me. That situation reflects something that is happening in their constituencies as well.

The Hovis strike was not just about zero-hours contracts. As my hon. Friends have made clear, there is a growing casualisation of the work force in this country that is corrosive and is deeply worrying to all of us. As the shadow Secretary of State said, we have one of the most deregulated labour markets in Europe. Many more people are now in temporary work and low-paid jobs. Clamping down on zero-hours contracts and their exploitation is just one part of what we must do. I hope that the Minister understands that.

This problem affects young people disproportionately. We know from history that when young people are trapped in situations in which they cannot advance themselves or their families, it causes hopelessness, despair and anger, and the associated problems that go with those feelings. We owe young people better than that. I would like to hear what the Minister proposes to do urgently for those young people.

What we are saying is not anti-business. We have heard much about the employers who are using the flexibility that zero-hours contracts provide to exploit the work force, but there are many employers who are not doing that. The shadow Secretary of State gave the example of Asda, which is taking a stand against such treatment of the work force. It is essential that the UK leads the way in showing that things can be levelled up, not levelled down, for the benefit of everybody. Otherwise, employers such as Asda who are making decent choices, doing the right thing and investing in their communities will be at a disadvantage and we will be tilting the playing field.

[Caroline Dinenage (Gosport) (Con)]

Will the hon. Lady give way?

[Lisa Nandy]

I will not, I am afraid, because many of my hon. Friends have sat through this debate and are desperate to speak.

As many hon. Members have said, this problem affects entire sectors. We should be very concerned about that because, as I have said, such contracts are not a stepping-stone. I am particularly worried about the care sector and home help. This problem affects the low-paid people—mainly women—who work in that sector. It affects their children, their parents and their whole family. It also affects us, because if we value that profession so little that we allow this practice to be used across the country, we allow people to be given no money for travel time between appointments and we allow packed rotas that mean that older people get 15 minutes to have all their care needs met, what does that mean for our parents, our grandparents and our neighbours? I hope that the Minister will listen to the voices of people around this country who are devastated by what they are seeing.

Finally, the Secretary of State spoke a lot about getting redress and taking on employers, and about a code of conduct. In truth, however, it is incredibly difficult for someone who is being threatened with no more work to take action. Have we learned nothing from the blacklisting scandals that my hon. Friend the Member for Edinburgh South (Ian Murray) has done so much to uncover and condemn? Ministers say that we want to give people the ability to take action on that issue, so why are they restricting access to legal advice and hiking up employment tribunal fees?

It strikes me that the Government are frightened of challenge, and they are standing together with their friends in the business community to stop people who have everything to lose being able to take action. Whatever the Government do, the Minister must understand that rights are no good without the means to enforce them, and we need concrete action to ensure they can be enforced.

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[The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)]

May I thank the many Members who have spoken in this debate, which has been good natured? There have been a number of passionate speeches. Those who have contributed fall into two groups. There are clearly those who want to squeeze out flexible-hour contracts altogether: the hon. Members for Halifax (Mrs Riordan), for East Antrim (Sammy Wilson), for Sunderland Central (Julie Elliott), for Wigan (Lisa Nandy) and for Wansbeck (Ian Lavery). There are others who have taken a more nuanced approach. It was my hon. Friend the Member for Hexham (Guy Opperman) who said that we needed to be neither for nor against flexible-hours contracts, but that we needed to deal with the exploitation. The hon. Member for Newcastle-under-Lyme (Paul Farrelly) welcomed the consultation that we are planning, but asked, quite fairly, whether it would encompass the wider issues of shorter hours and agency working. I pay tribute to the hon. Member for Wirral South (Alison McGovern) for the work that she has done on this matter, and she said that she was willing to engage with the Government’s consultation. She has accepted that the sample that she has produced so far is relatively limited, but we are very happy to look at her work, and I welcome her offer to engage with the Government on it.

My hon. Friend the Member for Burnley (Gordon Birtwistle) made some strong points on the issue of exclusivity. I can absolutely give him the undertaking that that will be central to our consultation. He also made the point convincingly that we should not unduly restrict choice where that choice is being freely entered into.

My hon. Friend the Member for Mid Norfolk (George Freeman) spoke of the importance of retaining flexibility in the modern business environment and adduced powerful support for flexible-hour contracts from a range of business and personnel organisations. My hon. Friend the Member for Braintree (Mr Newmark) was the only Member who spoke in the debate to point to the latest employment and unemployment figures, and I am rather surprised that no Opposition Member today was able to recognise the continuing increase in the number of people working, whether in the north-east or the south-east. It is a shame that more Members did not give due credit for the increase in employment.

[Lisa Nandy]

I do not recognise anything of what the Minister has said so far. If he had listened to the debate, perhaps he would be in a better position to respond to some of the very important points made by my hon. Friends and by a few Members on the other side of the House.

[Michael Fallon]

I have been here throughout the debate and have listened to every speech since about a quarter to one this afternoon. I certainly listened to the hon. Lady’s speech, which was a very good one. I am simply pointing out the difference between those hon. Members who want to get rid of flexible-hours contracts altogether, and others who can see their value and want to preserve the choice so that those who are happy to choose them are able to do so.

My hon. Friend the Member for Dover (Charlie Elphicke) drew attention to the issue of eligibility for mortgages and rental tenancies for those who are on such contracts. It is important that we look at that aspect. The hon. Member for Edinburgh East (Sheila Gilmore) raised the issue of the application of flexible-hours contracts in the care industry, and spoke about the number of such services that have been contracted out. However, a great number of councils up and down the country, and not just subcontracted firms, are using flexible-hour contracts: Doncaster, Southwark and Liverpool, for example. The issue is not simply one for privatised contracted labour.