Zero-hours Contracts

Lord Monks Excerpts

Wednesday 29th June 2016 Lords Chamber

[Lord Monks (Lab)]

My Lords, I thank my noble friend Lady Quin for bringing this issue of zero-hours contracts once again to the attention of the House. The increasing use of these contracts is rather symptomatic of some wider trends whereby employers tend to shift risk away from themselves and on to the shoulders of their workers. Other symptoms include the rise and rise of agency work and of self-employment, some of it bogus. In different fields, the flight from final salary pension schemes and the increased reliance on publicly and individually funded training schemes point in the same direction in terms of this transfer of risk. I am not speaking of all employers of course, but the better ones are being undermined by the worse ones in this area. More and more of our citizens are working under contracts which are too often, in the words of Thomas Hobbes, “nasty, brutish and short”.

The even deeper truth is that labour is coming off second best in the battle with globalised capital. Our share—the workers’ share—of national income has retreated, except of course for those at the very top of many of our big companies. There are profound consequences in all this. Topically, one of them was the revolt last Thursday against the status quo, including the EU, in some of the old industrial areas of this country. We saw and were reminded that whole towns have lost their raison d’être, as staple industries disappear to be replaced by jobs at lower rates on wobbly contracts. Migrants proved to be a convenient scapegoat for the dissatisfaction that has been bred because of these factors in these areas.

Globalisation is not working for as many people as it should. Big business, especially since 2008, has been rather bad political news, with stories about widespread tax evasion, excessive directors’ pay, insecure contracts and broken pension promises. These have taken a heavy toll on the reputation of business and of our current model. We can point to statistics about how global markets stimulate growth and prosperity, but these are abstract to those on insecure, low-paid contracts and do not dissuade them from pouring into the polling booths with the nationalists and nostalgics of last Thursday, who turned out in force to register their dissatisfaction with the status quo.

I fear that those who voted that way have self-harmed, but many will tell you, “What the hell, I have nothing to lose”. In 2008, politics bailed out business; now it must confront the excesses of our system. In addition to the national living wage and the apprenticeship levy, we need a nationwide effort to promote recruitment and training so that local labour gets a chance at the jobs that are available. We need the minimum rules on zero-hours contracts and casual working to which my noble friend Lady Quin pointed. But more than that, we need a better power balance in the workplace.

In the 1920s, Stanley Baldwin—an unlikely crusader—worried about the excesses of employer power and, as an answer to it, resolved to encourage nationwide collective bargaining. His action led to a national system of negotiations which commanded international admiration and which, along with progressive taxation and the welfare state, made our society fairer and more equal. A similar crusade is needed now, to tackle inequality and put the issue at the heart of our nation’s future. Collective bargaining, information for workers, consultation with them and even representation in the boardrooms are all part of that. These can be key factors in bringing fairness and equality back to the centre of British life.