Why Is the UK Reporting More Zero-Hours Contracts?

Why Is the UK Reporting More Zero-Hours Contracts?

New data from the UK’s Office for National Statistics show that the number of people working on zero-hours contracts throughout the country had increased by about 100,000 last year, Jo Faragher reported at Personnel Today earlier this week:

ONS reported that in the year to November 2017, there were 1.8 million contracts that did not guarantee a minimum number of hours, compared to 1.7 million in the year to November 2016. However, in terms of labour market share, zero hours arrangements still made up 6% of all contracts.

These controversial contracts, which do not guarantee employees work in any given pay period but obligate them to be on call for shifts that may or may not be assigned to them, have been the subject of intensely negative press coverage and mounting regulatory scrutiny over the past two years. Ireland has moved to regulate them nearly out of existence, while a Scottish MP has introduced legislation to ban them in the UK. The ONS’s last report on zero-hours contracts, issued last September, found that they were on a steep decline.

So what gives? Fortunately, Faragher reports, the office’s latest data almost certainly doesn’t indicate a reversal of the trend:

The ONS warned, however, that the comparison should be “treated with caution”, as the survey was changed from being voluntary to compulsory between these two periods. It also warned that increased awareness of zero hours contracts – as in workers recognising they were engaged in this type of contract – may have influenced the increase in numbers.

UK employers, therefore, should probably refrain from interpreting these figures as evidence that zero-hours contracts are back in style. While a complete ban may or may not be in the cards, the government is likely to create new rights for zero-hours employees that will make these contracts less attractive to employers. In its report issued in July, the Independent Review of Employment Practices in the Modern Economy, led by Matthew Taylor, recommended that zero-hours workers be entitled to request guaranteed hours after working for their employer for 12 months, and that a higher minimum wage be established for non-guaranteed hours.