Zero-hour contracts: bad news for workers, employers, service-users and the state

Submitted by sglenister on Fri, 19/07/2013 - 09:10

19 July 2013

By Christine Lewis, Unison national officer

Zero-hours contracts hurt everyone, but particularly the vulnerable in our society including low-paid workers and care services users.

The growth of zero-hour contracts (ZHC) is a prime example of increasing retrograde employment practice across public services. Some employers are using flexible and cost-cutting contracts: hire-and-fire-by-the-minute, in a short-sighted return to the 19th century. Two things will often be said: firstly, that ZHCs provide flexibility that suits employer and employee, and secondly that in these straightened times, a poor job is better than no job at all. Behind these simplistic justifications are often profitable companies and public enterprises that are exploiting their employees and the current zeitgeist that pay can be cut, sick pay removed, holidays reduced, hours increased and other benefits taken back to statutory minima in the name of austerity. The increased use of ZHCs across health, education and welfare services is a sign of these dismal times. This year, Leeds University found that as many as 150,000 homecare staff work rotas that vary from 48 hours a week to no hours at all. Employees cannot refuse work when it is required and cannot ask for it when not offered. In July, an answer to a parliamentary question estimated that over 20% (307,000) of adult care workers in England were on ZHCs. The 2012 Labour Force Survey showed that the problem went beyond the care industry with 11% of employees suffering these arrangements classed as ‘professional’; 8% ‘associate/technical’ and 8% in ‘skilled trades’.

Bad news for staff

Predictable income is probably the most important aspect of work, as it is the basis for planning life. Not knowing what you will earn from day to day is a life lived in fear and anxiety, especially for those on the lowest pay rates. Insecure work has been linked to higher rates of occupational injuries and diseases and women are more likely to be in these precarious jobs. Imagine a single mum with fluctuating wages and little idea of what she can provide for her children; stress and mental health issues would be no surprise and how does this sit with an employer’s duty of care? Evidence from the Citizens Advice Service (CAS) suggests that ZHC staff can be let go with little or no due process. They say that employers rarely dismiss them - they are simply told that there is no work for the time being. This leaves staff unsure of their position, and whether they should or can claim benefits. Although it is possible that they may be able to claim unfair dismissal or redundancy pay, the possibility of future work, not to mention a sense of powerlessness, may stop them. CAS also says that ZHC employees are susceptible to abuse of employment rights – for example, holiday pay – where there is a lack of clear rules about entitlement. If they fall sick or are pregnant, their hours may be reduced and it will be difficult to prove the cause in this uncontrolled time environment. Loans cannot easily be secured, other than through sharks, as banks will often refuse to lend to someone on a ZHC. Naturally, Unison is concerned about this worrying trend and the detrimental effect on people’s chances of gaining decent work; and we are not alone. There is a rising tide of concern among unions, politicians and welfare groups to match the rising tide of ZHCs. A report published on 25 June 2013 by the Resolution Foundation found that they can lead to ‘almost permanent uncertainty’ for staff, who are paid significantly lower wages than those on conventional contracts with specified hours. It suggests that basic employment rights are undermined and that younger workers are particularly hard hit.

Bad news for service-users

It is not only employees and their families that suffer due to ZHCs. Last year, Unison published Time to Care, a report on the impact of ZHCs in the home care sector that showed the damaging effects of precarious employment on employees and their clients. Without sick pay, and enduring a desperation for hours and a fear of being laid off, carers may go to work when they are unwell and put their clients at risk. Earlier this year, the Quality Care Commission supported Unison’s claim that one of the main problems with the current homecare service is the allocation of different carers to clients. The TUC also stated (press release, 3 July) that the rise in ZHCs, “is bad for employees and also for service users, many of whom are vulnerable adults. People want to see the same person whether it’s their regular carer or college tutor”. The inadequacy of time allowed per case, lack of continuity of care and inability to form trust relationships with clients are damaging to the quality of service and professional development. Unison welcomed the statement by Norman Lamb, Minister for Care, that in most cases, ZHCs are “incompatible with a model of high-quality care, in which the individual rarely gets to know their care worker”.

Bad news for employers

The recent Cavendish review of health and social care staff called ZHCs "a false economy" for healthcare providers, with a negative impact on staff, patients and employers documented. It suggests that these jobs carry dangerously high attrition rates of 19% in care homes and up to 30% in home care. Sectors that use high levels of ZHCs are unlikely to provide careers of choice, while jostling to secure hours will affect team cohesion. Employers may be vulnerable to legal challenges on discrimination in the way hours are allotted and on other employment rights.

Bad news for the economy

ZHC employees are likely to attract top-up state benefits. As universal credits are piloted in the North of England, the chaotic effect of ZHCs on benefit entitlement should be brought into sharp relief. Unison also welcomed the announcement in June that Vince Cable’s Department for Business, Innovation and Skills will conduct a review of ZHCs. It is hoped that government will realise that the uncontrolled growth of ZHCs is bad news for staff, service-users, employers and the economy.

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