Paul Nowak column: ‘Labour must deliver on its promise to end exploitative zero-hours contracts’

Labour came to power on a promise to make work pay and to end the exploitative zero-hours contracts that have become endemic in this country.

It was a totemic pledge, offering workers security by guaranteeing a contract that reflects the hours they usually work. But it has come under repeated attack from bad employers who are addicted to this one-sided flexibility.

The latest data out this week revealed that more than 1.2 million people are stuck on zero-hours contracts, not knowing how much they’re going to earn week to week – near record levels.

Big business is trying to claim these are mostly students with a side-hustle who like the flexibility of zero-hours contracts, but that simply isn’t true. These are parents striving to put food on the table, carers looking after our elderly, and workers in every part of the country keeping the economy afloat.

From last minute shift cancellations to hours being cut short and demands to come into work with little notice –  these contracts are a nightmare for workers with bills to pay or kids to look after. But they’re a dream for bad bosses.

READ MORE: ‘Give workers the security they deserve’

What’s more is that these contracts make it harder to speak up when you have issues at work. Nowhere was this more apparent than the recent McDonald’s scandal, where zero hours workers said they felt unable to raise the sexual harassment they were facing for fear of having shifts taken away by their bosses. Andy Burnham has rightly pledged to take action on the cost of living, and seeing through Labour’s pledge to end exploitative zero-hours contracts is an important place to start.

The vast majority of insecure workers have struggled to meet their basic living costs because they haven’t been offered enough hours – and one in three face a financial hit of at least £3000 a year from cancelled shifts and incurred costs.

But you’d be forgiven for not knowing about these real costs that working people up and down the country face. The sensationalist media coverage around this has focused almost exclusively on the hypothetical costs to bad bosses if zero-hours contracts are stamped out.

A government impact assessment released last week found that the cost of ending one-sided flexibility could range from as little as £350 million to £2.9 billion. However, reaching that top-end figure is pretty far-fetched.

To reach it, employers would have to ignore the legislation altogether, continue cancelling shifts at the last minute, and pay out £1.2bn in compensation to workers.

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In other words, almost half of that top-end estimate is entirely avoidable if employers comply with the law.

This is an age-old lobbying tactic – amplify the most alarmist estimated cost to business and ignore the very real cost borne by workers and taxpayers who subsidise insecure employment through Universal Credit.

There are plenty of good employers who don’t rely on casualised labour – more than 80% of people working in the hospitality sector aren’t on zero–hours contracts.

In fact, the TUC commissioned independent analysis which found that the Employment Rights Act would deliver a £10bn boost to the economy through improved staff wellbeing, greater productivity and better living standards boosting demand.

And, despite the scaremongering from some employers, it will help to get young people back into work too – an MHCLG survey found that the right to guaranteed hours could make it easier for around 4 in 10 people not in work to return to work.

The truth is that good employers have nothing to fear from these new rights. The Employment Rights Act will level the playing field for them – and stop decent employers who do right by their staff being undercut by the bad ones.

The Prime Minister should crack on and deliver the right to guaranteed hours in full. 

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