900,000 still working on zero-hour contracts

Hovis workers in Wigan won their battle against zero hours after strike action
Hovis workers in Wigan won their battle against zero hours after strike action

THE TUC has reported: ‘The Office of National Statistics (ONS) release this week on the number of zero-hours contracts showed that there has a been a fall of 20,000 contracts over the year.

‘This is the first fall we have seen in the data series. However, at 2%, this is a drop in the ocean. There are still around 900,000 of these controversial contracts. The data produced by the ONS reminds us of some of the reasons why we should be worried about those on zero hours.’

TUC analysis shows that insecurity is concentrated among those groups that already face labour market disadvantage, including women, and Black and Minority Ethnic (BME) workers. The number of women working on zero-hours contracts has increased by 8%, further worsening women’s position in the labour market.

While the latest data is not yet available by ethnicity, TUC research based on data from the previous two quarters found that the proportion of Black workers in zero-hours contracts is almost twice the average. Zero-hours contracts also vary significantly by region. The TUC previously found that the North East is a hotspot for insecure work. And the latest data continues to show that the North East is still well above the UK average on the percentage of people in employment on a zero-hours contract (3.7% compared to 2.8%).

The TUC says: ‘While employers often argue that they need flexibility to meet short-term surges in demand, it’s clear that many are using zero-hours contracts as a long-term employment strategy. 60% of those on zero-hours contracts have been there for more than a year.

‘The data does show higher levels of dissatisfaction than for those on regular jobs. Zero-hours workers:

•Are two and a half times more likely to want a new job or an additional job

• Are four times more likely to want to work more hours. This will also reflect the fact that those on zero hours are much more likely to be part-time (65%) than those not on zero-hours (25%).’

The TUC continued: ‘That’s not surprising when you look at the experience that many of those on ZHCs report. They have told us how they face insecurity about their income and hours of work, and often miss out on key employment rights.

‘When Wetherspoons were voluntarily moving away from zero-hour contracts, they found that four out of five employees preferred a contract guaranteeing them a minimum number of hours work per week.

‘We believe that everyone should have the right to a contract that guarantees the hours they work. That’s why we’re sceptical of the Taylor Review’s recommendation that those on zero-hours contracts be given a “right to request” regular hours after a year on the job’.

Commenting on the North/South divide in the UK the TUC said: ‘Regional inequalities persist from birth to childhood, to working life and beyond. Where you are born should have no say on how your life pans out but in today’s Britain the North/South divide is not a myth …

• Your life is likely to be shorter if you’re from the North of England rather than the South

• More young adults are dying before their time in the North of England than in the South. And the gap is widening

• As a child, you’re twice as likely to live in a workless household in the North East than in if you grow up in the South East

• And when there are new jobs in the North East, two-thirds are insecure (e.g. agency, temporary, or zero hours)

•In old industrial areas, at the median, a man earns around £200 less per month than the national level. And in these areas, the poorest-paid 10 per cent earn less than a third of median earnings across Britain as a whole

•Less than one-in-three (30.6 per cent) of residents in Yorkshire and the Humber are skilled at NVQ Level 4+, against one-in-two of all Londoners.

‘The picture shouldn’t surprise anyone,’ says the TUC. ‘For too long, weak economic growth has been symptomatic of a failed London-centric model. A chart showing the difference in incomes across the British region before housing costs, reveals those in the South East are well ahead of the average after housing costs, and the Midlands, Wales and North far behind. But it’s not all roses in the South.’

The TUC warns: ‘North-South thinking is both dangerous and unfair. It’s dangerous because if the policy analysis is wrong, the policy prescription will be wrong. There are two million union members in South East and East of England, many of whom are struggling.

‘They’ll barely recognise any story that paints everyone South of the Watford Gap as being totally minted. This is where intra-regional differences are important to recognise. Inner London has continued to stride ahead in recent years, but the same can’t be said for other parts of the South …

• Out of 21 areas, in London, ten had economic output lower than UK average in 2015.

• Output in 13 London regions has fallen as a proportion of UK output since records began in 1997.

• Outside of London, output across many areas has fallen or remained static.’

The Trades Union Congress (TUC) has also highlighted the folly of the government’s suspension of the National Minimum Wage (NMW) for ‘sleep-ins’ workers in social care. It said: ‘Last month the government announced it was waiving historic financial penalties and temporarily suspending enforcement of the National Minimum Wage (NMW) for employers who require their workers to ‘sleep-in’ on the premises overnight to look after social care residents.’

Some social care employers have protested they will collapse if they have to pay arrears, which they claim amount to between £100 million to £400 million. The TUC says such estimates are ‘simply ridiculous overestimates’.

According to the government’s July 2017 evidence to the Low Pay Commission, they recovered £374,000 arrears in social care last year, and a total of just over £700,000 has been received for workers in social care in the past three years – but this also includes arrears for issues beyond failure to pay for sleep-ins, such as non-payment of travelling time between visiting clients.

The TUC says: ‘In a week that has seen the government name a record number of underpaying employers in other sectors it is time to have a look at how social care got into this kind of debt – and what will happen next. What went wrong in social care?

‘Most social care is now provided either by private sector companies or charities. Local authorities fund most social care and, faced with continuous government cuts to their budgets, have squeezed social care funding year after year. Against that tight financial background, a number of social care providers have buried their heads in the sand over the growing certainty that they must pay the minimum wage.

‘Before the minimum wage was introduced employers commonly paid workers a flat fee for sleeping in, plus an hourly rate for time spent actively working. This was changed by successive employment tribunals from the late noughties onward.’

The TUC continues: ‘Just how clear is the law on the NMW and sleep-ins? The law has certainly been in a settled position since the 2013 Whittleston v BJP Home Support Limited Employment Appeal Tribunal. Government guidance on the NMW also makes it clear that the NMW must be paid for sleep-ins.

‘Six years of minimum wage arrears can be claimed in England, Wales and Northern Ireland – and five years in Scotland, so you might wonder why some of the handfuls of large employers who are complaining did not at least consider making provision against the day when they would have to pay up.

‘Trade unions have been visibly negotiating and campaigning to ensure that social care employers pay up. In particular, Unison reached a notable agreement (with MENCAP in June 2017) meaning that staff would receive the NMW for sleep-ins from then on. Employers could also have sought free advice from ACAS if they were in any doubt about the right thing to do – and they should have done so, but some have simply failed to face up to their responsibilities.

‘What does the government’s partial suspension of enforcement on sleep-ins mean?

‘Basically, the government’s announcement means the social care sector has three months to get its act together.

‘Employers have been let off historic civil penalties in current cases. These can be quite substantial – as these penalties are twice the amount owed – up to a maximum of £20,000 per worker. However, the government will continue to pursue arrears for workers in these cases, and we have been ensured that full enforcement will resume in October’.

But the TUC says that resuming normal service will not be enough. Social care providers need to take these announcements as a wake-up call. The government simply cannot afford to let them off the NMW, and should be clear that no extension of the penalties amnesty will be forthcoming.

Providers should face full enforcement for any new offenses that occur from October onwards. The TUC goes on: ‘But the government does not come out of this very well either, as squeezing funding on social care has been a contributory factor.

‘The government must find a way to ensure that social care has sufficient funding and to ensure that social care workers are paid at least the NMW, which is the bare legal minimum. Failure to achieve these goals means that those receiving care and those who deliver it will both suffer, which is something that any shrewd government will want to avoid.’