Why Miliband’s zero hours contract pledge is spot on

Ed Miliband won't be able to ban zero hours contracts, but he is tackling the worst way they are abused, writes James Bloodworth.

Ed Miliband won’t be able to ban zero hours contracts, but he is tackling the worst way they are abused, writes James Bloodworth

Zero hours contracts aren’t new, but they’ve percolated to the top of the political agenda since the recession as the economy has become increasingly characterised by temporary and insecure employment.

Indeed, according to the TUC around 1 million people – 4 per cent of the workforce – are now on precarious zero-hour contracts; and almost half the 1.2m jobs created since the coalition came to power are also accounted for by self-employment.

It’s against this backdrop that Ed Miliband will make a speech in Motherwell today promising to end the “exploitative” use of zero hours contracts. The speech follows an independent review by Norman Pickavance, a former director of Human Resources at Morrisons.

The new rights for workers that Miliband will set out are:

  • To demand a fixed hours contract when they have worked regular hours over six months with the same employer
  • To receive a fixed hours contract automatically when they have worked regular hours over a year – unless they decide to opt out
  • To be protected from employers forcing them to be available at all hours, insisting they cannot work for anyone else, or cancelling shifts at short notice without compensation.

Some have expressed disappointment that Miliband won’t go further and promise a ban on zero hours contracts. However it should be fairly obvious as to why that would be an ineffective policy – there would be very little to stop employers simply switching staff to ‘one or two-hour contracts’ as a sop to new regulations.

It can also be forgotten that, believe it or not, many workers benefit from the flexibility offered by zero hours contracts. To cite a personal example, when I worked at Royal Mail a zero hours contract allowed me to keep my job while I studied at university.

But as Miliband will say, “a minority of employers are misusing zero hours contracts as a crude way of cutting costs or managing staff”.

The key pledge from Miliband to tackle this relates to the use of exclusivity clauses by employers that have staff on zero hours contracts. At present this lets employers prevent workers from taking a job with another company even if they’re not being given sufficient hours. An employee can therefore be left without work for a substantial period of time yet still be unable to take up employment elsewhere without losing their job – they have to be permanently ‘on call’.

This is why Miliband’s pledge that employers will no longer be able to insist that “employees cannot work for anyone else” is so important – it puts an end to one of the worst abuses of zero-hours contracts without throwing the baby out with the bath water. It ensures that flexibility works both ways – not just for employers, but for employees too.

Most importantly of all though, it’s workable in practice, whereas a ban on the zero hours contracts, while music to many people’s ears, is not.

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