06.03.17 Workers on Zero Hours Contracts has reached a record high

An analysis of the Office for National Statistics data reveals that a new record has been set for the number of individuals who are engaged via a Zero Hours Contract (‘ZHC’). With a 30% increase since 2014, it is clear why the debated ZHCs are making the headlines again. However, it has also been noted that the increase isn’t as drastic as the numbers on their own suggest as the increase has slowed dramatically in the last six months of 2016.

A policy analyst at the Resolution Foundation, said that “ever since the ZHCs hit the headlines the numbers have increased sharply every six months. The latest figures bring this run to an end”. It has been suggested that the decline in these contracts can be whittled down to three main reasons which include the following;

The demand for employment is reaching records highs, people looking for work are more and more conscious about the type of contracts they will sign. This increase of ZHCs could previously be linked to the financial crisis with employers actively looking to cut costs and be more flexible in their arrangements whilst employees were much more frightened of losing their jobs or having no income at all.

Secondly, there are less jobs being created and therefore less need for any type of contracts to be issued.

The reputational risks businesses face on the back on ZHC engagements is also becoming more of a fear factor and a deterrent. Many businesses have either stopped or drastically reduced their use of these types of contracts. A well-known pub chain, JD Wetherspoon, offered its staff who were engaged via a ZHC the option to move onto a contract which guaranteed hours. 

HMRC are of the view that these individuals are some of the lowest earners. However, it has been made clear that not all ZHC workers are actually low earners at all, with one in every six ZHC worker being in the “three highest-paying occupation groups”.

Aspire Comment

ZHCs have been a topic of discussion for several years now, and whilst they remain exploitative in some circumstances, it is undeniable that they offer the flexibility and opportunities that many demand. For those who have responsibilities such as children, caring, or even for students, this type of engagement offers them the chance to work without being tied in by a standard contract of employment.

The murky water surrounding “precarious working” is evidently still rife, and with the Taylor review into employment practices ongoing, it is likely that we will see ZHCs tied in with the gig-economy and modern employment practices making an important area of discussion.

If you’re concerned over your use of ZHCs please feel free to give one of the Aspire team a call for help and advice or book onto our seminar that is being held in London on 24th March to get up to date with the range of changes that are affecting employers post spring budget 2017

 See our previous news articles on zero hour contracts here;

22.10.14 Zero Hours Banning Exclusivity Clauses: Tackling Avoidance

27.06.13 Private Members Bill Seeks to End Zero Hours Contracts

27.11.15 Government publishes draft Exclusivity Terms in Zero Hours Contracts (Redress) Regulations 2015

28.05.15 Government Bans Exclusivity Clauses in Zero Hours Contracts