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Zero hours contracts on the rise

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This time last year zero hours contracts were in the news because the fast food giant McDonald’s offered employment contracts containing fixed hours to its 115,000 employees employed under zero hours contracts. We have previously blogged on this and our articles can be found here and here.

In response to giving its employees the choice of whether they wanted to remain on their zero hours contracts or move to a fixed hours contract, 80% of McDonald’s employees opted to remain on zero hours contracts. Notwithstanding this choice, a year on, McDonald’s are facing strike action due to zero hours contracts and working conditions.

The Office for National Statistics has recently released results that show that during 2017 use of zero hour contracts in the UK rose by 100,000. This brings the total of zero hour contracts in the UK to 1.8 million. However, zero hour contracts are still heavily criticised as failing to protect employees who can be left scrambling for work to meet their outgoings due to hours being cancelled at short notice. Statistics also show that 25% of people on zero hours contracts want to work more hours.

However, as the McDonald’s example shows, offering fixed hour contracts will not necessarily solve the problem. The modern workforce contains a lot of people who value flexibility and the opportunity to earn more, over having a reliable and steady income. Zero hour contracts, despite their drawbacks, very much play into the wider dialogue around the gig economy that is currently ongoing.

The way consumers are spending is also impacting on the use of zero hour contracts, as the retail, hospitality and leisure sectors tend to have the highest need for them. It is no secret that high street spending has slowed down and so, understandably, employers want to have a degree of flexibility with their workforce to avoid disproportionate staffing costs.

The government’s response to the Taylor Review was published in February this year and can be found here. It remains to be seen whether zero hour contracts are to be relegated to history or not.   What is clear, however, is that a careful balance will need to be struck in terms of protecting employees but also allowing employers flexibility to meet the needs of their businesses.