Continued presence of zero hours contracts suggests they might be a permanent feature of labour market

Policy action needed to prevent them becoming standard form of employment in low-paid sectors

The continued use of zero-hours contracts (ZHCs) over the recent period of strong employment recovery suggests they may remain a permanent feature of the labour market rather than a temporary reaction to the downturn, the Resolution Foundation said today (Wednesday) in response to new figures published by the ONS.

The ONS has published updates on two surveys on the use of ZHCs. Its survey of employees found that the number of workers who reported being on a ZHC increased to 744,000 in April-June 2015 – an increase of 120,000 over the year.

Its survey of employers found that 1.5 million contracts provided no guaranteed hours and had offered some work in the last fortnight in January 2015 – broadly in line with the figure of 1.4 million in January 2014. There were a further 1.9 million contracts without guaranteed hours that did not offer any work in January 2015 (up from 1.3 million in the previous year) – for example because there was no work available or because employees chose not to accept the work on offer.

Laura Gardiner, Senior Policy Analyst at the Resolution Foundation, said:
“Capturing the true scale of ZHC working has proven challenging in recent years but it is clear that this form of working is not fading away as our employment recovery gains ground.

“While it’s true that some people value the flexibility offered by ZHCs, for many they bring deep insecurity. Alongside reduced employment rights, the potentially irregular nature of earnings they provide makes it hard to budget and plan ahead.

“We should remember that only a small minority of workers are on ZHCs and overall job security has tended to rise slightly in recent decades. But for those affected – particularly in low-paying sectors such as hospitality, where two in five businesses use ZHCs – the danger is that job insecurity is becoming deeper.

“Policy makers must act to ensure that the benefits of labour market flexibility are balanced appropriately with protecting workers’ rights.”