What next for zero hours contracts?

in Economy on August 27, 2015

If you’re familiar with zero hours contracts, you’ll be well aware of the on-going controversy. The debate hit a crescendo in the run up to the general election, with all parties putting forward proposals for curbing the widespread exploitation of workers.

Over here at Rotaready HQ, we’re keeping a close eye on what happens next, as any changes to the legislation will mean rotas will become tougher for businesses to build and manage. And helping businesses build and manage rotas is what we do best.

Let me summarise the situation for you busy people

Rather than working a fixed number of hours a week, workers on zero hours contracts work varying hours, potentially as low as zero (it’s in the name).

Zero hours contracts have typically been popular with employers as they maximise the flexibility of their workforce. If staffing levels vary seasonally or differ week-on-week (e.g. dependent on the weather or key events), it’s clearly beneficial to be able to draw on more or fewer workers, rather than have a fixed number and run the risk of being over or understaffed. This also allows businesses to reduce their dependency on expensive agencies. With a flexible pool of workers to draw on, staffing levels can be topped up without needing to use third parties, which can command huge fees. This is common in the healthcare sector with the use of “staff banks”. Makes sense.

From a worker’s perspective, the flexibility of a zero hours contract means hours can be chosen around other commitments. Personally, my first job was on a zero hours contract and it suited me perfectly, allowing me to work whilst home from university between terms. Happy days.

So why are zero hours seen by some as exploitative?

Zero-hours contracts are on the rise (City AM)

Since the recession, the number of workers on zero hours contracts has increased dramatically as businesses looked to push the risks of an uncertain economy on to workers. Estimates suggest 2-3% of workers are on zero hours contracts (approx. 700,000 people).

Exploitation arises when a worker works regular hours but remains on a zero hours contract. Such contracts limit the worker’s rights (this is why they’re referred to as ‘workers’ and not ‘employees’). They have no financial security, no sickness / holiday pay, no paid maternity / paternity leave, have no right not to be unfairly dismissed and no right to redundancy payments. Offering regular work without the proper legal protection  is exploitation.

Until recently, employers could also prevent casual workers working for another employer, despite not guaranteeing them any work. This stopped workers taking other jobs to boost their income. Legislation to prevent employers using these “exclusivity clauses” in zero hours contracts came into law on 26 May 2015.

So in some cases, employers rather than workers get the benefits of flexibility.

What’s being done about it?

Employers may be forced to substitute zero hours contracts for one of these…

Political parties have put forward proposals, each with their own benefits and drawbacks, varying  from a blanket ban through to forcing employers (with possibly small businesses exempt) to offer a worker a fixed hours contract which reflects their typical hours worked over the last 12 weeks / year (the period differs between parties).

Why we at Rotaready HQ are keeping a close eye on it

Rotas are already difficult for companies to prepare, build and manage. After all, that’s what we built Rotaready to solve. The bad news is that the proposed changes will make rotas even trickier for businesses to handle. The good news is that Rotaready can already resolve the most complicated scheduling scenarios (so no matter what size and  shape the changes are, your rotas can still be generated accurately and fairly within seconds).

Below are 3 potential headaches you’re likely to face if you’re not using Rotaready:

  1. When it comes to creating a schedule, there’s a multitude of considerations: required staffing level, staff availability (working patterns as well as holiday / training / TOIL / sickness / etc), skills & attributes, working preferences, rest requirements, fairness, outsourcing… the list goes on. Whack minimum hours into the mix and the problem gets even tougher to solve. If you are handling your rosters with pen & paper or spreadsheets, you’ll probably have to redesign your entire process.
  2. If employers are forced to offer a contract that reflects the hours worked over a worker’s first 12 weeks (or similar), actually figuring out the typical hours worked and working pattern could be very difficult (and not to mention very time consuming).
  3. Even if there are no changes to the legislation, the availability of flexible hours workers can be difficult to accommodate. Perhaps someone works every other Monday only, can’t start before midday every third Wednesday, and can’t work the last Friday every quarter. Having to take this into account every time you come to build a week’s roster is going to get very frustrating very quickly.

Is this an issue for you? Maybe you’re on a zero hours contract yourself. Let us know what you think by leaving a comment below. We’d love to hear from you.

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