Zero hours contracts and Vince Cable’s “informal” review

Victoria Phillips is head of employment rights at Thompsons Solicitors

Labour’s 1997 manifesto promised to deal with the issue of zero hours contracts. But in government Labour was persuaded that it needed to “retain the flexibility that those contracts offer businesses”. The national minimum wage and working time directive were deemed as providing enough protection from abuse.


That was then. The economy was growing. But the recent dramatic increase in the use of zero hours contracts, which do not specify the number of hours the employee is required to work, represents the unacceptable face of our flexible labour market in a time of recession.


They are the ultimate in the government’s obsession with ridding businesses of burdens, allowing employers to avoid all manner of employment rights obligations to their workforce. They can, for example, get around the agency workers regulations by setting up directly employed banks of workers on zero hours contracts. Little wonder then that, according to the Financial Times, there has been a 24 per cent leap in the number of zero hours contracts used in NHS hospitals in the last two years.


Surprising then that Vince Cable has announced an “informal” review of the use of such contracts (see this week’s LELR) when they provide exactly the sort of opportunity for employers to exploit vulnerable workers that David Cameron and George Osborne appear to have been trying to engineer through the myriad of employment law reforms they’ve forced through.


Though we know from Cable’s “brave” blocking of the Beecroft report that having him on side is about as much use as a handbrake on a canoe. After all, the Tory-donor’s no fault dismissals proposal, described by Cable as “the wrong approach”, has simply been rebranded.


Having said that, we know how much the government loves to make policy on the basis of anecdote, usually tall tales from employers and insurance companies. Cable says there’s anecdotal evidence of abuse of zero hours contracts by certain employers. That should be evidence enough to take the action the TUC calls for and regulate their use.


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