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Most workers on zero hours contracts earn less than the living wage

The majority of workers on zero-hours contracts earn less than the living wage – and more than three-quarters of staff in London – the TUC says today (Wednesday) ahead of the publication of new official figures on the extent of zero-hours contracts.

Later this morning the Office for National Statistics (ONS) is expected to revise its estimate of the number of people on zero-hours contracts, with some reports suggesting that the figures could increase to almost a million.

The TUC is concerned that many workers on these type of contracts are poorly paid, have no regular income and are at risk of exploitation. The TUC wants the government to clamp down on the abuse of the zero-hours contracts by bad employers.

Recent TUC analysis of the ONS labour force survey found that the average hourly wage for a worker on a zero-hours contract was £8.83 an hour – a third less than the average for staff on permanent contracts (£13.39).

The report found that the majority (57.6 per cent) of workers on zero-hours contracts outside London earned less than the living wage of £7.65 an hour, while more than three-quarters of those working in the capital earned less than the London living wage of £8.80 an hour.

The report also found that workers on zero-hours contracts were nearly six times as likely to have differing amounts of weekly pay compared to staff with other kinds of work arrangements. Two in five zero-hours workers reported having no usual amount of pay. This lack of regular hours and income makes it difficult for families to budget and organise childcare, says the TUC.

Young people are finding it particularly difficult to secure permanent employment, says the report. More than two in five zero-hours workers in their twenties said they were working part-time because they couldn’t get full-time employment.

The TUC is concerned that the number of people trapped on zero-hours contracts continues to grow, even as the economy recovers. If this kind of insecure working arrangement becomes acceptable to employers, a growing number of workers will get trapped in jobs with low pay and poor career prospects.

TUC General Secretary Frances O’Grady said: “Zero-hours contracts have always been around but they were once confined to tiny areas of the labour market, and seen as a way to keep staff on even when work dried up.

“But casualised work is becoming more popular, even as the economy recovers. Companies like Sports Direct have put huge numbers of staff on zero hours contracts, even as they expand and pay bonuses to senior staff.

“Employers like to argue that zero-hours contracts offer flexibility but for many workers they mean poverty pay and no way of knowing how often they’ll be working from one week to the next.

“Replacing vulnerable zero hours contracts with more secure employment will be a key test of whether this recovery is reaching hard-pressed workers. In the meantime, the government should legislate to prevent the abuse of zero-hours contracts by bad employers.”

- Casualisation and Low Pay is available at www.tuc.org.uk/sites/default/files/Casualisationandlowpay.docx


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