Financial News

  • 1 May 2014, 9:23

1.4 Million Workers On Zero-Hours Contracts

A report estimates there are 1.4 million UK workers on contracts that do not guarantee minimum hours, as a union claims many on controversial zero-hours contracts are paid less than the living wage.

The Office for National Statistics (ONS) said most of the contracts it identified were zero-hours, under which people are not guaranteed work from one week†to the next.

Its research found that 13% of firms used non-guaranteed hours contracts,†rising to almost half in the tourism, catering and food sectors.

Other findings included women making up a bigger proportion of people on zero-hours at 55%, while 64% on zero-hours said they worked "part-time".

Another 18% of people questioned were on zero-hours contracts while in full-time education.

The findings were released as a study by the TUC†found that nearly three out of five people on a zero-hours contract outside London earned below the living wage of £7.65 an hour.

This rose to three out of four in the capital, where the rate is set at £8.80.

Labour has promised to stop abuses of the system if it is elected, while the unions want zero-hours contracts banned.

The TUC said it was concerned that many workers on the contracts were poorly paid, had no regular income and risked being exploited.

The average hourly wage for someone on a zero-hours contract is £8.83, a third less than for workers on permanent contracts, its research found.

The organisation believes increasing numbers of workers are "trapped" on zero-hours contracts, even as the economy improves.

General secretary Frances O'Grady said: "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."

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