16 Sep 2013

Cable targets abuse of zero hours contracts

Business Secretary Vince Cable launches a consultation on how to tackle abuse in zero hours contracts.

Vince Cable at the Lib Dem party conference in Glasgow (Image: Reuters)

Announcing the move in his keynote speech at the Liberal Democrats’ annual party conference in Glasgow, Mr Cable said legislation could be introduced before the end of this parliament to make the workplace and wages “fairer for everyone”.

He floated proposals for new protections as part of a package of measures which also features moves to deal with rogue company directors and new research on the possibility of more generous increases in the minimum wage.

Aides said that the moves – which have approval across the coalition government – were a mark of the extent to which Liberal Democrat ministers have shifted the agenda on employment rights since Conservatives last year failed to push through the recommendations of the Beecroft Report to let bosses “fire at will”.

The Office for National Statistics has estimated that around 250,000 workers are on zero hours contracts – under which they have no guarantee of how much work they will be given each week.

Yet the figure has been disputed by the Chartered Institute of Personnel and Development which puts it at closer to 1 million, while a recent union survey suggested the arrangements could affect as many as 5.5 million.

‘Fairly across the board’

Mr Cable ordered an internal review by his Department for Business and Skills earlier this year, which revealed that the contracts were “much more widely used than we had previously thought”.

The consultation is expected to conclude in the new year and it could result in legislation in next May’s Queen’s Speech, if government time is available.

There will be no promise to ban zero hours contracts or exclusivity agreements, as Mr Cable believes that they are suited to some occupations.

The moves follows accusations from Labour that the coalition has produced a “recovery for the rich”.

Mr Cable however has promised to act to ensure that the benefits of growth are shared “fairly across the board”.

He said: “Let no one tell you that Liberal Democrats have not made a difference. Without us in government, we would be ruled by people who think the problem with this country is that workers have too much job security.

“Instead, I will act against abusive practices in zero hours contracts, like exclusivity arrangements which prevent workers seeking alternatives, even when they are given no work. I have secured agreement in government to launch a formal consultation on the best mechanism to tackle abuse.”